Tonnage Titans – 4. NYK Line

NYK president Tadaaki Naito.

NYK president Tadaaki Naito. Credit: NYK

One of the world’s oldest shipping companies, Nippon Yusen Kabushiki Kaisha (NYK Line), traces its origins to the establishment of Tsukumo Shokai Shipping Company in 1870. In 1875, Tsukumo Shokai was renamed Mitsubishi Shokai (subsequently renamed Mitsubishi Mail Steamship Company) and launched Japan’s first passenger liner service.

In 1885, Mitsubishi Mail Steamship Company merged with another Japanese shipping company, Kyodo Unyu Kaisha. NYK Line took on its current name when this entity became a joint stock company in 1893.

NYK Line has been part of the Mitsubishi business group, notwithstanding the changes the company has undergone in the last century.

The company dominated Japan’s shipping scene in the early 20th century, transporting goods and passengers worldwide, with passenger services at the core of its business.

During the Second World War, NYK Line provided military transport and hospital ships for the Imperial Japanese Army and Navy. The Allied Powers sank many of NYK Line’s ships, leaving the company with only 37 vessels by the time Japan surrendered in August 1945.

As NYK Line began rebuilding its business in the 1950s, the advent of air travel saw dwindling demand for passenger liner services. In response, NYK Line expanded its cargo services, a move that coincided with containerisation.

NYK Line launched Japan’s first container ship, Hakone Maruon a route to California in 1968 and subsequently opened container services to other ports.

In 1964, NYK Line merged with Mitsubishi Shipping Co, taking the combined owned fleet to 87 vessels. The company’s growth continued over the next few decades and is now Japan’s second-largest shipping group after Mitsui OSK Lines.

Today, NYK Line’s daily operations is overseen by its president, Tadaaki Naito.

According to IHS Markit data, NYK Line has a total capacity of 23,261,712 gt, made up of 378 in-service vessels. The group has 14 ships on order, totalling 1,621,800 gt, comprising five VLCCs, four LNG carriers, two LPG carriers, one product tanker, and two tugs. The vessels are being constructed by Japan Marine United Corporation, Namura Shipbuilding, Mitsubishi Heavy Industries, and Kanrei Naruto.

Besides shipping, NYK Line is active in the provision of third-party logistics, air cargo, and real estate.

It should be noted that NYK Line’s container ships now service Ocean Network Express, after it merged its box services with compatriots Mitsui OSK Lines and “K” Line on 1 April.

Besides the owned fleet, NYK Line operates a significant number of chartered vessels. According to the company’s latest annual report, NYK Line had about 400 ships on charter, mainly from Japanese family-owned tonnage providers.

With more than 100 pure-car carriers in operation, NYK Line is regarded as the largest player in this segment, a result of long-term contracts in place with Japanese car makers.

Typical of Japanese operators, NYK Line has a good number of dedicated shipping contracts in place, with its very large crude carriers committed to refiners such as Idemitsu Kosan and Repsol. The company’s gas carriers are tied to long-term contracts with entities that include Tokyo Electric Power Company, Petronet LNG, and Chubu Electric Power.

The company is also seen as a major operator of bulk carriers, with more than 400 vessels in operation.

The fleet of bulk carriers and general cargo vessels are operated by subsidiaries, such as NYK Bulk & Projects Carriers in Japan and NYK Bulkship (Asia) in Singapore. These ships transport cargoes such as wood chips, iron ore, coal and grains, with clients including Vale SA, BHP Billiton, Hokuetsu Kishu Paper, and Nippon Steel & Sumitomo Metal Corporation.