HMM to spend ￦15 trillion on new ships, green initiatives

Kim Kyung-bae, CEO of HMM, announces the company's investment plans at a press conference Thursday. [NEWS1]

HMM will invest more than 15 trillion won ($11.4 billion) over the next four years to maintain competitiveness, acquiring more ships and funding green initiatives in a carbon neutral future.

Of its total investment plan, the shipping company will invest 10 trillion won into acquiring new vessels and logistics facilities.

HMM currently has container vessels that can carry up to 820,000 twenty-foot equivalent unit (TEU) of cargo, and will increase that to 1.2 million TEU by end of 2026. It has 29 bulk carriers and plans to add 26 more with the investment.

The shipper announced the plans at a press conference Thursday, saying new investments were needed because there were various uncertainties in the market and due to new environmental regulations. In its first quarter earnings report, HMM stated uncertainty caused by the Shanghai lockdown and Russia’s invasion of Ukraine could affect the company's shipping orders, but said it will try to improve profitability by acquiring additional orders from big companies.

Another 5 trillion won will be invested into its green initiatives in preparation for Korea's goal of reaching carbon neutrality by 2050.

Part of the investment will be used to acquire more vessels that run on liquefied natural gas and methanol, considered eco-friendlier than bunker fuel. The company plans to develop further renewable energy solutions to power its ships in the future.

HMM will invest another 150 billion won into digitizing its services. It plans to develop a computerized system that automatically calculates shipping costs, as well as artificial intelligence services to make its shipping process more efficient.

HMM also announced Thursday it will create a team to focus on environmental social and governance management.

“Our mid- to long-term plan shows that we are investing in business areas that will allow us to grow and develop as a global shipping company in the future,” said Kim Kyung-bae, CEO of HMM. "We will fulfill our responsibility as Korea's major shipper and do our best to expand into the global market.

BY LEE TAE-HEE [lee.taehee2@joongang.co.kr]