SEOUL, Feb. 28 (Korea Bizwire) – Hyundai Merchant Marine Co., a major South Korean shipping line, and two local shipping firms Tuesday forged an alliance, a move apparently aimed at overcoming the downturn hurting the entire industry.
Under the strategic alliance, dubbed HMM+K2, they will share ships under a code-sharing scheme, as well as separate assets ranging from containers to storage, they said.
The consortium will be effective for two years starting from March 1, they added.
The two other shipping firms are Sinokor Merchant Marine Co., which specializes in shipments between South Korea and China, and Heung-A Shipping Co., which has a well-established shipping line to and from Japan.
Under the local alliance, Hyundai Merchant uses 850 TEUs per week on routes to Vietnam, Thailand, the Philippines and three other routes currently operated by its two partners, while the two shipping firms will be able to share 995 TEUs on Hyundai Merchant’s five routes, including the one to Vietnam and Thailand.
The three companies also agreed to jointly develop new shipping lines to other countries starting in May.
Hyundai Merchant’s new alliance with the two local firms also came as it forged a partnership with 2M Alliance, the world’s largest shipping association, last year, under which the South Korean firm and other 2M members will share and exchange vessel space.
Their alliance came as Hanjin Shipping Co. was declared bankrupt earlier this month under heavy debts and mounting losses.
Hanjin Shipping, previously the nation’s largest shipping firm and the world’s seventh largest, was put under court receivership in September last year, as its creditors, led by the KDB, rejected its self-rescue plan.
Hanjin Shipping and local shippers have been under financial strain due to falling freight rates stemming from an oversupply of ships and a protracted slump in the global economy.