(Yicai Global) Sept. 9 -- Hard times are prompting change in the Chinese shipping industry. Container liner operator China Shipping Container Lines Co. [SHA:601866] yesterday rebranded itself as COSCO Shipping Development Co. and will extend its business line to include ship and container leasing.
At the end of last year, its parent company China COSCO Shipping Co. [SHA:601919] was formed through the merger of the largest and second largest shipping and service enterprises, China Ocean Shipping (Group) Company, trading as COSCO Group, and China Shipping (Group) Co., with a focus on container shipping.
The asset reconfiguration, once completed, is expected to save COSCO Shipping Development USD200 million in operating costs, according to an insider.
"With overall transport capacity growth slowing down and oil prices staying low, the market performance in the second half of this year should be better than the first six months,"COSCO Shipping CFO Deng Huangjun told reporters.
A large portion of COSCO Shipping's profits last year was generated by a shipping recycling subsidy. The company received CNY4.26 billion (USD637.68 million) in government subsidies, including a ship-scrapping subsidy, some CNY2.51 billion more than the previous year.
"Future investment will focus on countries such as Greece or neighboring regions of Singapore and other countries which we have already invested in. We are also interested in key ports in northwestern Europe. We are reinforcing investment in Africa and Latin America," Mr. Qiu Jinguang, general manager of COSCO Pacific Ltd., a subsidiary of COSCO Shipping, said.