OOIL cuts costs and adopts new tack to check drop in income

Orient Overseas (International) Ltd (OOIL) says it will reduce operating and administration costs to cushion the impact of anticipated reductions in average revenues this year and next.

OOIL chairman and chief executive Tung Chee-hwa said the company would limit the anticipated decline in average revenues per teu, caused by imbalance between supply and demand, by changing its marketing focus, broadening the account base and improving cargo mix.

He said the company and its subsidiaries would continue to develop a competitive edge in China and Asia to increase its trade volumes.

'[We will] continue to develop new-generation sophisticated computer systems for introduction in 1997, in order to improve management information and provide better information to our customers,' he said in the company's annual report for last year.

The group would improve the quality and cost efficiency of intermodal operations, the reefer fleet would be expanded and utilisation factors also would be increased.

Mr Tung said the group would implement the new service arrangements with American President Lines (APL), Mitsui OSK Lines (MOL), Nedlloyd Lines and Malaysian International Shipping Corp on Asia-northern Europe trade.

It also would implement new service arrangements with APL and MOL on the Asia-North America west coast trade.