RCL steps up presence in China

PUBLISHED : Friday, 04 November, 1994, 12:00am
UPDATED : Friday, 04 November, 1994, 12:00am

FAST-expanding common feeder operator Regional Container Lines (RCL) has set up a string of representative offices in China to help expand and increase its market share in the country.

In regional trade, the carrier is buying US$3 million of new containers to meet the rising demand for new box capacity.

An RCL spokesman in Singapore said a decision was expected to soon.

Bangkok-based RCL, listed on the Stock Exchange of Thailand, operates a service between the Chinese Port of Xiamen, Hong Kong and Singapore.

It is believed to be considering expanding this service to include Guangzhou and Shanghai if studies on the trade prove positive.

The carrier is expected to tread cautiously in China, where there is excess tonnage because of the presence of many major and medium-sized players.

The spokesman said representative offices had been opened recently in Xiamen, Qingdao, Guangzhou and Shanghai.

These offices would initially act as NOVCC operations to secure Chinese cargo for Southeast Asian trade, including Thailand.

The spokesman said: 'It is our long-term plan to deploy more vessels in China trade.

'But before committing ourselves further, we would like to see the direction of the trade.' Other plans in China include establishing a container freight station and participating in the development of an east Chinese port.

Construction work on the proposed $3 million station, on a 16,000 square metre site in Qingdao, will start next year.

The group is negotiating with Qingdao's port officials to take part in the third phase of the port's container development plan.

Reclamation work will start in 1996 for the terminal, which will have four berths to accommodate ships with capacity up to 1,000 20-foot equivalent units (TEUs).

On the acquisition of new containers to beef up its present box size of 9,000 TEUs, RCL said they were likely to be ordered from manufacturers in Thailand, Malaysia or South Korea.

The order would increase RCL's box capacity by 10 to 20 per cent.

'We want to have a judicious balance of owned and leased containers in order to ensure the flexibility of our box operations,' the spokesman said.

In intra-Asian trade, RCL recently added Subic Bay in the Philippines as a fortnightly destination, complementing its calls to Cebu and Manila.

The carrier is rapidly expanding its fleet to keep up with booming regional trade.

In April, it ordered two containerships from a Singapore shipyard for delivery by early 1996.

Last month, it exercised an option for two more ships from the same yard.

In July, the carrier ordered two ships from Mitsubishi Heavy Industries of Japan.

It now owns and operates 18 container vessels with an average age of seven years. It also has six time-chartered ships.

Last year, the carrier lifted 750,000 TEUs and plans to reach one million TEUs this year.