Thursday, November 12, 2009

Nippon Yusen To Cut Container and Air Freight Services

Seeks Greater Slice of Bulk Shipping Pie
Shipping News Feature

JAPAN - Japan's biggest shipping company, Nippon Yusen Line (NYK), has announced that it plans to raise $1.6 billion through a public share offering and to reform its services so as to expand its interests into a greater diversity of core markets.

The company has been particularly hard hit by heavy losses in its air freight business and the slump in container shipping rates caused by the downturn. The share issue policy is following on from the example of several other shipping lines that have sort to exploit burgeoning equity markets.

NYK Line plans to use the revenue created to invest in new ships and fund structural reforms which include cutting its container fleet and investing in more bulk carriers so as to improve its share of the iron ore market for China, something rival Mitsui O.S.K. has done extremely well from.

It also looks likely that NYK Line will look to consolidate it air cargo services with another operator due to the losses incurred in what is a very much over catered for market.