HMM (formerly known as Hyundai Merchant Marine) is planning to expand its terminal foothold at the Port of Long Beach on the west coast of the United States. The decision was based on the need to expand infrastructure at the port, a key gateway to the United States
HMM recently reported this policy to its board of directors and started to draft a detailed plan.
HMM secured a foothold in 2017 by acquiring a 20 percent stake in a Long Beach terminal from Total Terminal International for 18.3 billion won. The stake acquisition lowered the port use rate of HMM to the level of Swiss shipping company MSC, the largest shareholder with an 80 percent stake. But HMM could not speak out regarding the operation of the terminal due to its small stake.
This problem has deteriorated as a recent shipping boom has caused port congestion. With cargo crowding in Los Angeles and Long Beach port terminals, the time for container unloading operations has increased from one to three days to five to eight days and lack of chassis used to transport containers inland has led to the inability to transport cargo on time.
HMM is not considering buying terminals currently up for sale. This is because their prices are exorbitant. Instead, the company is considering forging strategic partnerships with global terminal operators that already have terminals at Long Beach.
If HMM succeeds in expanding its terminal base at the Port of Long Beach, it could serve as an opportunity to regain the competitiveness of the Korean shipping industry which had been weakened due to the bankruptcy of Hanjin Shipping. In the early 2000s, Hanjin Shipping secured a terminal with a total area of about 160,000 square meters at the Port of Long Beach and handled the largest cargo volume at the port.
Source: Business Korea