Mitsui O.S.K. Lines
Encyclopedia
is a Japan
ese transport
company headquartered in Toranomon, Minato
, Tokyo
. The company's main area of operations is international shipping
. Its alligator
logo
can be seen on containers in port
s around the world.
Founded as a key part of the Mitsui
zaibatsu
(family-owned conglomerate
) during the early industrialization of Japan, the company is now independent of the zaibatsu, but remains part of the Mitsui keiretsu
(group of aligned companies).
Many heads of this company have wielded considerable power in Japan and abroad. One of the latest is Masaharu Ikuta
, who has been appointed to head the newly privatized
Japan Post
.
financial circles. OSK was capitalized at ¥1.2 million, with 93 vessels totalling .
In the first few years its routes were limited to coastal services in the western area of Japan. In 1890 OSK inaugurated an Osaka-Pusan run followed in 1893 by the operation of an Osaka-Incheon
route and Korean coastal services. The company was recapitalized at ¥1.8 million in 1893, rising to ¥2.5 million in 1894, to ¥5 million in 1896, when the government of Taiwan
granted OSK subsidies for Osaka-Taiwan liner services, and to ¥10 million in 1898 when the company started to operate on the Yangtze River.
In 1898 Tokugoro Nakahashi became the company's fourth president. He made a great effort to rationalize the internal organization of OSK, to penetrate the Chinese market, and also to inaugurate the first OSK ocean route, a Hong Kong
to Tacoma, Washington
service, in 1908. In 1911 OSK started a Kobe
to Bombay service. The route was under the monopoly of the Far Eastern Freight Conference (FEFC) of which Nippon Yusen K.K. (NYK) was the only Japanese member. OSK fought against the FEFC and was admitted to the conference in 1913. In 1918 the company opened a Bombay to Marseilles route and was admitted to full membership of the FEFC. Meanwhile, it opened a San Francisco route, an Australia
route, and a South America
route, offering a worldwide liner service. It began a New York
service in 1920 but operated at a deficit. In 1930 OSK made a huge investment in five new high-speed motor ships in order to start a New York express service. This service entirely transformed raw-silk
transportation from Asia to America; raw silk began to be carried by water all the way to New York instead of going by land. OSK's share of cargo shipped on this route grew, and its business performance improved in spite of unfavourable business conditions.
During the Great Depression
, OSK and NYK made a cooperative agreement in 1931 whereby OSK abolished its Puget Sound
route, which had called at Tacoma and Seattle, and in turn acquired a monopoly on the South American east coast route. OSK quickly recovered from the deficits of 1930 and 1931, and resumed paying dividends in 1932.
The company's profits peaked in 1941, when OSK was capitalized at ¥87 million and had 112 vessels aggregating .
mined at the state-run Miike mines. It chartered boats and transported coal on its own account. In 1878 it bought a steamship, and in 1888 it bought the mines. Mitsui Bussan became an industrial carrier and the shipping section was established in 1898. The section expanded to become the Shipping Department and moved to Kobe in 1904. The company then owned 9 ships aggregating , and on the eve of World War I
the fleet totalled 15 ships with , increasing to 30 ships totalling in 1919. The third general manager, Teijiro Kawamura, expanded the business of the department during World War I; in 1914 it began a tramp service carrying the company's own cargo and that of other companies. In 1917 it constructed a shipyard and set up the shipbuilding department and in 1920 it opened a semi-liner service from Dalian
via Kobe to Seattle, whereby a liner service operated on outbound voyages but on the return voyage, owing to insufficient cargo at Seattle, ships had to stop and collect cargo at other ports.
Mitsui Bussan's Shipping Department built two sister ships in 1924. One was equipped with reciprocal oil-burners, the other had diesel engines and was the first ocean-going diesel ship in Japan. The department put these ships on the North American route and compared their performance. Akagisan Maru, the diesel ship, proved superior, and Mitsui concluded a manufacturing and marketing license agreement with Burmeister and Wain Co. (B & W), who had manufactured the engine, in 1926. In 1928 Mitsui opened a Bangkok
route, in 1931 a Philippines
route, in 1932 a Dalien to New York route, and in 1935 a Persian Gulf
route. From 1933 the Shipping Department became known as Mitsui Line. In 1937 it owned 35 ships aggregating . The shipbuilding department was separated off as the Mitsui Tama Shipyard in 1937, and in 1942 the former Shipping Department too became a separate company, Mitsui Steamship Co., Ltd. (MS). It was capitalized at ¥50 million, and Takaharu Mitsui was elected chairman.
OSK, like other Japanese shipping companies, was forced to be a mere ship owner. When the war ended it had only 55 vessels left, totalling 143,976 grt, most of which were so-called wartime standard ships, of poor quality. All ships were under control of the Allied powers through the Civilian Merchant Marine Committee. In 1950, however, OSK returned to global service. By the end of 1957 the company had almost recovered the sailing rights it had been given by the FEFC before the war, and was making 18 voyages per month on 13 overseas liner routes. Competition was far more intense than before the war, as anyone who had money could construct ships under the government-sponsored shipbuilding program, started in 1947. Before the war, conference members had sought to exclude newcomers. OSK constructed 38 ships under the program. In 1953 OSK established an eastbound route to South America to transport emigrants from Japan. At first the service was profitable, but the number of emigrants fell to below 2,000 per year in 1962. In 1963 OSK established the Japan Emigration Ship Co., Ltd. (JES) to hive off this loss making business. Later, JES was reorganized into Mitsui OSK Passenger Co., Ltd. In this period most of OSK's businesses were loss making. In 1964 it owned 41 vessels totalling . The company was capitalized at ¥7.6 billion and its debts totalled approximately ¥34.9 billion.
ambassador openly criticized Japan's shipping policies in 1955. Japan joined the General Agreement on Tariffs and Trade
(GATT) the same year, and Japan's minister of transport was anxious to settle the issue without dispute. The final proposal of the conference, through the mediation of the minister of transport, contained extremely harsh conditions which MS had to accept, one of which was that MS could only join the FEFC if it operated under the management of NYK for several years. The 39-month battle was over, and MS began placing ships under the auspice of NYK in 1956. Five years later, MS at last joined the conference.
route, and a Great Lakes
route. In 1964 MS owned 45 vessels aggregating . However, MS's performance was disappointing from 1950 until the OSK merger in 1964, when it was capitalized at ¥5.5 billion and had debts of ¥26.7 billion.
Soon after the shipping industry reorganization of 1964, in which Japanese shipping companies were restructured into six groups, world shipping moved toward containerization
. Mitsui O.S.K. Lines, Ltd. (MOL), formed by the merger of OSK and MS, began container services on the California
route, joining a space-charter consortium of four Japanese operators.
Business results improved after the merger, and the loss brought forward was written off in 1966. The company was recapitalized at ¥20 billion in 1968, and at ¥30 billion in 1972. The owned fleet increased to 152 vessels, totalling in 1974, and the operating fleet--owned vessels and time-chartered vessels--numbered 291 vessels, totalling .
route, as part of the TRIO Group consisting of MOL, Nippon Yusen Kaisha, Orient Overseas Container Line
, Ben Line
, and Hapag-Lloyd
, in 1971. On the New York route and Mediterranean routes a container service began in 1972.
carriers, and after the merger MOL held the largest share of the Japanese ore market. The Yachiyosan Maru, at , built in 1970 under a cargo guarantee from Nippon Steel Corporation, was the largest ore carrier in Japan at that time. MOL built Oppama Maru, the first car carrier in Japan, in 1965 under cargo guarantee from Nissan Motor Company. MOL could not carry cars at a low freight rate because it had to stick to the conference rate. Nissan therefore established the Nissan Motor Car Carrier
Co. in 1970 to operate the Oppama Maru and transport its cars. Based on this model, MOL and Honda Motor Co. established the Act Maritime Co. in 1973 to carry Honda cars to the United States.
. MOL immediately cancelled tankers under construction and recorded its best business performance since the merger; freight revenue topped ¥327.5 billion. Soon afterward, however, results deteriorated rapidly and the downslide continued until 1978.
MOL made great efforts to curtail costs, and simultaneously increased the size and number of container ships. Containerization increased on routes between industrially advanced and developing countries, and huge investment was needed to finance this expansion. The development of intermodal transportation on the North America route also began, and MOL introduced a Mini Land Bridge (MLB) service in 1972, using rail transport as well as shipping to reduce transit time, to compete with the U.S. shipping company Sea-Land, extending the service to IPI (Interior Point Intermodal) service in 1980.
Around the time that the MLB service started, the world trade structure began to change and in 1979 about 60% of general cargo from Asia
to the United States came to be loaded at newly industrialized countries (NICs). MOL reorganized its routes, changing its starting ports for U.S. voyages from Japan to Hong Kong, Taiwan, and other NICs, while shipping companies in the newly industrialized countries captured this new demand and branched out into the Pacific routes. The competition in sea transportation increased and MOL began a direct container service between the Far East and the west coast of North America in 1982. MOL invested huge capital to consolidate these services and to establish a service network in the United States.
As a countermeasure against rising oil costs MOL built energy-efficient ships, cooperating with Mitsui Engineering & Shipbuilding. Awobasan Maru, delivered in 1981, was the first ship incorporating innovations that reduced fuel consumption by 30%. In 1974 MOL established the Saudi Arabian Shipping Co., Ltd. (SASCO) and Arabian Marine Operation Co. Ltd. (AMOCO) as joint ventures with the prince of Saudi Arabia
in Jeddah
. SASCO is the shipowner, while AMOCO manages tanker
operations. MOL hoped that this joint venture would give it an advantageous status in any future nationalization of oil, but at first the performance of these companies was not good, and AMOCO acquired the rights to bunker supply in 1977. Two years later the second oil crisis occurred and MOL was able to get a stable bunker supply.
(FOC) ships; its own ships fell in number from 127 in 1975 to 82 in 1982, and the number of employees at sea from 3,127 to 2,233, while freight revenue increased from ¥282 billion to ¥476 billion over the same period. MOL also built highly rationalized ships in cooperation with MES, which would require a crew of only 18, the minimum number accepted by the Seamen's Act, while other ships required 22 or 24. The first super-advanced ship was the Canberra
Maru, delivered in 1979, which was put on the Australia route.
(LNG) on Free on Board (FOB) conditions began as part of the diversification of Japan's energy resources, and MOL, NYK, Kawasaki Steamship, Chubu Electric Power Company, Incorporated and other Japanese electricity and gas companies jointly established two specialized companies, Badak LNG Transport Inc. and Arun, to transport LNG from Indonesia
. These two companies operated seven LNG ships, constructed by MOL and other shipping companies. MOL also took delivery in 1983 of the Kohzan Maru, Japan's first large-sized methanol
carrier, and transported methanol from Saudi Arabia to Japan. Japan's exports of industrial plant grew at that time and modularization began. MOL was interested in the transportation of massive plants and took delivery of five specialized ships, including the Atlas Maru, equipped with a 600-ton capacity derrick
, one of the largest in the world. Plant exports began to decline in the late 1980s and these special ships were mostly sold or changed their flags.
. The conferences on North American routes became extremely weak and freight rates on the routes dropped sharply. Every route between the Far East and the United States made losses and MOL's business performance deteriorated again. Once more, MOL worked hard to curtail expenses and establish greater competitiveness on these routes. In the same year it decided to enlarge its container terminal facilities at Los Angeles
, and also installed its own container terminals at Asian ports, including Kaohsiung
.
MOL also made great efforts to reorganize operations on the Pacific routes, dissolving the consortium of six Japanese companies. In 1985 it began a two-company consortium with Kawasaki Steamship's K Line service (KL) on the Japan/Pacific southwest route, and with East Asiatic Co. (EAC) on the Far East/Pacific southwest route. It also decided to start a three-company consortium with KL and EAC on the Pacific northwest route. On each route it began a weekly service with newly built large container ships. The first such ship, Asian Venture, was an FOC ship at 1,960 20 feet equivalent unit (TEU), indicating the number of containers loaded, and the main ships placed on this route became FOC ships after they were launched in 1984. Moreover, MOL began operating a double stack train service between Los Angeles, Chicago
, and Columbus, Ohio
in 1985 and extended it to New York in the following year.
The New York route became the most competitive because of this trend toward intermodal forms of transport. NYK, Yamashita-Shinnihon Steamship Co.--later merged with Japan Line to establish Nippon Liner Systems for liner business and Navix Lines for tramp business--and MOL began a joint operation service in 1986 and put on it six high-speed large vessels including MOL's Alligator series ships. To improve services, MOL introduced a computer booking system in 1984 and enlarged its online system to cover the United States and the Far East in 1986. This route, however, became lossmaking after 1986, seriously affecting the company's performance; MOL did not pay dividends between 1987 and 1989.
In the same year, the number of directly owned vessels was 54, aggregating , and there were 296 operating vessels, aggregating .
Japan
Japan is an island nation in East Asia. Located in the Pacific Ocean, it lies to the east of the Sea of Japan, China, North Korea, South Korea and Russia, stretching from the Sea of Okhotsk in the north to the East China Sea and Taiwan in the south...
ese transport
Transport
Transport or transportation is the movement of people, cattle, animals and goods from one location to another. Modes of transport include air, rail, road, water, cable, pipeline, and space. The field can be divided into infrastructure, vehicles, and operations...
company headquartered in Toranomon, Minato
Minato, Tokyo
is one of the 23 special wards of Tokyo, Japan. As of 1 March 2008, it had an official population of 217,335 and a population density of 10,865 persons per km². The total area is 20.34 km².Minato hosts 49 embassies...
, Tokyo
Tokyo
, ; officially , is one of the 47 prefectures of Japan. Tokyo is the capital of Japan, the center of the Greater Tokyo Area, and the largest metropolitan area of Japan. It is the seat of the Japanese government and the Imperial Palace, and the home of the Japanese Imperial Family...
. The company's main area of operations is international shipping
Shipping
Shipping has multiple meanings. It can be a physical process of transporting commodities and merchandise goods and cargo, by land, air, and sea. It also can describe the movement of objects by ship.Land or "ground" shipping can be by train or by truck...
. Its alligator
Alligator
An alligator is a crocodilian in the genus Alligator of the family Alligatoridae. There are two extant alligator species: the American alligator and the Chinese alligator ....
logo
Logo
A logo is a graphic mark or emblem commonly used by commercial enterprises, organizations and even individuals to aid and promote instant public recognition...
can be seen on containers in port
Port
A port is a location on a coast or shore containing one or more harbors where ships can dock and transfer people or cargo to or from land....
s around the world.
Founded as a key part of the Mitsui
Mitsui
is one of the largest corporate conglomerates in Japan and one of the largest publicly traded companies in the world.-History:Founded by Mitsui Takatoshi , who was the fourth son of a shopkeeper in Matsusaka, in what is now today's Mie prefecture...
zaibatsu
Zaibatsu
is a Japanese term referring to industrial and financial business conglomerates in the Empire of Japan, whose influence and size allowed for control over significant parts of the Japanese economy from the Meiji period until the end of World War II.-Terminology:...
(family-owned conglomerate
Conglomerate (company)
A conglomerate is a combination of two or more corporations engaged in entirely different businesses that fall under one corporate structure , usually involving a parent company and several subsidiaries. Often, a conglomerate is a multi-industry company...
) during the early industrialization of Japan, the company is now independent of the zaibatsu, but remains part of the Mitsui keiretsu
Keiretsu
A is a set of companies with interlocking business relationships and shareholdings. It is a type of business group. The keiretsu has maintained dominance over the Japanese economy for the greater half of the twentieth century....
(group of aligned companies).
Many heads of this company have wielded considerable power in Japan and abroad. One of the latest is Masaharu Ikuta
Masaharu Ikuta
is Japanese businessman from Kobe, Hyogo. He graduated from Keio University.He was the former CEO of Mitsui O.S.K. Lines, and was the president of the Japan Postal Agency 2003 to March 2007.- References :...
, who has been appointed to head the newly privatized
Privatization
Privatization is the incidence or process of transferring ownership of a business, enterprise, agency or public service from the public sector to the private sector or to private non-profit organizations...
Japan Post
Japan Post
was a government-owned corporation in Japan, that existed from 2003–2007, offering postal and package delivery services, banking services, and life insurance. It had over 400,000 employees and ran 24,700 post offices throughout Japan and was the nation's largest employer. One third of all Japanese...
.
History
MOL (Mitsui O.S.K. Lines) was founded in 1964 following the merger of and Mitsui Steamship Co., Ltd., formerly Mitsui Line, under the Law Concerning the Reconstruction and Reorganization of the Shipping Industry. At that time the company was the largest shipping company in Japan, capitalized at ¥13.1 billion, with 83 vessels aggregating .OSK
OSK was founded in 1884 when 55 ship owners, each of whom had only a small number of vessels, combined their operations. The chief representative of these ship owners was Hirose Saihei, senior manager of the Sumitomo zaibatsu, or conglomerate, and a prominent figure in OsakaOsaka
is a city in the Kansai region of Japan's main island of Honshu, a designated city under the Local Autonomy Law, the capital city of Osaka Prefecture and also the biggest part of Keihanshin area, which is represented by three major cities of Japan, Kyoto, Osaka and Kobe...
financial circles. OSK was capitalized at ¥1.2 million, with 93 vessels totalling .
In the first few years its routes were limited to coastal services in the western area of Japan. In 1890 OSK inaugurated an Osaka-Pusan run followed in 1893 by the operation of an Osaka-Incheon
Incheon
The Incheon Metropolitan City is located in northwestern South Korea. The city was home to just 4,700 people when Jemulpo port was built in 1883. Today 2.76 million people live in the city, making it Korea’s third most populous city after Seoul and Busan Metropolitan City...
route and Korean coastal services. The company was recapitalized at ¥1.8 million in 1893, rising to ¥2.5 million in 1894, to ¥5 million in 1896, when the government of Taiwan
Taiwan
Taiwan , also known, especially in the past, as Formosa , is the largest island of the same-named island group of East Asia in the western Pacific Ocean and located off the southeastern coast of mainland China. The island forms over 99% of the current territory of the Republic of China following...
granted OSK subsidies for Osaka-Taiwan liner services, and to ¥10 million in 1898 when the company started to operate on the Yangtze River.
In 1898 Tokugoro Nakahashi became the company's fourth president. He made a great effort to rationalize the internal organization of OSK, to penetrate the Chinese market, and also to inaugurate the first OSK ocean route, a Hong Kong
Hong Kong
Hong Kong is one of two Special Administrative Regions of the People's Republic of China , the other being Macau. A city-state situated on China's south coast and enclosed by the Pearl River Delta and South China Sea, it is renowned for its expansive skyline and deep natural harbour...
to Tacoma, Washington
Tacoma, Washington
Tacoma is a mid-sized urban port city and the county seat of Pierce County, Washington, United States. The city is on Washington's Puget Sound, southwest of Seattle, northeast of the state capital, Olympia, and northwest of Mount Rainier National Park. The population was 198,397, according to...
service, in 1908. In 1911 OSK started a Kobe
Kobe
, pronounced , is the fifth-largest city in Japan and is the capital city of Hyōgo Prefecture on the southern side of the main island of Honshū, approximately west of Osaka...
to Bombay service. The route was under the monopoly of the Far Eastern Freight Conference (FEFC) of which Nippon Yusen K.K. (NYK) was the only Japanese member. OSK fought against the FEFC and was admitted to the conference in 1913. In 1918 the company opened a Bombay to Marseilles route and was admitted to full membership of the FEFC. Meanwhile, it opened a San Francisco route, an Australia
Australia
Australia , officially the Commonwealth of Australia, is a country in the Southern Hemisphere comprising the mainland of the Australian continent, the island of Tasmania, and numerous smaller islands in the Indian and Pacific Oceans. It is the world's sixth-largest country by total area...
route, and a South America
South America
South America is a continent situated in the Western Hemisphere, mostly in the Southern Hemisphere, with a relatively small portion in the Northern Hemisphere. The continent is also considered a subcontinent of the Americas. It is bordered on the west by the Pacific Ocean and on the north and east...
route, offering a worldwide liner service. It began a New York
New York
New York is a state in the Northeastern region of the United States. It is the nation's third most populous state. New York is bordered by New Jersey and Pennsylvania to the south, and by Connecticut, Massachusetts and Vermont to the east...
service in 1920 but operated at a deficit. In 1930 OSK made a huge investment in five new high-speed motor ships in order to start a New York express service. This service entirely transformed raw-silk
Silk
Silk is a natural protein fiber, some forms of which can be woven into textiles. The best-known type of silk is obtained from the cocoons of the larvae of the mulberry silkworm Bombyx mori reared in captivity...
transportation from Asia to America; raw silk began to be carried by water all the way to New York instead of going by land. OSK's share of cargo shipped on this route grew, and its business performance improved in spite of unfavourable business conditions.
During the Great Depression
Great Depression
The Great Depression was a severe worldwide economic depression in the decade preceding World War II. The timing of the Great Depression varied across nations, but in most countries it started in about 1929 and lasted until the late 1930s or early 1940s...
, OSK and NYK made a cooperative agreement in 1931 whereby OSK abolished its Puget Sound
Puget Sound
Puget Sound is a sound in the U.S. state of Washington. It is a complex estuarine system of interconnected marine waterways and basins, with one major and one minor connection to the Strait of Juan de Fuca and the Pacific Ocean — Admiralty Inlet being the major connection and...
route, which had called at Tacoma and Seattle, and in turn acquired a monopoly on the South American east coast route. OSK quickly recovered from the deficits of 1930 and 1931, and resumed paying dividends in 1932.
The company's profits peaked in 1941, when OSK was capitalized at ¥87 million and had 112 vessels aggregating .
Mitsui Bussan Kaisha
The Mitsui Line was originally the shipping department of the trading company Mitsui Bussan Kaisha. Mitsui Bussan was established in 1876 and obtained exclusive rights to export and market the coalCoal
Coal is a combustible black or brownish-black sedimentary rock usually occurring in rock strata in layers or veins called coal beds or coal seams. The harder forms, such as anthracite coal, can be regarded as metamorphic rock because of later exposure to elevated temperature and pressure...
mined at the state-run Miike mines. It chartered boats and transported coal on its own account. In 1878 it bought a steamship, and in 1888 it bought the mines. Mitsui Bussan became an industrial carrier and the shipping section was established in 1898. The section expanded to become the Shipping Department and moved to Kobe in 1904. The company then owned 9 ships aggregating , and on the eve of World War I
World War I
World War I , which was predominantly called the World War or the Great War from its occurrence until 1939, and the First World War or World War I thereafter, was a major war centred in Europe that began on 28 July 1914 and lasted until 11 November 1918...
the fleet totalled 15 ships with , increasing to 30 ships totalling in 1919. The third general manager, Teijiro Kawamura, expanded the business of the department during World War I; in 1914 it began a tramp service carrying the company's own cargo and that of other companies. In 1917 it constructed a shipyard and set up the shipbuilding department and in 1920 it opened a semi-liner service from Dalian
Dalian
Dalian is a major city and seaport in the south of Liaoning province, Northeast China. It faces Shandong to the south, the Yellow Sea to the east and the Bohai Sea to the west and south. Holding sub-provincial administrative status, Dalian is the southernmost city of Northeast China and China's...
via Kobe to Seattle, whereby a liner service operated on outbound voyages but on the return voyage, owing to insufficient cargo at Seattle, ships had to stop and collect cargo at other ports.
Mitsui Bussan's Shipping Department built two sister ships in 1924. One was equipped with reciprocal oil-burners, the other had diesel engines and was the first ocean-going diesel ship in Japan. The department put these ships on the North American route and compared their performance. Akagisan Maru, the diesel ship, proved superior, and Mitsui concluded a manufacturing and marketing license agreement with Burmeister and Wain Co. (B & W), who had manufactured the engine, in 1926. In 1928 Mitsui opened a Bangkok
Bangkok
Bangkok is the capital and largest urban area city in Thailand. It is known in Thai as Krung Thep Maha Nakhon or simply Krung Thep , meaning "city of angels." The full name of Bangkok is Krung Thep Mahanakhon Amon Rattanakosin Mahintharayutthaya Mahadilok Phop Noppharat Ratchathani Burirom...
route, in 1931 a Philippines
Philippines
The Philippines , officially known as the Republic of the Philippines , is a country in Southeast Asia in the western Pacific Ocean. To its north across the Luzon Strait lies Taiwan. West across the South China Sea sits Vietnam...
route, in 1932 a Dalien to New York route, and in 1935 a Persian Gulf
Persian Gulf
The Persian Gulf, in Southwest Asia, is an extension of the Indian Ocean located between Iran and the Arabian Peninsula.The Persian Gulf was the focus of the 1980–1988 Iran-Iraq War, in which each side attacked the other's oil tankers...
route. From 1933 the Shipping Department became known as Mitsui Line. In 1937 it owned 35 ships aggregating . The shipbuilding department was separated off as the Mitsui Tama Shipyard in 1937, and in 1942 the former Shipping Department too became a separate company, Mitsui Steamship Co., Ltd. (MS). It was capitalized at ¥50 million, and Takaharu Mitsui was elected chairman.
World War II
During World War IIWorld War II
World War II, or the Second World War , was a global conflict lasting from 1939 to 1945, involving most of the world's nations—including all of the great powers—eventually forming two opposing military alliances: the Allies and the Axis...
OSK, like other Japanese shipping companies, was forced to be a mere ship owner. When the war ended it had only 55 vessels left, totalling 143,976 grt, most of which were so-called wartime standard ships, of poor quality. All ships were under control of the Allied powers through the Civilian Merchant Marine Committee. In 1950, however, OSK returned to global service. By the end of 1957 the company had almost recovered the sailing rights it had been given by the FEFC before the war, and was making 18 voyages per month on 13 overseas liner routes. Competition was far more intense than before the war, as anyone who had money could construct ships under the government-sponsored shipbuilding program, started in 1947. Before the war, conference members had sought to exclude newcomers. OSK constructed 38 ships under the program. In 1953 OSK established an eastbound route to South America to transport emigrants from Japan. At first the service was profitable, but the number of emigrants fell to below 2,000 per year in 1962. In 1963 OSK established the Japan Emigration Ship Co., Ltd. (JES) to hive off this loss making business. Later, JES was reorganized into Mitsui OSK Passenger Co., Ltd. In this period most of OSK's businesses were loss making. In 1964 it owned 41 vessels totalling . The company was capitalized at ¥7.6 billion and its debts totalled approximately ¥34.9 billion.
Select list of ships
- Argentina Maru
- Arimasan Maru
- Azumasan Maru (1933)Azumasan Maru (1933)The Azumasan Maru was a 7,623 gross ton freighter that was built by Mitsui Bussan Kaisha, Tama for Mitsui Bussan Kaisha launched in 1933. She was requisitioned by the Imperial Japanese Navy and fitted out as a troop transport....
1950-1964
During World War II, and after the war, all MS ships were under the control of the government. When Japan lost the war in 1945, only 17 of MS's vessels were left, increasing to 22 vessels totalling when MS re-acquired operations that had previously been chartered out to the Civilian Merchant Marine Committee (CMMC).Post-War
MS then began a vigorous expansion of its fleet and routes to re-establish its pre-war network, and went so far as to apply to the FEFC. When its application was rejected, MS placed outsider--non-conference-member--ships on this route in 1953. After a long struggle, the conference attempted to resolve the issue politically and the BritishUnited Kingdom
The United Kingdom of Great Britain and Northern IrelandIn the United Kingdom and Dependencies, other languages have been officially recognised as legitimate autochthonous languages under the European Charter for Regional or Minority Languages...
ambassador openly criticized Japan's shipping policies in 1955. Japan joined the General Agreement on Tariffs and Trade
General Agreement on Tariffs and Trade
The General Agreement on Tariffs and Trade was negotiated during the UN Conference on Trade and Employment and was the outcome of the failure of negotiating governments to create the International Trade Organization . GATT was signed in 1947 and lasted until 1993, when it was replaced by the World...
(GATT) the same year, and Japan's minister of transport was anxious to settle the issue without dispute. The final proposal of the conference, through the mediation of the minister of transport, contained extremely harsh conditions which MS had to accept, one of which was that MS could only join the FEFC if it operated under the management of NYK for several years. The 39-month battle was over, and MS began placing ships under the auspice of NYK in 1956. Five years later, MS at last joined the conference.
Shipbuilding
MS constructed 38 vessels between 1950 and its merger with OSK in 1964, and its operating tonnage was the largest in Japan. One of its ships, Kinkasan Maru, was the first bridge-controlled ship in the world. MS planned to rationalize its crews and at the same time improve the working conditions of engineers. It cooperated with Mitsui Shipbuilding & Engineering Co., a direct successor of Mitsui Tama Shipyard, and designed innovatory bridge-controlled ships. The Kinkasan Maru was delivered in 1961 and MS placed it, along with another bridge-controlled ship, on the New York route, which was re-opened in 1951. Besides the New York route, MS operated westbound and eastbound routes around the world, a Central and South America route, a West AfricaWest Africa
West Africa or Western Africa is the westernmost region of the African continent. Geopolitically, the UN definition of Western Africa includes the following 16 countries and an area of approximately 5 million square km:-Flags of West Africa:...
route, and a Great Lakes
Great Lakes
The Great Lakes are a collection of freshwater lakes located in northeastern North America, on the Canada – United States border. Consisting of Lakes Superior, Michigan, Huron, Erie, and Ontario, they form the largest group of freshwater lakes on Earth by total surface, coming in second by volume...
route. In 1964 MS owned 45 vessels aggregating . However, MS's performance was disappointing from 1950 until the OSK merger in 1964, when it was capitalized at ¥5.5 billion and had debts of ¥26.7 billion.
Mitsui-OSK merger
Containerization
Containerization is a system of freight transport based on a range of steel intermodal containers...
. Mitsui O.S.K. Lines, Ltd. (MOL), formed by the merger of OSK and MS, began container services on the California
California
California is a state located on the West Coast of the United States. It is by far the most populous U.S. state, and the third-largest by land area...
route, joining a space-charter consortium of four Japanese operators.
Business results improved after the merger, and the loss brought forward was written off in 1966. The company was recapitalized at ¥20 billion in 1968, and at ¥30 billion in 1972. The owned fleet increased to 152 vessels, totalling in 1974, and the operating fleet--owned vessels and time-chartered vessels--numbered 291 vessels, totalling .
Containerization
The first container ship, MOL's America Maru, sailed from Kobe to San Francisco in October 1969. Containerization spread to other routes, including the Australia route, with NYK and Yamashita-Shinnihon Steamship Co., in 1970; the North Pacific route, with five other Japanese companies, in 1971; and the EuropeEurope
Europe is, by convention, one of the world's seven continents. Comprising the westernmost peninsula of Eurasia, Europe is generally 'divided' from Asia to its east by the watershed divides of the Ural and Caucasus Mountains, the Ural River, the Caspian and Black Seas, and the waterways connecting...
route, as part of the TRIO Group consisting of MOL, Nippon Yusen Kaisha, Orient Overseas Container Line
Orient Overseas Container Line
Orient Overseas Container Line is a Hong Kong-based container shipping and logistics service company.OOCL is one of the world's largest shipping and logistics companies with more than 280 offices in 55 countries around the world, providing 78 services covering international trading markets with a...
, Ben Line
Ben Line
The Ben Line or Ben Line Steamers, Limited was a Scottish shipping company based at Leith, Scotland which specialised in the fast carriage of cargo to and from the Far East...
, and Hapag-Lloyd
Hapag-Lloyd
Hapag-Lloyd is a German transportation company comprising a cargo container shipping line, Hapag-Lloyd AG, which in turn owns other subsidiaries such as Hapag-Lloyd Ships and a cruise line, Hapag-Lloyd Cruises which is now integrated into TUI AG, Hanover...
, in 1971. On the New York route and Mediterranean routes a container service began in 1972.
Carrying ore
The other trend was toward specialization. Both OSK and MS had oreOre
An ore is a type of rock that contains minerals with important elements including metals. The ores are extracted through mining; these are then refined to extract the valuable element....
carriers, and after the merger MOL held the largest share of the Japanese ore market. The Yachiyosan Maru, at , built in 1970 under a cargo guarantee from Nippon Steel Corporation, was the largest ore carrier in Japan at that time. MOL built Oppama Maru, the first car carrier in Japan, in 1965 under cargo guarantee from Nissan Motor Company. MOL could not carry cars at a low freight rate because it had to stick to the conference rate. Nissan therefore established the Nissan Motor Car Carrier
Nissan Motor Car Carrier
is a Japanese international shipping company, which specializes in marine transport of cargoes such as automobiles, heavy construction machinery and any type of rolling freights....
Co. in 1970 to operate the Oppama Maru and transport its cars. Based on this model, MOL and Honda Motor Co. established the Act Maritime Co. in 1973 to carry Honda cars to the United States.
Oil Crisis
The U.S. gold embargo in 1971 and the advent of a floating world monetary system was a severe blow for MOL. It changed its financial strategy, keeping more funds in U.S. dollars and in other currencies. More serious was the 1973 oil crisis1973 oil crisis
The 1973 oil crisis started in October 1973, when the members of Organization of Arab Petroleum Exporting Countries or the OAPEC proclaimed an oil embargo. This was "in response to the U.S. decision to re-supply the Israeli military" during the Yom Kippur war. It lasted until March 1974. With the...
. MOL immediately cancelled tankers under construction and recorded its best business performance since the merger; freight revenue topped ¥327.5 billion. Soon afterward, however, results deteriorated rapidly and the downslide continued until 1978.
MOL made great efforts to curtail costs, and simultaneously increased the size and number of container ships. Containerization increased on routes between industrially advanced and developing countries, and huge investment was needed to finance this expansion. The development of intermodal transportation on the North America route also began, and MOL introduced a Mini Land Bridge (MLB) service in 1972, using rail transport as well as shipping to reduce transit time, to compete with the U.S. shipping company Sea-Land, extending the service to IPI (Interior Point Intermodal) service in 1980.
Around the time that the MLB service started, the world trade structure began to change and in 1979 about 60% of general cargo from Asia
Asia
Asia is the world's largest and most populous continent, located primarily in the eastern and northern hemispheres. It covers 8.7% of the Earth's total surface area and with approximately 3.879 billion people, it hosts 60% of the world's current human population...
to the United States came to be loaded at newly industrialized countries (NICs). MOL reorganized its routes, changing its starting ports for U.S. voyages from Japan to Hong Kong, Taiwan, and other NICs, while shipping companies in the newly industrialized countries captured this new demand and branched out into the Pacific routes. The competition in sea transportation increased and MOL began a direct container service between the Far East and the west coast of North America in 1982. MOL invested huge capital to consolidate these services and to establish a service network in the United States.
As a countermeasure against rising oil costs MOL built energy-efficient ships, cooperating with Mitsui Engineering & Shipbuilding. Awobasan Maru, delivered in 1981, was the first ship incorporating innovations that reduced fuel consumption by 30%. In 1974 MOL established the Saudi Arabian Shipping Co., Ltd. (SASCO) and Arabian Marine Operation Co. Ltd. (AMOCO) as joint ventures with the prince of Saudi Arabia
Saudi Arabia
The Kingdom of Saudi Arabia , commonly known in British English as Saudi Arabia and in Arabic as as-Sa‘ūdiyyah , is the largest state in Western Asia by land area, constituting the bulk of the Arabian Peninsula, and the second-largest in the Arab World...
in Jeddah
Jeddah
Jeddah, Jiddah, Jidda, or Jedda is a city located on the coast of the Red Sea and is the major urban center of western Saudi Arabia. It is the largest city in Makkah Province, the largest sea port on the Red Sea, and the second largest city in Saudi Arabia after the capital city, Riyadh. The...
. SASCO is the shipowner, while AMOCO manages tanker
Tanker (ship)
A tanker is a ship designed to transport liquids in bulk. Major types of tankship include the oil tanker, the chemical tanker, and the liquefied natural gas carrier.-Background:...
operations. MOL hoped that this joint venture would give it an advantageous status in any future nationalization of oil, but at first the performance of these companies was not good, and AMOCO acquired the rights to bunker supply in 1977. Two years later the second oil crisis occurred and MOL was able to get a stable bunker supply.
Scaling back
Personnel expenses increased after the first oil crisis, and the yen was revalued. These changes hit MOL heavily as a large part of its income was in U.S. dollars. To make itself more competitive, MOL reduced the number of its own vessels and increased the number of flag of convenienceFlag of convenience
The term flag of convenience describes the business practice of registering a merchant ship in a sovereign state different from that of the ship's owners, and flying that state's civil ensign on the ship. Ships are registered under flags of convenience to reduce operating costs or avoid the...
(FOC) ships; its own ships fell in number from 127 in 1975 to 82 in 1982, and the number of employees at sea from 3,127 to 2,233, while freight revenue increased from ¥282 billion to ¥476 billion over the same period. MOL also built highly rationalized ships in cooperation with MES, which would require a crew of only 18, the minimum number accepted by the Seamen's Act, while other ships required 22 or 24. The first super-advanced ship was the Canberra
Canberra
Canberra is the capital city of Australia. With a population of over 345,000, it is Australia's largest inland city and the eighth-largest city overall. The city is located at the northern end of the Australian Capital Territory , south-west of Sydney, and north-east of Melbourne...
Maru, delivered in 1979, which was put on the Australia route.
Passenger service
In 1970 MOL established Mitsui OSK Passenger Co., Ltd. (MOP), with the reorganization of JES. MOP has three passenger ships. The company was the only one in Japan to operate an ocean-going passenger service at that time, but later in the 1990s a few Japanese shipping companies entered this market to cope with the boom in travelling by sea.LNG
In 1983 the import of liquefied natural gasLiquefied natural gas
Liquefied natural gas or LNG is natural gas that has been converted temporarily to liquid form for ease of storage or transport....
(LNG) on Free on Board (FOB) conditions began as part of the diversification of Japan's energy resources, and MOL, NYK, Kawasaki Steamship, Chubu Electric Power Company, Incorporated and other Japanese electricity and gas companies jointly established two specialized companies, Badak LNG Transport Inc. and Arun, to transport LNG from Indonesia
Indonesia
Indonesia , officially the Republic of Indonesia , is a country in Southeast Asia and Oceania. Indonesia is an archipelago comprising approximately 13,000 islands. It has 33 provinces with over 238 million people, and is the world's fourth most populous country. Indonesia is a republic, with an...
. These two companies operated seven LNG ships, constructed by MOL and other shipping companies. MOL also took delivery in 1983 of the Kohzan Maru, Japan's first large-sized methanol
Methanol
Methanol, also known as methyl alcohol, wood alcohol, wood naphtha or wood spirits, is a chemical with the formula CH3OH . It is the simplest alcohol, and is a light, volatile, colorless, flammable liquid with a distinctive odor very similar to, but slightly sweeter than, ethanol...
carrier, and transported methanol from Saudi Arabia to Japan. Japan's exports of industrial plant grew at that time and modularization began. MOL was interested in the transportation of massive plants and took delivery of five specialized ships, including the Atlas Maru, equipped with a 600-ton capacity derrick
Derrick
A derrick is a lifting device composed of one tower, or guyed mast such as a pole which is hinged freely at the bottom. It is controlled by lines powered by some means such as man-hauling or motors, so that the pole can move in all four directions. A line runs up it and over its top with a hook on...
, one of the largest in the world. Plant exports began to decline in the late 1980s and these special ships were mostly sold or changed their flags.
Restructuring
In 1984 the Maritime Act of the United States was revised and the mandatory independent action clause was introduced. This gave shipping companies the right to introduce a discount tariff if registered at the Federal Maritime CommissionFederal Maritime Commission
The United States Federal Maritime Commission is an independent federal agency, based in Washington D.C., responsible for the regulation of oceanborne transportation in the foreign commerce of the U.S.-Mission:The FMC:...
. The conferences on North American routes became extremely weak and freight rates on the routes dropped sharply. Every route between the Far East and the United States made losses and MOL's business performance deteriorated again. Once more, MOL worked hard to curtail expenses and establish greater competitiveness on these routes. In the same year it decided to enlarge its container terminal facilities at Los Angeles
Los Ángeles
Los Ángeles is the capital of the province of Biobío, in the commune of the same name, in Region VIII , in the center-south of Chile. It is located between the Laja and Biobío rivers. The population is 123,445 inhabitants...
, and also installed its own container terminals at Asian ports, including Kaohsiung
Kaohsiung
Kaohsiung is a city located in southwestern Taiwan, facing the Taiwan Strait on the west. Kaohsiung, officially named Kaohsiung City, is divided into thirty-eight districts. The city is one of five special municipalities of the Republic of China...
.
MOL also made great efforts to reorganize operations on the Pacific routes, dissolving the consortium of six Japanese companies. In 1985 it began a two-company consortium with Kawasaki Steamship's K Line service (KL) on the Japan/Pacific southwest route, and with East Asiatic Co. (EAC) on the Far East/Pacific southwest route. It also decided to start a three-company consortium with KL and EAC on the Pacific northwest route. On each route it began a weekly service with newly built large container ships. The first such ship, Asian Venture, was an FOC ship at 1,960 20 feet equivalent unit (TEU), indicating the number of containers loaded, and the main ships placed on this route became FOC ships after they were launched in 1984. Moreover, MOL began operating a double stack train service between Los Angeles, Chicago
Chicago
Chicago is the largest city in the US state of Illinois. With nearly 2.7 million residents, it is the most populous city in the Midwestern United States and the third most populous in the US, after New York City and Los Angeles...
, and Columbus, Ohio
Columbus, Ohio
Columbus is the capital of and the largest city in the U.S. state of Ohio. The broader metropolitan area encompasses several counties and is the third largest in Ohio behind those of Cleveland and Cincinnati. Columbus is the third largest city in the American Midwest, and the fifteenth largest city...
in 1985 and extended it to New York in the following year.
The New York route became the most competitive because of this trend toward intermodal forms of transport. NYK, Yamashita-Shinnihon Steamship Co.--later merged with Japan Line to establish Nippon Liner Systems for liner business and Navix Lines for tramp business--and MOL began a joint operation service in 1986 and put on it six high-speed large vessels including MOL's Alligator series ships. To improve services, MOL introduced a computer booking system in 1984 and enlarged its online system to cover the United States and the Far East in 1986. This route, however, became lossmaking after 1986, seriously affecting the company's performance; MOL did not pay dividends between 1987 and 1989.
Internationalization
MOL's financial activities became more international after the first oil crisis. The company issued corporate debentures and warrant bonds on the Swiss capital market. Shareholders' equity was ¥57.36 billion, and net income ¥5.94 billion in 1991.In the same year, the number of directly owned vessels was 54, aggregating , and there were 296 operating vessels, aggregating .
Select list of ships
- America Maru
Bulk carriers
- Aurora Light
- Brasil Maru
- Crystal Pioneer (woodchip carrier)
- Energia Centaurus
- Envoyager
- Hokuetsu Delight (woodchip carrier)
- Mona Linden
- Grandis
- Shiyo
- KN Arcadia
- Pleiades Dream
- Vega Dream
- Enchanter
- Sea Navigator
- Zebra Wind
Car carriers
- Aquamarine Ace
- Eternal Ace
- Camelia Ace
- Cougar AceCougar AceThe MV Cougar Ace is a Singapore-flagged roll-on/roll-off car carrier vessel. The Cougar Ace was built by Kanasashi Co., of Toyohashi, Japan and launched in June 1993. Specifications cite a length of 199m, draft of 9.72m, beam of 32.26m and a maximum speed of 18.6 knots. Her Gross Tonnage is...
- Mercury Ace
- Sapphire Ace
- Palnet Ace
- Bravery Ace
- Sanderling Ace
- Amethyst Ace
- Euphony Ace
- Pearl Ace
- Galaxy Ace
- Swan Ace
- Swallow Ace
- Liberty Ace
- Freedom Ace
- Sunshine Ace
- Tranquil Ace
- Heroic AceHeroic aceM.V.Heroic Ace is a PCTC owned by M.O.L .She was built in 2003, at the Minaminippon shipyard, in the Inland Sea, Japan, as part of a series of 12 large car carriers...
- Prominent Ace
- Swift Ace
- Bergamot Ace
Tankers
- Great Tribute - LPG Carrier
- Millennium Explorer - Methanol Carrier
- Noble Spirit - Methanol Carrier
- Vemillion Express - Product Tanker
- Azumasan
- Yakumasan
- Atlantic Pioneer
- Atlantic Explorer
- Pacific Voyager
- Pacific Alliance
- Guanabara
- Pacific Partner
- Atlantic Liberty
- Atlantic Prosperity
- Opal Express
- Noble Express
- Ivy Express
- Breezy Victoria
- Advance Victoria
- Glen May
- Ambassador Norris
- Las Cuevas
- Pigeon Point
- San Fernando
- Maracas Bay
- Nariva
- Naparima
- Saamis Adventurer
- Princess Naomi
Container ships
- MOL Endurance
- MOL Enterprise
- MOL Endeavor
- MOL Efficiency
- MOL Celebration
- MOL Competence
- MOL Creation
- MOL Cosmos
- MOL Matrix
- MOL Maestro
- MOL Marvel
- MOL Mission
- MOL Maneuver
- MOL Prestige (Intermittently called MSC PrestigeMSC PrestigeMSC Prestige was a container ship that collided with a large tanker MV Samco Europe, off the Red Sea traffic separation scheme of Bab-el-Mandeb on 7 December 2007....
when she was under charter to MSC)
Principal subsidiaries
- International Energy Transport Co., Ltd. (45%)
- International Marine Transport Co., Ltd. (58%)
- Mitsui OSK Passenger Line Co., Ltd. (51%)
- M.O. Seaways, Ltd. (99%)
- International Container Terminal (92%)
- The Shosen Koun (62%)
- Trans Pacific Container Service (90%)
- Japan Express Co., Ltd. (Kobe) (86%)
- Japan Express Co., Ltd. (Yokohama) (81%)
- Blue Highway Line (25.4%)
- Kusakabe Steamship Co., Ltd. (80%)
- Mitsui OSK Kogyo Kaisha, Ltd. (79%)
- Euromol B.V. (100%)
- MOL International S.A. (100%)
- Orange Finance Ltd. (100%)
- Arabian Marine Bunker Sales Co., Ltd. (90%)