In his New Year’s Speech to the company on Monday, NYK’s president Yasumi Kudo said that the company needed to merge its contract logistics business, NYK Logistics, with its airfreight forwarding business, Yusen Air & Sea Service, “to establish a structure capable of fully serving all logistics needs of customers”.
But he added that the merger will not prove effective until the company fosters logistics professionals “fully versed in all aspects of ocean/air freight forwarding and contract logistics” on a worldwide basis.
“This year we are keeping up a vigorous exchange of personnel among our liner trade division, NYK Logistics and Yusen Air & Service in Japan which began last summer,” a spokesman told Automotive Logistics News. “The personnel exchange in overseas has not begun yet.”
Kudo outlined that the company was still pursuing its Yosoro Project in response to the economic crisis that saw export shipments of new cars from Japan almost halved in 2009 on the previous year, “far exceeding the earlier projected downturn”.
Yosoro, which means ‘Steady Ahead’, has led to the scrapping of surplus vessels, including car carriers, as well as aircraft, warehouses and trucks. Car carrier vessels were down from 130 vessels to approximately 90 vessels at the end of 2009, as predicted in February 2009 by Mikitoshi Kai, head of investor relations at NYK (read more here).
This scrappage will continue in 2010. Those car carriers still operating, like the company’s container vessels, which saw a fall in volumes shipped of around 15%, continue to ‘slow steam’ along their trade routes.
Further slimming down strategies are due for the new year according to Kudo. “We must redouble these efforts to slim down surpluses and achieve the restoration of profits by all means during the second half of the current fiscal year,” he said.
With regard to the impact on automotive customers, an NYK spokesperson said that the merger of the NYK Logistics and Yusen Air & Sea Service will allow the company to better serve the logistics needs of its customers in ocean/air freight forwarding and contract logistics’ at one stop’.
“The benefit is not limited to ocean freight. For the automotive sector, we offer the PDI operation, terminal business and milk run as well as cross dock,” he said.
The company’s outline for structural reform includes the strengthening of vehicle transport by sea through the establishment of a more flexible fleet mixture that can accommodate fluctuations in cargo volumes and changes in fleet planning policies. It is also aiming to enhance its ability to meet export demand from China and India.