Supply Chain · Profile from Supply Chain Research Companion
Hanjin Shipping
South Korea's largest container line and the world's seventh-largest (~3% of global capacity, reported), founded in 1977 by the Hanjin Group's founder Cho Choong-hoon (whose group also owned Korean Air), which filed for court receivership in Seoul on 31 Aug 2016 and was declared bankrupt on 17 Feb 2017 — the largest container-line failure in history. In the weeks after the filing, ports and terminals around the world refused to unload its ships for fear of not being paid; dozens of vessels drifted at anchor with cargo worth an estimated ~$14bn (a Wall Street Journal estimate of early Sep 2016, repeated by Reuters and others; method undisclosed — treat as a press estimate; one party counted ~93 ships at 51 ports, another ~85 ships around 50 ports in 26 countries) weeks before the US holiday season. The United States became the place where the rescue of that cargo was improvised: Hanjin filed for Chapter 15 recognition in the US Bankruptcy Court in Newark, New Jersey on 2 Sep 2016; Judge John K. Sherwood granted interim protection (6 Sep) and provisional relief (9 Sep) conditioned on a cargo protocol, and Korean Air and the group chairman's emergency money paid stevedores so ships could berth at Long Beach and other US ports (reported). Its terminal stake at Long Beach (TTI) was sold out of bankruptcy to MSC's TiL (80%) and HMM (20%) for ~$78m (reported). Its story turns on capital matched to the cycle — and what a carrier's failure does to its customers.
At a glance
- Founded
- 1977 (May 1977, verify) by Cho Choong-hoon, founder of the Hanjin Group (Korean Air, Hanjin Transportation, Hanjin Heavy Industries)
- Headquarters
- Seoul (Yeouido), South Korea
- Ownership / structure
- Listed (KRX); controlled through Hanjin family holding companies — Cho Soo-ho's branch (to 2006), his widow Choi Eun-young (2007–14), then Korean Air under Cho Yang-ho (2014–16) (reported)
- Leadership (2016)
- Chairman Cho Yang-ho (Korean Air and Hanjin Group chairman); CEO Suk Tae-soo (verify)
- Scale at failure
- ~0.6m TEU, ~95–100 ships (owned and chartered), ~3% of world capacity, seventh-largest carrier (reported, verify); debt reported ~₩5.6tn (~$5bn, verify)
- US footprint
- Transpacific services to Long Beach, Los Angeles, Oakland, Seattle/Tacoma and the East Coast; majority stake in Total Terminals International (TTI) at Pier T, Long Beach (~54%, reported, verify), with TiL as partner; Seattle terminal (verify); US agency organisation (Hanjin Shipping America, verify)
- Alliances
- CKYH (COSCO, K Line, Yang Ming, Hanjin; from the 2000s), CKYHE with Evergreen (from 2014); signed to join THE Alliance from Apr 2017 (May 2016, reported) — never sailed in it
- Signature moves (incl. failures)
- 1977 founding; the 1988 Korea Shipping Corporation merger; DSR-Senator Lines (1997); TTI Long Beach (early 2000s); Korean Air's 2014 takeover of management; receivership and stranded ships (2016, failure); US Chapter 15 protection (2016); bankruptcy and asset sales (2017, failure)
8 strategic moves analysed
Each one gets a full strategy file in the companion: context, the decision, the financing, what happened, and the lesson.
1977
Founding
Founding
1988
Korea Shipping Corporation Merger
Acquisition or merger
1997
DSR Senator Lines Stake
Acquisition (controlling stake in a foreign carrier)
2002
TTI Pier T Long Beach Terminal
Network build (US terminal)
2014
Korean Air Takeover of Management
Financing / ownership change (part failure)
2016
Chapter 15 Protection in the US
Regulatory, customs or legal action (cross-border insolvency)
2016
Receivership and Stranded Ships
Restructuring or bankruptcy (failure)
2017
Bankruptcy and Asset Sales
Restructuring or bankruptcy (failure) / divestment