Korean liner shipping in the era of global alliances

Maritime Policy and Management

Volumn 26, Issue 3, 1999, Pages 209-229

  Thanopoulou, Helen a ^a   Ryoo, Dong keun ^a   Lee, Tae woo ^b  

^a CARDIFF UNIVERSITY   (United Kingdom)

^b Korea Maritime University   (South Korea)

Author keywords

[No Author keywords available]

Indexed keywords

CONTAINER SHIP; GLOBAL TRADE; SHIPPING;

KOREA;

EID: 0032864730     PISSN: 03088839     EISSN: 14645254     Source Type: Journal    
DOI: 10.1080/030888399286853     Document Type: Article

References (78)

1. Thanopoulou, H., 1994. Greek and World Shipping, Athens:Papazissis. See, (in Greek), Data:LRS, Statistical tables, various dates
2. 1989. “ANZECS was the first operational consortium to be formed, under the name initially of European Joint Organisation”. In Maritime Transport, Paris:OECD. See OECD 1990, See infra in the text
3. TRIO, one of the overwhelmingly gigantic Far East consortia, was established in 1971, by Hapag-Lloyd, NYK, OCL, Ben Line and Mitsui. See Jennings, E. 1980, Cargoes:a centenary study of the Far Eastern Freight Conference (Singapore:Meridian Communications)
4. 1989. Maritime Transport, 115Paris:OECD. See OECD 1990
5. Containerisation International Yearbook On 31 December 1993. Source
6. Described as peu stables. See Bauchet, P. 1982, L'Economie du Transport International (Paris:Economica), pp. 241–242. When the major re-shuffing wave among the major consortia started, in the late 1980s–early 1990s, there was, of course, evident instability. See infra in the main text
7. See Bauchet [6]p. 241 for a comprehensive classification of pools and consortia in liner shipping. See also the updated second edition, 1991, Le Transport International, p. 207
8. Some authors have added international law and national prestige to the reasons for the expansion of pools and consortia as an indirect form of integration instead of direct mergers and take-overs, see Bauchet [6] p. 243. As traditional maritime registries lost most of the fleet under their flag to flags of convenience and as newentrants from then developing countries aggressively challenged liner cross-trades, see Thanopoulou, H. 1995, The growth of fleets registered in the newly-emerging maritime countries and maritime crises. Maritime Policy and Management, 22, 51–62, this reason seems to be less valid today
9. On the basis of the results of a large scale research on liner services between S. Europe and Far East/Australasia. See Thanopoulou, H. 1990, Liner shipping companies servicing Piraeus (in Greek), Appendix 1, prepared in the context of a collective project of the Piraeus University Research Centre, Prospects of Container Transhipment in Piraeus, edited by N. Blessios and G. Vlachos
10. There also exist different perceptions of the principle of identical specifications. See for instance Caillou, R. and Swartz, D. 1980, Les transports combines:aspects techniques, economiques et commerciaux, p.157, in CEMT, Les Transports face au changements structurels (Paris:CEMT), pp.149–221, assigning common specifications only to integrated forms of consortia. However, see note 11 below on the empirical evidence for the late 1980s
11. In the late 1980s for instance, the deviation froma common size and speed of the second generation vessels of around 1500 TEUs servicing the ANZ/Med route in the context of ANZECSwas onaverage less than 5% with one exception of a vessel larger by 19% from the smaller of the service fleet, all vessels of identical 19.5 speed. In the case of Carol (Caribbean Overseas Line), considered as an example of the least integrated type of consortia beyond pools (by Bauchet [6], p.241), the Harrison, CGM, Nedlloyd and Hapag-Lloyd vessels involved were within a range of less than 100 TEUs apart, from 1 386 to 1 474 with speeds ranging from 20.0 to 20.5 knots. Ironically, larger discrepancies could be observed in the case of the (chartered-in) tonnage servicing one of the Scandutch main routes, this consortium belonging to the most integrated type. Data:Containerisation International Yearbook 1989
12. Data for co-operation agreements:Containerisation International Yearbook 1989. In fact, Maersk continued for a number of years to be outside any major consortia with the exception of its slot chartering agreement within the Far East/South African Safari consortium. Evergreen had been in a couple of joint services, but overall was proceeding on an independent basis. League table of operators:See OECD[2], p.114
13. See OECD[2], p. 114
14. See OECD[2], p.115
15. As revealed for the end of the 1980s by a review of the data in Containerisation International Yearbook 1989. For a similar comment on Ro-Ro services in the late 1970s see Caillou and Swartz [10], p.205 where the size of the vessels and thus of the investment in this type of service is assumed as not pressing for co-operation
16. Sutcliffe, P., and Garrat, M., Container traffics in Europe. Proceedings of the 2nd Roundtable. European Short Sea Shipping, pp.370London:LLP. Although feedering andmain carriage can often be co-existing thus making the analysis more complicated. For e.g. the case of Europe, see
17. Only a short sea container feeder service between Korea and Japan was provided by a Korean liner company (Korea Marine Transport). Source:Ryoo, D.-K. 1997, A Review of Korean Shipping Policy, Draft discussion paper, MASTS, UWC, p.1
18. See Ryoo[17]
19. RYOO, D.-K., 1997. Co-operation agreements in Korean Liner Shipping, 1UWC. See, Draft discussion paper, Source:Containerisation International (Monthly), June 1981, Korea mixes its Pacific presence, pp.32–37
20. TRIO and SCANDUTCH were the other two large consortia operating at the time within FEFC, TRIO having been established in 1971 and Scandutch in 1972
21. See Ryoo[19]. Data:Korea Maritime University
22. 1981. Koreans triple their European ties. Containerisation International, August:32–35. Source
23. Different sources provide different stakes of Sea-Land in the newcompany ranging from 40 to 50%. See Phillips, F. E. 1985, South Korean Lines pull for flag position. Containerisation International, December, and Jon, J. S. 1986, Development of Shipping in Korea and the Containerisation Era, PhD Thesis, UWIST. We have adopted 40% as being the correct figure
24. See Thanopoulou[8], p. 59
25. L'Incidence de Nouveaux Pays Industriels, Paris:OECD. Data in:OECD 1979
26. See RYOO [17]
27. KMTC, KSC, Hanjin and Cho Yang. See Jon [23]
28. 1985. Maritime Transport, Paris:OECD. See Thanopoulou [8], pp.55–56. Data:OECD 1986
29. Calculated on the basis of LRS data
30. See Thanopoulou [8], p. 58
31. Lim, S.-M., 1996. Round-the-world-service:The rise of Evergreen and the fall of US Lines. Maritime Policy and Management, 23:119–144. See
32. See Lim[31]
33. 1985. Les Transports Maritimes, Paris:OECD. In the transpacific trades overcapacity was estimated at 35% in 1985. See OECD 1986
34. Term that has been used in Hyundai's advertising campaigns in Europe
35. Lee, S. S., 1986. Proposal for improving waiver system in Korea. Maritime Korea, November:27 See, and Bulk Systems International, September 1985, p.15
36. Source:Moreby, D. 1985, Crew costs. Maritime Policy and Management, 12, 55-60, p. 60 table 8. No type or size of vessel provided. See also Lee, T.-W. 1993, Some reflections on the causes of growth of Korean shipping. In K. Gwilliam (ed.), Current Issues in Maritime Economics (Dordrecht:Kluwer), p. 20.
37. Jon[23]
38. 1990. Containerisation International, September:29 See
39. 1981. Korea mixes its Pacific presence. Containerisation International, June:32–37. See
40. For a synopsis of the terms of competitiveness see Thanopoulou, H. A. 1997, What price the flag? The terms of competitiveness in shipping, Draft paper, UWC
41. KMTC breaks out. Containerisation International, 61–63. Source
42. See Phillips[23], p. 37
43. See Phillips[23], p. 39. This was also the case of the foreign-owned by half Dong-Young Shipping, a joint venture with the UK/Hong Kong Swire Group.
44. Data:OECD[2], p.114
45. 1990. Containerisation International, September:30 Source
46. As for instance the Transpacific Stabilization Agreement in 1989
47. 1988. Maritime Transport, 52Paris:OECD. As e.g. the entrance of the Soviet-owned Balt-Orient Line in the FEFC. See OECD 1989
48. 1992. Conferences are gone and it is useless to try to revive them. Fairplay, May
49. See OECD[2] and Bauchet[7]
50. See Bulk Systems International, September 1985, pp. 15–16. For an analysis of the cost of Korean shipping see Lee T.-W. 1996, Flagging options for the future:A turning point in Korean shipping policy? Maritime Policy and Management, 23, 177–186
51. See Containerisation International, August 1992. Hanjin's estimation. Cho Yang at the time estimated that its operating and crewing costs were then on a par with those in Europe, p. 50
52. 1988. S. Koreans re-group for fresh offensive. Containerisation International, October:41 See
53. 1990. Containerisation International, September:29 See
54. TRIO was disbanded in March 1991, SCANDUTCH in 1992 and ACE lasted until 1995. Data:Containerisation International Yearbook
55. Although the term has rather lost its essence, at least in some cases, in terms of the balance of negotiating powers between conference and non-conference carriers
56. Ryoo, D. K., 1996. The Theory of Strategic Alliances in the Container Shipping Industry, UWCC. See, Draft discussion paper
57. 1993. Lloyd's List (magazine focus), April:5 Supplement
58. According to Hyeon Youn, director and vice-president of corporate planning of Hanjin Shipping. See Lloyd's List Maritime Asia, May 1995, p. 47
59. Graham, M. G., 1994. Scale and rationalisation in container shipping. Maritime Policy and Management, 21:331–337. See
60. The authors are grateful to B. Gardner for a stimulating discussion on this point. Especially as alliances have been recently criticized of being less than they advertise. See Lloyd's List, June 9, 1997
61. According to Sooho Cho, President of Hanjin Shipping. See Lloyd's List Maritime Asia, May 1995, p.47
62. The rest of this part is based on data and information from Hanjin Shipping Co., 1997, unless otherwise stated in the references
63. Data:research by American Shipper, in the issue of March 1996. We are grateful to B. Gardner for spotting this material
64. 1996. Lloyd's Shipping Manager, June See, Supplement
65. See Containerisation International, February 1997, p. 15. According to other estimates at around the same time this could be the 5th position, See Financial Times, 25 April 1997, p. 21 and Nedlloyd data
66. 1997. Lloyd's List, 21 May:3 See
67. Data:CI in Containerisation International, November 1995, p. 56 and in Financial Times, 25 April 1997, p. 21
68. 1997. Lloyd's List, 9 June:5 See
69. At an estimated cost of:30 000 US$ (daily hire per vessel) x365 days x2 vessels
70. P&O-Nedlloyd opted finally for the Grand Neddloyd withdrawing fromthe Global by February 1998, see Lloyd's List, 27 June 1997, p. 1. APL and NOL have equally to decide about their affiliation divided currently between the Global and the Grand
71. In the Pacific only
72. In a Rostow-like use of the term. Readers not familiar with this author should consult Rostow, W.W. Stages of Economic Growth, first published in 1960
73. The price of setting up a new service in amajor route has been estimated at half a billion US$ and upwards. See Boyes, J. 1993, Uncertain times. Containerisation International Yearbook 1993, p. 5
74. It has been estimated that on a major trade 80% of goods carried are for the account of 20 customers! OECD 1995, Maritime Transport 1993 (Paris:OECD), p. 133
75. P&O-Nedlloyd opted finally for the Grand Neddloyd withdrawing fromthe Global by February 1998, see Lloyd's List, 27 June 1997, p. 1. APL and NOL have equally to decide about their affiliation divided currently between the Global and the Grand
76. 1998. Lloyd's List. Maritime Asia, February
77. 1998. Lloyd's List, 16 March
78. 1998. Lloyd's List, 24 April