HD Hyundai Marine Solution is establishing its first overseas logistics base in Singapore to strengthen its competitiveness in the ship maintenance, repair, and overhaul business. By securing a base in Singapore, the world’s largest transshipment port, following Busan, the company aims to refine its strategy for delivering ship repair parts quickly and efficiently.

According to industry sources on May 11, HD Hyundai Marine Solution plans to construct a logistics center in Singapore during the second half of this year. The facility, to be located near the Port of Singapore, will span 13,200 square meters (approximately 4,000 pyeong) and store over 13,000 parts and materials. Full-scale operations are expected to begin in the second half of next year.

This will be HD Hyundai Marine Solution’s second logistics hub. Since its founding in 2016, the company has operated a logistics hub of the same size in Busan, capable of storing over 22,000 parts and materials.

HD Hyundai Marine Solution decided to establish its first overseas logistics hub in response to rising demand for ship MRO at the Port of Singapore. As the world’s largest transshipment port, Singapore processes 37 million twenty-foot equivalent units (TEUs) annually, and sees a high volume of vessels requiring maintenance.

HD Hyundai Marine Solution also plans to build an additional logistics center in Busan. The company will invest 48.3 billion won (approximately $34.48 million) by 2028 for this purpose, while allocating 13.5 billion won to secure additional global port warehouses outside of Singapore. The company currently operates subsidiaries and parts warehouses in Houston in the U.S., Singapore, Dubai in the United Arab Emirates, and the Netherlands, and plans to expand this network.

The company’s push to strengthen its aftermarket (AM) services comes in response to growing demand for ship MRO services, driven by the global shipbuilding and maritime industry’s shift toward eco-friendly solutions. Major global shipping companies are now accelerating the adoption of ships equipped with dual-fuel (DF) engines. According to Clarkson Research, the share of DF engine-equipped ships in the global shipbuilding order backlog has surpassed 40 percent.

As ship AM services become more advanced, HD Hyundai Marine Solution is seeing improved profitability. The company’s AM service revenue per ship increased by 97 percent last year compared to 2021. In the first quarter of this year, it posted revenue of 485.6 billion won and operating profit of 83 billion won, marking record-high quarterly sales for the fourth consecutive quarter. Industry forecasts project the company’s revenue will continue to grow and exceed 2 trillion won this year, with operating profit expected to rise to 350 billion won this year, 450 billion won next year, and 580 billion won by 2027.

Source:Business Korea