In recent years, the global shipping market has undergone significant changes, particularly in the container shipping sector, where carrier demand, vessel sizes, and freight costs have experienced profound fluctuations. Against this backdrop, South Korea's two major shipping companies—Hyundai Merchant Marine (HMM) and Hanjin Shipping—are facing unprecedented competitive pressures, driving their urgent need to acquire ultra-large container ships to enhance their positions in the international liner market.
As global trade recovers and shipping demand fluctuates, carriers' operational strategies and market positioning will directly impact their survival and development. Industry sources reveal that both companies have recently encountered serious liquidity challenges. With increasing international market uncertainty, capital-intensive investments have become more difficult as traditional financing channels face constraints. Shipping firms must now explore innovative financial solutions to secure sufficient funds for new vessel acquisitions and capacity expansion.
Government officials indicate plans to support both companies through financial measures to secure funding for mega-ships, aiming to help them maintain competitive advantages in the rapidly evolving market. The global shipping industry continues to trend toward larger container vessels, with current orders reaching 21,000 TEU (twenty-foot equivalent units)—far surpassing the 13,000 TEU capacity of the largest ships in these Korean companies' fleets.
While larger vessels can improve fuel efficiency and optimize global supply chains, they also raise concerns about overcapacity—particularly on Asia-Europe routes—where excess capacity has driven down freight rates and squeezed profit margins. The industry's scaling trend has intensified competition and complicated the supply-demand balance for vessels.
Experts suggest shipping companies need more flexible strategies to adapt to market changes and maintain price competitiveness. However, market-driven solutions alone may not address all competitive disadvantages, especially regarding global challenges and climate change policies. Investments in alternative fuels and new technologies are becoming increasingly critical.
Market discussions about mergers and acquisitions have also gained attention. While consolidation could enhance competitiveness, officials emphasize that any merger between HMM and Hanjin Shipping should occur voluntarily rather than through government intervention, preserving market diversity and stability.
Both companies have raised some funds through asset sales but continue facing working capital shortages amid weak demand and ongoing market pressures. Industry analysts recommend strengthening ties with financial institutions, exploring alternative investment methods, and identifying new markets to improve operational efficiency and capital returns.
As competition intensifies in the global shipping market, South Korea's two major carriers must urgently enhance their competitiveness through strategic financing and operational adjustments to secure stable positions for future challenges and opportunities.
