Troubled Hanjin's Fleet Shrinks to a Tenth of Its Size
All but three of the remaining 14 ships are either stranded or have been seized over unpaid bills. Hanjin once operated 97 box ships, including 61 that were chartered. As overcapacity depressed freight rates and Hanjin’s debt piled up, lenders pulled the plug on credit, prompting the company to apply for court receivership on Aug. 31. A preferred bidder for some of its assets was announced Nov. 14.
Korea Line Corp., South Korea’s second-largest bulk carrier, won a bid for some assets of Hanjin Shipping Co. in a bankruptcy sale supervised by a South Korean court. Hyundai Merchant Marine Co. also submitted final bids for the fire sale.
As a sign of fading prospects of South Korea’s shipping industry, third-quarter earnings may show losses at Seoul-based Hanjin and Hyundai Merchant on Nov. 14. Daewoo Shipbuilding & Marine Engineering Co., which builds vessels for the industry, is projected to report a net income of 20.3 billion won ($17 million) based on the average of six estimates compiled by Bloomberg News.
Hanjin was the world’s seventh-biggest container line, with a market share of 2.9%, making it the only Korean carrier to feature in the global top 10. Now, it’s plummeted to 21st in rankings with about 0.5% share, according to Alphaliner, a shipping data provider.
Of the chartered vessels, all except two have been returned to owners, who since have leased them to others and changed the ships’ names. Maersk Line, the world’s biggest box ship operator owned by A.P. Moeller-Maersk A/S, has said it’s among companies that have taken on some of the Hanjin vessels.
Hanjin’s bankruptcy filing triggered disruptions in global supply chains ahead of the peak shipping period for the U.S. Thanksgiving and Christmas shopping season. The operator said in October that it was winding down its European business and said on Nov. 10 that it would let go of about 700 crew members.
