Yang Ming Marine Transport Corp’s board of directors yesterday approved plans to order new vessels capable of carrying 8,000 twenty-foot equivalent unit (TEU) and issue new debts, but failed to reach a conclusion on the potential order of mega--container ships.
Yang Ming chairman Frank Lu said on the sidelines of a legislative session on Thursday last week that he planned to submit a proposal to the company’s board this week to order five ships capable of carrying up to 16,000 TEU containers.
Analysts have said the company must double the capacity of its current 8,000-TEU vessels to maintain its market position in the increasingly competitive Asia-Europe trade route.
However, the board of Taiwan’s second-largest container shipping firm yesterday did not reach a decision on the exact number of ships to be ordered, when to place an order, how to obtain the ships or even the size of the vessels.
“The board has shown support for the plan after hearing our briefing on shipbuilding trends and the competitive advantage of mega-container ships,” company chief financial officer Vincent Lin told a media briefing.
However, the company is in no rush to reach a conclusion on the potential order as it still needs some time to research and observe the market, Lin said. Moreover, the company does not expect any major fluctuations in the pricing of ships next year, he added.
The board yesterday approved a plan to spend NT$591.6 million (US$19.65 million) on five new 8,000-TEU container ships, previously ordered by its subsidiary All Oceans Transportation Inc.
The five ships are expected to be delivered in the next two years and will be registered as national ships, the company said.
In addition, the company’s board also agreed to sell three 3,600-TEU vessels, possibly next year, while approving a plan for Yang Ming to issue a total of NT$7 billion in new debts for paying back old debts.