Hyundai Glovis Co., the world’s second-largest car shipping company, aims to top the industry with an expansion of its fleet, specializing in electric vehicle transportation services with exclusive docks in major ports worldwide.
Hyundai Motor Group’s logistics unit has maintained the No. 2 position for a third straight year in 2021, following Japan’s Nippon Yusen KK (NYK).
Hyundai Glovis operated 95 vessels to transport vehicles last year, up from 54 ships in 2016, according to industry sources on Sunday. NYK was the only company that has more carriers than Hyundai Glovis with 105 ships. Japan’s Mitsui OSK Lines (MOL) and Kawasaki Kisen Kaisha Ltd. (K-Line) ran 85 vessels and 75 carriers, respectively, while Europe’s EUKOR Car Carriers managed 71 ships.
The South Korean shipping company has been steadily raising its fleet on growing demand from global automakers. It increased the number of car carriers last year from 86 in 2020 even as the global automotive chip shortage disrupted car production worldwide.
Hyundai Glovis plans to add seven more vessels by building new ones as well as long-term charters, although Japanese competitors don’t have such expansion plans due to the ongoing pandemic. That is expected to keep shipping fares high until 2023, sources said.
SHIPPING CONTRACTSThe car shipping company has signed its largest deals in 10 years -- excluding its affiliates Hyundai Motor Co. and Kia Corp -- with five carmakers for 2022. Those clients consist of two European automakers, a US company, an Asian maker and a global player. The contracts with the two European companies and the US automaker expire in 2024.
In 2016, Hyundai Glovis transported cars for only one Asian maker.
“If the current trend continues, Hyundai Glovis is expected to aim for the No. 1 spot within a few years,” said an industry source in South Korea.
Hyundai Glovis generated 61% of its total sales last year from automakers not part of Hyundai Motor Group. The group’s logistics arm is considering the operation of larger vessels to secure economies of scale.
SPECIALTY IN EV TRANSPORTATIONThe company’s specialty in EV transportation and exclusive docks are predicted to boost demand for Hyundai Glovis’ services, according to the local industry sources.
A fire at a battery installed at an EV on board could engulf an entire car carrier. Hyundai Glovis has the technology to manage the temperature and humidity of decks for EVs, as well as their charging state to prevent such a disaster.
Earlier this month, another company's ship packed with luxury cars caught fire in the middle of the Atlantic Ocean. Some of the vehicles were electric and their lithium-ion batteries made the fire very difficult to extinguish, media reported.
Write to Hyung-Kyu Kim at
khk@hankyung.comJongwoo Cheon edited this article.
