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TCC Group: Resurrecting the heady shikumisen days

Hong Kong: One of the grand names of Hong Kong shipping, Tai Chong Cheang Steamship (TCC Group) held celebrations in Tokyo this January to mark 60 years of business with Japanese partners, a stream of business TCC chairman Kenneth Koo is determined to develop.

TCC opened its Tokyo office under the name of Dowa & Co in the old Iino Building back in January, 1955. Since then, TCC’s Tokyo presence has become the driving force of the family shipping enterprise’s growth.

In 2007, during the height of the so-called shipping supercycle, a decision was made to further strengthen TCC’s Japanese niche and the result is a substantial newbuilding fleet replacement program exclusively in Japanese shipyards with the majority of the tonnage long term chartered to TCC’s Japanese major operator friends.

“Back in 2007, I set out to develop a 21st century shikumisen strategy. That is coming to fruition,” Koo tells Maritime CEO. The old shikumisen strategy – combining financing, ordering and chartering out of Japan – was how many of Hong Kong’s owners grew big in the 1960s.

TCC’s present newbuilding program of two panamaxes, two to three aframaxes and five to eight capesize bulk carriers to be built and delivered between now and 2020 are, for the most part, tied with long term charters to Japanese business partners.

Last November, TCC formed a joint venture, TK50, with Japanese shipping major, Kawasaki Kisen Kaisha (K Line) for a 182,200 dwt capesize to be built at Japan’s Imabari Shipbuilding. Further ships might be added to this venture soon.

“In today’s increasingly fragmented and commoditised shipping industry, closer collaboration between traditional shipowners would be so important in guarding and continuously improving the demanding standards of international shipping with a united voice,” Koo comments about the new venture.

Koo says TCC’s plan is based around what he describes as a boutique owner strategy building ships towards specific commercial or strategic requirements that the group’s business partners may have.

The TCC boss, the third generation of Koos at the helm, is not at all optimistic about the freight rate environment, telling Maritime CEO, “Shipping is not going anywhere.”

While many other Hong Kong owners have put much of their future in China’s growth, Koo has felt that is a risky move for a long time. Owners should no longer put all their eggs in the China basket, he says. Other routes and markets need to be found as China’s growth slows and its lines take a lion share of cargoes.

For a man born and brought up in a shipping empire, Koo has an interest in developing new technologies to take the industry forward. TCC has been supporting researchers at the University of Southern California (USC) Viterbi School of Engineering in developing a more efficient method to initiate combustion, providing a breakthrough, technological step forward in clean shipping design. The technology, transient plasma ignition (TPI), would allow marine diesel ships to reduce emissions, increase fuel economy and meet the International Maritime Organization’s (IMO) stringent emissions mandate with minimal modifications. The technology will serve as another feather in the cap of the storied history of this 98-year-old shipping line.

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