"Investment for Survival"…HMM Preparing for a New Start

HMM Announces Mid-to-Long-Term Strategy
Investing 15 Trillion KRW, Largest Scale Ever

[Asia Economy Reporter Kiho Sung] HMM, the largest national shipping company in South Korea, plans to increase its container capacity to 1.2 million TEU (1 TEU equals one 20-foot container) over the next five years and invest 15 trillion KRW in strategic shipping assets. This marks the largest investment in the company's history. Given the growing uncertainties in the shipping market due to global economic recession concerns, along with rapidly changing business environments such as environmental regulations and digital transformation, this investment decision is seen as a bold measure.

On the morning of the 14th, HMM announced this mid-to-long-term strategy at its headquarters in Yeouido, Seoul. About 100 executives and employees, including CEO Kyung-bae Kim, attended the announcement.

CEO Kim emphasized that this investment is a decision for survival. He stated, "The 15 trillion KRW investment plan is not because we have excess funds, but because we judged that without investing, we cannot survive in the future." Previously, HMM's largest investment was 3.15 trillion KRW in 2018, when it ordered 20 ultra-large vessels as part of the government's 'Five-Year Shipping Reconstruction Plan.'

HMM explained that due to increasing uncertainties in the global shipping market caused by environmental regulations and digital transformation, it established this strategy to build a solid growth foundation as the largest national shipping company.

The execution strategy announced by HMM is broadly divided into ▲ container ship and bulk ship business strategies ▲ response strategies to changes in environmental regulations ▲ digital acceleration response strategies ▲ organizational capability enhancement strategies to improve competitiveness ▲ business foundation investment and financial strategies.

First, to strengthen its capabilities as a shipping company, HMM plans to expand its current container capacity of approximately 820,000 TEU to 1.2 million TEU by 2026.

Additionally, it will secure logistics infrastructure such as terminals to strengthen its revenue base and expand service areas through additional route expansions.

Furthermore, to promote balanced growth between container and bulk businesses, HMM plans to increase its bulk ship fleet from the current 29 vessels to 55 vessels by 2026, a 90% expansion.

HMM aims for carbon neutrality by 2050 and will also strengthen environmentally friendly logistics services. The company has already responded by replacing existing vessels with low-sulfur fuel and installing scrubbers. In addition, it plans to focus on acquiring low-carbon vessels based on eco-friendly fuels such as liquefied natural gas (LNG)-powered ships.

Alongside this, HMM will proactively respond to changes in the shipping market by investing more than 15 trillion KRW over five years until 2026.

10 trillion KRW will be invested in core assets such as vessels, terminals, and logistics facilities, and 5 trillion KRW will be allocated to business diversification efforts including shipping companies, eco-friendly fuels, and integrated logistics. Additionally, 150 billion KRW will be invested in building an e-platform and advancing resource management systems (ERP).

Moreover, HMM has established a dedicated organization to execute ESG (Environmental, Social, and Governance) management strategies and plans to pursue sector-specific goals by 2025.

CEO Kyung-bae Kim said, "This mid-to-long-term strategy focuses on investing in related businesses to continue sustainable growth as a global shipping and logistics company in the future."

This content was produced with the assistance of AI translation services.