The merger of Japan’s three largest containerlines is expected to cut costs by a combined Y50bn ($440m) in its first fiscal year of operations.
Nippon Yusen Kaisha (NYK), Kawasaki Kisen Kaisha (K Line) and Mitsui OSK Lines (MOL) are merging their container divisions to form the Ocean Network Express (ONE) which is due to officially start operations at the start of April next year.
In a joint interview with The Nikkei, NYK’s president Tadaaki Naito and the president of K Line Eizo Murakami added that annual savings brought around by the creation of ONE could reach Y110bn over the following three years.
The Japanese trio decided to pool their container resources amid unprecedented consolidation seen within the liner sector over the past two years. When it launches ONE will have a combined fleet of 1.44m slots making it the sixth largest containerline in the world.
“ONE does not aspire to be the largest carrier in the market, just large enough to survive and yet still small enough to care,” Jeremy Nixon, ONE’s CEO told this site earlier this year. “We hope to offer future customers a high quality, reliable and innovative service offering. Reliable not only in service delivery terms but also in financial stability, as ONE will inherit a very strong balance sheet.”
NYK, as the company with the largest box fleet among the three, has a 38% stake in ONE, with K Line and MOL holding 31% stakes each in the new venture.