Phil MeekinView Profile
It was only a couple of months ago that we heard that Santa Claus may not be coming as Christmas may be on hold in 2016 as a consequence of South Korea’s shipping giant, Hanjin Shipping, having filed for bankruptcy protection under Chapter 15 in the U.S. to protect its vessels from being seized by creditors. This followed the withdrawal of bank support.
It left a number of ships stranded at sea and unable to unload their cargo.
Fierce competition caused by an over-supply of capacity in international shipping has resulted in falling prices which hit Hanjin – the world’s seventh largest container line. In fact, Hanjin has returned a loss in four out of the last five years.
September is the busiest time of year for shipping companies who are carrying stock and merchandise to countries across the world ready for the Christmas period.
Santa Claus Is Coming To Town
With the sheer volume of children across the world, Father Christmas depends on shipping companies to make bulk deliveries to different countries.
Just like a fairy tale, Hanjin managed to raise funding in time to deliver its stocking-filling cargo. A lifeline comprising a mixture of South Korean government loans and cash injections from both the parent company and family monies enabled the company to start transporting its festive freight.
Will Hanjin live happily ever after? It is difficult to say. An increase in demand for shipping is not anticipated and that suggests there may be further casualties in the industry.