South Korean logistics company Hyundai Merchant Marine has signed a memorandum of understanding (MoU) with intra-Asia trade carriers Heung-A Shipping and Sinokor Merchant Marine in order to develop a new HMM + K2 consortium.

Apparently, the agreement has been signed as a move to overcome the downturn affecting the entire industry, reported Hellenic Shipping News.

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With the signing of its formal contract in February this year, Hyundai Merchant Marine will commence operations of the new HMM + K2 consortium.

"The agreement between the companies will automatically be renewed for successive two year terms."

The establishment will cover South East / West Asia, Japan, and China trades. The agreement between the companies will automatically be renewed for successive two year terms.

With the development of the consortium, Hyundai Merchant Marine will be able to acquire competitiveness against major shippers, as the company will have full access to Heung-A and Sinokor’s Intra Asia networks, that primarily focus on the Korea-Japan and Korea-China trades.

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The HMM + K2 consortium will facilitate cost savings, as well as enhancements in customer services for both Heung-A Shipping and Sinokor Merchant Marine.

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The alliance will help strengthen the weak points of the two local shipping companies in Tri-party services, as well as better the overall quality of their services.

The consortium will also include Slot exchange, Slot purchase and Vessel Sharing agreements, along with additional plans to encourage joint investment in port infrastructure and sharing of container equipment both in medium and long terms.

It will enable the shipping companies to share ships under a code-sharing scheme, along with separating assets, ranging from containers to storage.