SEOUL: Hyundai Merchant Marine Co., South Korea's biggest shipping line, said Tuesday it will place an order for 20 container ships with local shipbuilders in the second quarter as part of its effort to expand its services.
Hyundai Merchant will select a shipbuilder or a couple of builders by June to build 12 20,000 twenty-foot equivalent unit (TEU) container ships and eight 14,000 TEU container carriers, the company said in a statement.
Earlier in the day, the company sent a request for a proposal to Hyundai Heavy Industries Co., Samsung Heavy Industries Co. and Daewoo Shipbuilding & Marine Engineering Co.
Industry insiders estimate that the entire deal could be worth around 3 trillion won (US$2.81 billion).
As the International Maritime Organization will only allow vehicles using fuel that contains a maximum 0.5 percent of sulfur starting Jan. 1, 2020, Hyundai Merchant will have all the new ships either equipped with the latest Scrubber system that reduces sulfur oxide or operate on liquefied natural gas, the company said.
The 20,000 TEU container ships will be used on the Asia-North America routes and the eight 14,000 TEU container ships will be operated on routes to the east coast of the United States, it said.
Hyundai Merchant, which earns 80 percent of its earnings from the container ship business and the remainder from the bulk-carrying business, operated 90 ships composed of 52 container carriers and 38 bulk carriers -- as of the end of March, according to the company.
Twenty of the ships are owned by the shipping company, which has business alliance contracts with the world's leading container shipping firms MSC and Maersk Line.
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