I Want To Be a Rich Man on Hong Kong Island

May 1959, Dongying, Global Shipping Division.

Wu Guangyao, He Yuanzhang, and Gao Ke are discussing about ordering a new ship again.

In May 1957, after Global Shipping implemented the $400 million plan, the total loan amount was $120 million.

In two years, the net profit of global shipping (more than 2.3 million tons of load) was 260 million, and the monthly net profit was only less than 11 million US dollars;

During the closure of Suez, the monthly profit of global shipping reached 40 million US dollars.

In summary, there are three reasons that lead to this:

First: After the freight rate skyrocketed, it plummeted. In the later period, the price of European and American routes will fluctuate from US$12 to US$15, and the price of East China routes will fluctuate from US$7 to US$9;

Second: shrinking business. In the past two years, Global Shipping's business has been regarded as the most full fleet among all peers, about 80% full. The reason is that Wu Guangyao signed a three-year memorandum of cooperation with long-term customers in Dongying, guaranteeing business priority to global shipping (suez guaranteed the supply of ships to each company during the period, and received a 10% discount on freight). The same is true in Europe and the United States. During the closure of Suez, Global Shipping did not take the lead in raising prices on the ground, and gave a 5% discount.

Third: cost increases. After the Suez Canal was managed by Egypt, tolls soared by 35%, and the wages of seafarers on Hong Kong Island also increased significantly. Various factors led to a substantial increase in costs. Of course, the wages of seafarers in Europe, America, and Japan have also increased accordingly.

In the past two years, the loan repayment was 120 million US dollars, and the container terminals in Sing Tao and London invested about 20 million US dollars, and the balance in the account was exactly 120 million US dollars.

"Boss, the Global Shipping Research Office has recently concluded that the shipping situation in Europe and the United States has taken the lead in improving; as you said, in the 1960s, the industry in Europe and the United States will start to flourish, and now there is a trend. The recovery in Japan is relatively slow. , although the price has recovered to about 8 US dollars, but the business is still only more than 80% of the previous one. It would be good if other fleets in Asia can have 70% of the business, and the long-term charter fleet does not need to worry about this problem, it is more popular.” He Yuanzhang Open your mouth and say.

Wu Guangyao nodded, this is expected; after a sharp rise, a sharp fall, and then a rise again, this is the law of shipping.

The Global Shipping Research Office mentioned by He Yuanzhang was proposed by Wu Guangyao; he hired a team of experienced global shipping professionals, who usually work around the world, collect data, and then make a summary.

Although Wu Guangyao understands the general situation, the details also need to be done by people.

"What do you think,

How about we sell some of Japan's old ships (about 30 years old)? " Wu Guangyao said.

When He Yuanzhang and Gao Ke heard this, they immediately said in unison: "No!"

Then He Yuanzhang signaled Gao Ke to say first, as the person in charge of Dongying, Gao Ke naturally has a great say!

"Boss, these ships can be used for three to five years if they go well, and can be used as retail leases or refitted container ships; if they are sold, we are equivalent to capitalizing on the enemy. The key is that these ships are not worth much, they can only use them Even if these ships are recycled scrap iron, they cannot flow into other ship owners on Hong Kong Island.”

He Yuanzhang continued: "Yes, boss. And I guess, you want to sell it to your fellow countryman Bao Yugang! But boss, don't forget that Bao Yugang's ship business has not stopped in the past two years. It has developed into a ship owner with a deadweight of 100,000 tons. And I found that he is very popular with employers in Dongying, I think it is probably because he likes the long-term contract of one year charter!"

After Wu Guangyao heard what the two said, he woke up suddenly!

I'm too naive, Bao Yugang is my 'enemy', yet I still think about my fellow countrymen, the most important thing is not to have this kind of 'behavior of being an enemy'.

Wu Guangyao said modestly: "You two reminded me well! Indeed, Bao Yugang's status as a banker makes him a duck to water in the shipping industry. I heard that he has also obtained the LC letter of credit from Dongying Bank. It seems that he may Come from behind!"

"I can't see it for the time being, but he is indeed a stable businessman who knows how to use banks." He Yuanzhang said pertinently.

Wu Guangyao thought for a while, and then said: "In this case, you all remember one thing, that is, when Bao Yu first entered the field of oil transportation in Europe and the United States, our global shipping business in Europe and the United States also had to change the business policy appropriately. For For our loyal big customers and old customers, we can adopt a combination of long-term lease contracts and short-term lease contracts to gain their favor! Similarly, the three-year cooperation memorandum of Dongying old customers is about to expire, and we can also sign part of the long-term The contract can be regarded as stabilizing theirs!"

Wu Guangyao also decided that it is better to be a little more conservative in the follow-up management policy;

Judging from the experience of later generations, a large part of the reason why Bao Yugang came from behind is that he likes to rent long-term contracts of one to three years.

In the eyes of the bank, this way of operation obviously does not have too much risk, so the bank will choose to lend.

Coupled with his way of doing business, he has gained a good impression in Dongying. The government, banks, customers, and shipyards all like him and give him various conveniences.

In the late 1960s, Dongying Shipyard was full of orders and could only suspend receiving business; but everyone would sell Bao Yugang's face and accept Bao Yugang's orders. This is an advantage.

There is another very important reason why Wu Guangyao changed his business strategy!

That is, the development of global shipping is too fast. Although there is no debt, the foundation (customers) also needs to be stabilized.

Wu Guangyao thought for a while, and said to the two executives: "Our global shipping will have another graded shipping price, and the shipping price will be set according to the age of the ship. For example, the shipping fee for a 30-year-old ship is only 70%; for a 20-year-old ship , the shipping fee is only 80%; so those customers who are against old ships may think that old ships are cost-effective, after all, our global shipping is all three guarantees (guarantee time, security, insurance).”

"Good idea!" The two said immediately.

Both of them believe that no one wants to make quick money, but it is impossible to make it all the time;

Especially to appease those old customers, those who do shipping know that the business is the most important, and the shipping cost is second.

"For the specific implementation plan, you convene the management to study it in detail, and I will not participate!"

"Yes, boss!"

Next, everyone will discuss how many 100,000-ton oil tankers and how many 70,000-ton cargo ships will be built this time.

The Second Middle East War (Suez Canal Crisis) dealt a huge blow to the world shipping industry. Although the canal has resumed operations, oil companies have lost confidence in its reliability. There has been a heated debate among European and American oil companies over the safety of the Suez Canal and the expansion of oil pipelines. Obviously, whether it is a canal or a pipeline, it is easy to be cut off. Then there is another alternative, which is to use tankers with larger loading capacity to bypass the Cape of Good Hope route in Africa. However, ship owners generally believe that the cost of large ships is high, the fuel cost is too high, and it is not easy to build.

Japanese shipbuilding companies smelled business opportunities from this, and they quickly broke this conclusion with practical actions. In February 1959, Japan's Kure Shipyard built the world's first oil tanker exceeding 100,000 tons—the universe Apollo. The ship has a total length of 290 meters, a total power of 27,500 shaft horsepower, a load of 104,500 tons, and a speed of 15.5 knots.

Facts have proved that oil tankers of more than 100,000 tons not only meet safety standards, but also have cost advantages.

Usually, about 16,000 tons of steel are needed to build a 100,000-ton tanker, and 24,000 tons of steel are needed to build two 50,000-ton tankers.

Moreover, the larger the tanker, the more crude oil can be transported in a single voyage, and the average fuel consumption per ton of transport volume will be lower.

Wu Guangyao has read "The Biography of Bao Yugang", and he clearly remembers the 100,000-ton oil tanker and the 200,000-ton oil tanker, and behind them are the main oil tankers of global shipping.

That's why Wu Guangyao was sure that choosing a 100,000-ton oil tanker was absolutely right!

In the end, everyone decided to build 12 100,000-ton oil tankers and five 70,000-ton freighters.

In this way, the load capacity of new ships for global shipping has reached about 5.1 million tons, which is the level of Onassis in the late 1960s.

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