Smallest ships, fastest service

While Hyundai Merchant Marine gets ready to re-enter the Asia/Europe trade with the route’s smallest ships, 2018 is set to be the year of the ultra-large containership, with 53 ships larger than 13,500 TEU scheduled for delivery in the coming months.

The containership fleet has already expanded by 1.2% in January alone, equal to the entire fleet expansion of 2016.

HMM has stated that the port rotation of the new Asia Europe Express (AEX) has not yet been finalised, but press reports suggest that the new service will turn in 10 weeks, calling at Busan, Shanghai, Ningbo, Kaohsiung, Yantian, Singapore, Colombo, Rotterdam, Hamburg, Felixstowe, Singapore, Hong Kong, and Busan.

The first sailing is planned for April 7 from Busan with the 4,728 TEU Hyundai Grace.

Deploying the smaller ships will make the Korean carrier’s unit costs significantly higher than the mega-ship operators on Asia-Europe, but at the same time, the service will have the fastest connections between Busan and Europe with a transit time of 30 days. HMM

It is not yet clear whether the higher unit costs and faster transit times mean the AEX will be marketed as a premium service and priced accordingly.

HMM operates a premium service on the trans-Pacific that charges premiums of 10-20% for faster and guaranteed service, so it seems likely that they will adopt the same strategy from Asia.

HMM withdrew from the Asia-Europe trade amid the debt restructuring that followed the collapse of Hanjin Shipping and currently offers slot charters on six Asia-North Europe loops on 2M Alliance services operated by Maersk Line and Mediterranean Shipping Company within the 2M and HMM arrangement that was implemented in April 2017.

Their re-entry into Asia-Europe comes at the same time they are preparing an order for 12 x 23k teu ships for delivery from 2020, which is when HMM’s arrangement with the 2M Alliance is set to expire.