NYK cuts fleet expansion

    



Updated December 9, 2008



Hisane Masaki / The JOURNAL of COMMERCE ONLINE



TOKYO -- Japan’s NYK Line, the largest Japanese shipping firm by sales, announced that it will revise downward its fleet expansion plan by around 25 percent, or 50 to 60 ships, amid the rapidly deteriorating global shipping market.



The carrier also will launch a full-scale review of its current medium-term management plan, which sets both business performance and fleet size targets, in January and release the revised plan by the end of next March, a company spokesman said.



The current three-year management plan, dubbed “New Horizon 2010,” was announced in March. It will run from fiscal 2008, which started in April this year, through fiscal 2010.



The current management plan calls for increasing the fleet by 223 ships, or nearly 29 percent, to 1,000 ships in fiscal 2010 from 777 ships at the end of fiscal 2007. The expanded fleet would include 630 bulk and liquefied natural gas carriers; 150 car carriers, and 220 liner vessels.



The spokesman said that the company will downgrade the fleet expansion plan by 50 to 60 ships to a total 950 ships, primarily by scrapping old vessels earlier than originally planned.



There will be no change in the company’s plan to invest 1.37 trillion yen ($14.81 billion) to procure 218 new ships between fiscal 2008 and 2010, he said.



Japanese rival MOL also will revise its plan to increase its fleet by 126 ships, or about 14 percent, to 1,000 ships in fiscal 2009 from 874 ships at the end of fiscal 2007.



A spokesman for MOL confirmed a recent Japanese newspaper report that the company will downgrade its fleet expansion plan by 40 percent, or about 50 ships, to around 950 ships in fiscal 2009.