SM Line is to withdraw four vessels from its services to Indonesia as Korea Shipping Partnership (KSP) member companies begin to streamline their services to avoid duplication.
Set to begin operations in the first quarter of 2018, KSP is a quasi-alliance of local liner operators looking to restore confidence in South Korean shipping companies after a series of highly publicised crises.
The alliance comprises Hyundai Merchant Marine (HMM), SM Line Corporation, Heung-A Shipping, Dongjin Shipping, Sinokor Merchant Marine, Hansung Line, Pan Continental Shipping, Namsung Shipping, Korea Marine Transport Co., Ltd, Pan Ocean, CK Line, Dongyoung Shipping, Doowoo Shipping, and Taiyoung Shipping. The Ministry of Oceans and Fisheries (MOF) and the Korea Shipowners’ Association promoted the alliance, which will operate intra-Asia services.
Currently, six South Korean liner operators operate 20 ships in five services to Indonesia. Consequently, one of these services will be eliminated.
HMM, Korea Marine Transport Co, Ltd, Sinokor Merchant Marine, and Heung-A will continue to deploy vessels to services to Indonesia.
Backed by the Samra Midas Group, which also owns Korea Line Corporation and Korea Shipping Corporation, SM Line was established by Samra Midas Group to acquire the trans-Pacific and intra-Asia portfolios of the now-defunct Hanjin Shipping, the country’s once largest shipping company that went bust in February 2017.
The MOF said in a statement that the streamlining will also affect services to Thailand and Japan, which will see the removal of seven ships.
Heung-A vice-president Lee Hwan-gu said, “Following the first round of the realigning of the routes, the shipping companies’ operating costs can expect to be reduced.”
Three of the ships that will be removed will be redeployed to services to China and Vietnam as the KSP member companies believe these markets have more growth potential.
MOF’s director for shipping and logistics, Eom Ki-doo, said, “It’s very encouraging that the companies are progressing in their voluntary reorganisation and we hope that they can co-operate in other areas in the future.”