According to Drewry Maritime Research, the merger between the three largest ocean carriers from Japan: Kawasaki Kisen Kaisha, Ltd. (“K” Line), Mitsui O.S.K. Lines, Ltd. (MOL), and Nippon Yusen Kabushiki Kaisha (NYK) will be positioned as the sixth largest carrier by containership fleet.
The Ocean Network Express (ONE) is expected to start operations in April 1, 2018 with a fleet of about 1.4 million TEUs of capacity, which covers 7% of the global market share.
This volume puts ONE behind the strongest shipping lines such as Maersk Line, Mediterranean Shipping Co. (MSC), CMA CGM, COSCO and Hapag-Lloyd.
The holding company will be established in Tokyo, with headquarters in Singapore and regional offices in Hong Kong, London, Richmond and Sao Paulo.
Nippon Yusen Kabushiki Kaisha (NYK) will be the largest shareholder with 38 percent. MOL and “K” Line will hold 31% share each.
“The distribution reflects NYK’s greater number of owned ships (active and on order) and terminals (10) that it is putting into the JV,” Drewry said. “Based on the same criteria, MOL might have expected to have gained a bigger share than K Line with a similar number of owned ships, but contributing more terminals (seven versus three).”
The ONE carrier have been experiencing a fall of 20% in annual container sales since 2014, from $20 billion to $15.7 billion in calendar year 2016. Additionally, the three carriers have suffered around $1 billion in collective operating losses from container operations.
“It is these heavy losses that spurred the ONE lines to finally come together after years of speculation and seek the cost savings to reverse their fortunes,” Drewry said.