2017 a year of consolidation and preparation for HMM, CEO says

South Korea-based Hyundai Merchant Marine (HMM) will post losses through to the first half of 2018 and, as a hedge against adverse conditions, HMM has initiated talks to invest in box terminals in Southeast Asia, CEO Yoo Chang-keun said last week.

Once the company begins to move into profit, it will order new ships to meet new emission rules scheduled to take effect by 2020. “This year will be the year to strengthen our financials. We are targeting to make an operating profit in the third quarter of next year. By early next year, we expect much of the overcapacity in the market will be resolved.”

While the company has not finalized how many new vessels it plans to order, Yoo said that between five and six ships are usually needed for the service loop between Asia and the US, and about 10 for Asia-Europe trade. Meanwhile HMM plans to order small-to-medium-sized container vessels to replace aging ones currently used within Asia. That will be the first since its last order in 2011. The company is also considering as many as five tankers. As of the end of January HMM operated 114 ships, including 63 container vessels.