Thursday, March 11, 2010

New Container Shipping Company Due To Go West

Inaugural Sailing Set for April
Shipping News Feature

CHINA – US – At a time when only the bravest might consider a major investment in container shipping by way of a brand new venture as a bright idea, next month TCC - The Containership Company – say they will launch their new “no frills” service between the two countries. Rumours in October that John Fredriksen would back the venture are said to have come to nought with the Norwegian tanker billionaire said to have been advised to avoid a possible conflict of interest. Mr Fredriksen is a major stockholder in other shipping groups.

Now the new company, modelled on the budget airline principle, say they will launch from a port 60 kilometres North of Shanghai for a direct voyage to California. There will be no infrastructure for collections and deliveries apparently, simply shipment of the boxes Port to Port from the Taicang Gateway international container terminal. The company aims to snap up some of the hundreds of vessels lying idle around the world at bargain basement rates to supply its demand for suitable ships. The service is promised to commence on the 17th April with arrival at either Long Beach or Los Angeles on the 2nd May.

The new service is known in Shanghai as “Great Dragon” with the first ship called Taicang Dragon and $25 million was apparently raised in Oslo to finance the deal. Certainly the two men heading up the exercise have a wealth of experience in the field and, provided they don’t stretch too far too fast there seems no reason why their “cherry picking” freight operation should not work. Utilising smaller ships up to around 3000 TEU capacity there is still plenty of freight in the geographical sector of the market they have chosen. By avoiding the awkward to accommodate traffic and concentrating on that client segment which regularly supplies reasonable levels of container freight the new company can keep its management costs to a minimum.

The company is said to have listed on the Oslo Axxess, not a recognised exchange although it trades following EU guidelines, but we could not find a listing at the time of going to press. Franck Kayser co founder of the TCC, has said in a statement that they have four ships now available on three year time charters to enable the business to begin immediately. Mr Kayser is an ex Senior VP at CMA-CGM Group and has been a Director with Maersk Line. His co founder is Jakob Tolstrup-Moller, a managing partner with Boxton Maritime AS who are believed to be amongst the backers of the new venture.

Many in the industry will be watching the progress of this new operation with keen eyes. By offering a simplified tariff, provided they can stick to it, and no allegiance to other shipping interests, the way is clear for a small predator to pick up a useful sector of the trade. Whether the model can be extrapolated to other destinations is open to question. The team at TCC have been careful to pinpoint a small area where they believe the surfeit of traffic can provide a regular income for a reliable, basic operation. By avoiding the back office clutter and the overheads which come with a conventional container shipping business they may well prove a success in a limited field provided their sales team can drum up enough revenue to get the organisation past the first few months.

It is thought that the company will launch a further share issue during the next few months to enable them to consolidate their position in what they hope will be a profitable exercise.

Photo :- China Shipping vessel moored at Taicang Quayside.