South Korea’s recently established SM Line is on the verge of joining the Top 20 of carriers by operated fleet as it continues its second-hand shopping spree, shipping consultancy Drewry informed.
The ambitious newcomer SM Line emerged out of the ashes of bankrupt compatriot Hanjin Shipping, when it first purchased the defunct carriers’ Transpacific non-ship assets for a reported USD 23 million, followed up by acquisitions of 11 former Hanjin container ships and two terminals in Gwangyang and Inchon.
Driven by an abundance of cheap second-hand ships acquisitions, SM Line managed to increase its fleet to a total of 18 ships with an aggregate capacity of 99,800 TEU, as reported in August 2017, along with another five ships totaling 6,000 TEU it has on charter.
The company earlier informed that it’s goal is to operate 30 ships by the end of this year.
Although it could soon break into the Top 20, SM Line “will not become a rival to the elite global lines in the short-to-mid-term, but its rapid trajectory suggests that it will find a niche in the medium-size category,” Drewry said.
“The abundance of cheap ships on the market means that there are still opportunities for ambitious newcomers to force their way in.”
In the six months since the start of operations in March, SM Line has grown its operations so quickly that it now offers a total of nine weekly services; six in the Intra-Asia trade (one of which as a slot charterer), two in the Asia-India trade (both as slot charterers) and one in the Asia-West Coast North America trade, scaled back from an initial plan to operate two Transpacific loops.
More services will follow as SM Line aims to boost its current 50,000 TEU operated capacity at least four-fold, with new services inked for the “near future” that will connect the Far East to the Pacific Northwest, the US East Coast, West Coast South America, Australia, the Middle East and Red Sea.
To assist its international expansion strategy SM Line is to merge with two other SM Group companies, Woobang Engineering and Construction and Korea Shipping Corporation, while closer to home it is entering into a voluntary partnership agreement, the so-called Korean Shipping Partnership (KSP), with 13 other Korean shipping lines to bolster the domestic trades.