[EN-SEA] President Akimitsu Sees MOL Springing After Hunkering Down

HAVING emerged from a period of retreat by cutting tonnage, Mitsui OSK Lines (MOL) has decided to accelerate to greater profit, according to company president Akimitsu Ashidad.

"Let us keep making every effort to reach a consolidated ordinary profit of JPY100 billion (US$1.05 billion) for FY2010, and a consolidated ordinary profit of JPY150 billion FY2012," he said in a speech marking the company's 126th anniversary.

Using analogies of the rai-cho snow grouse weathering harsh winters, but soaring in springtime, and to the first millennium Japanese general Sakaro, who successfully deployed warships that could speedily reverse themselves, Mr Ashidad outlined MOL tactics past, present and future.

Mission Sakaro, he said, involved reducing the size of fleets in the face of oversupply and diminished demand. It was now being superseded by Operation Gear-Up, in which first move was to increase the company's current reduced speed of one to two knots to a figurative 10 knots in coming months.

"We ended FY2009 in the black, while the world's other major ocean shipping companies fell into the red. This has validated my belief in the benefit of what I term 'centipede management', that is, diversifying risks by having multiple business sectors - the many legs" of a centipede so that any weakness in one or more "legs" does not cripple or hinder the organisation as a whole," he said.

"The containership business, which had no choice but to suffer large deficits due to the severity of the economic recession, is now conserving its strength like the rai-cho in winter, and preparing to welcome the return of spring through the scaling-back of its fleet size to the minimum required operational level, ongoing cost saving efforts, and making attempts to stimulate a self-sustaining market recovery," said Mr Ashidad.

"They are also taking steps such as slow-steaming to reduce fuel consumption. I really expect the containership business, by taking a leaf from the behaviour of the rai-cho, to achieve a turnaround in the term of this plan and once again fly high in the warmth of spring," he said.

"The most urgent task facing us is to return the container business sector to a robust and healthy state. Needless to say, it is very important that the brain and body of the centipede, that is all levels of administrative support, give their utmost support to the various business sectors and remain active at a high operational level," added Mr Ashidad.

Source : HKSG, 09.04.10.