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Partnerships & technology strengthen shipshape logistics network

Interview - September 28, 2016

Using state-of-the-art roll-on roll-off (RORO) ships, RKK Line capitalizes on its location on Okinawa prefecture to specialize in providing maritime transportation and logistics services that connect Japan’s mainland not only with nearby Taiwan, but also further afield through its network of international partners. Chairman Hiromi Yamashiro discusses the company’s expanding fleet, attention to environmental efficiency and technology, and strategic alliances that create a bridge between Japan, Asia and the rest of the world.

 

HIROMI YAMASHIRO, CHAIRMAN OF RKK LINE
HIROMI YAMASHIRO | CHAIRMAN OF RKK LINE

Could you begin by giving us an overview of RKK Line and the main services you offer?

RKK Line is a company located in the southern part of Japan, the Okinawa prefecture, an archipelago close to Southeast Asian countries. At RKK we have a network of 14 companies that offer services in maritime transport, logistics, freight forwarding and others, offering a high quality standard of logistics with a premium service, speed and safety.

We provide the strongest logistics network in Okinawa thanks to our six RORO (roll-on roll-off) ships. A RORO ship can keep the cargo horizontally during operations by using trailers, drastically reducing the chance for cargo to be damaged. Plus, they are loaded much quicker than full-scale container ships, enabling us to reduce the lead-time. RORO ships can transport not only the containers that are used mainly in international shipping but also long components. Our 12m long trailers help them be transported without being unloaded.

In summary, thanks to our RORO ships we have a higher ability and reliability to collect cargos. Additionally, we managed to reduce cost and time by offering a service called Seamless transportation, which has just launched for the first time in Japan on our Taiwan route.

 

Since the launch of Abenomics, the Japanese economy has seen a considerable reboot. However, the logistics sector is highly dependent on what is happening in the global arena too. How has global uncertainty impacted the logistics sector?

First of all, it is clear that world economics will become more uncertain and unpredictable. The cooling of the Chinese economic growth, global terrorism threat posed by ISIS, economic instability caused by Brexit, and political uncertainty surrounding the next president of the United States. Uncertainty in the international arena is causing yen appreciation and falls in stock prices. In this context, we believe we serve as a source of stability even if our sector is subject to shocks. At RKK Line we are working to develop logistics in Asia with a strategy to overcome the situation.

 

Could you elaborate on which strategy RKK Line is following to overcome the aforementioned situation?

RKK Line will deepen services on our existing routes. Internationally, we will continue linking Naha to Kaohsiung in Taiwan, and from there to Southeastern Asia and to the world. We will also explore the possibility of establishing alliances with shipping companies that have routes to Shanghai and Busan.

Domestically, our priorities are the routes of Tokyo-Osaka, which connects two megalopolises, and Hakata-Kagoshima, which connects the northern and southern parts of Kyushu district.

Innovation is critical in overcoming existing instability. We are adopting more electrically controlled engines to save energy when building ships, and we are collecting weather information with newer technology and enlarging the thrusters to improve our ships’ maneuvering performance. RKK Line is benefiting from technical advances and support from partners, including NYK and MTI. We aim to cultivate human resources capable of doing business with global point of view.

 

In this competitive and uncertain business environment, what is your group’s greatest competitive advantage? What are the challenges to operating from Okinawa?

First of all, we enjoy some support from the Okinawa prefecture and from the Japanese government, as we are contributing to the economic development of a peripheral prefecture. RKK Line's growth is good for the development of Okinawa prefecture and vice versa. We are currently offering the best ships and shipping network available in the prefecture. We are benefiting from the strong economic growth of the prefecture together with the increase in population and an increase in the number of tourists. The lower price of fuel is of course helping us too.

However, there are some challenges related to our location. The first one is the need to strengthen the facilities of the archipelago that are not as good as in mainland Japan. Secondly, we are experiencing a shortage of skilled workers; consequently there is an urgent need to boost the professional development of younger generations.

 

Could you give us an insight on your latest projects? What is your growth strategy for the years to come?

We are excited to announce that our seventh RORO ship will go into service next fall. Despite the fact that we are mostly focused on the route between Naha and the mainland, we will keep our internationalization plan following the example of our newly opened route between Naha and Taiwan.

Our medium-term business plan includes the enlargement of the size of the ships and the application of energy-saving systems to our main six RORO ships as we take the reduction of CO2 emissions very seriously. RKK also plans to build more facilities to support our ground transportation and deepen the quality of the service we offer, especially in Uruma and Ishigaki (cities located in Okinawa prefecture) and in Fukuoka (mainland Japan). In this regard, we should speed up to resolve a shortage of drivers for ground transportation.

We are also aiming to automate our warehouse, which can store at different temperatures. This will allow us to offer a 24-hour warehouse operation. The establishment of a bond warehouse for international shipping service is also envisaged. We will consider doubling our routes to Taiwan by building one more ship.

We also plan to expand our domestic network and enhance the relationship with our partner companies (MOL, NYK, KLine, Yamato Logistics, Okinawa Product and KYK). For instance, thanks to our partnership with MOL, we have taken advantage of their existing network to handle imports from the US and Europe. The expansion of the existing routes between Tokyo and Osaka, and between Hakata and Kagoshima will be a priority. As you can see, we will continue diversifying our risks by combining the use of our ships both domestically and internationally.

 

You consider yourselves as a bridge between Okinawa and the rest of the world. What is the relationship between RKK Line and Okinawa prefecture?

RKK Line has made several contributions to Okinawa prefecture, but also to Japan as a country, thanks to our CSR policies in place. For instance, we transport “made in Okinawa” and other local products, such as different sugars, tobacco leaves, mangoes, seaweed and pottery at reduced rates and priority spaces. Secondly, when any natural disaster occurs in the archipelago, like typhoons or earthquakes, we help the disaster-affected areas by delivering emergency items and other needed goods.

We also support cultural and sports events by transporting the necessary equipment with a friendly price rate. We apply environmentally conscious materials to the marine equipment, conducting a 15% energy saving every time we build a new ship, using chassis and trailers to perform operations reducing the amount of energy used. Finally, we participate in many social activities as a company, encouraging our employees to devote part of their time to community service.

 

As a final message, what would you like to share?

After several years of a slow and sluggish economy in Japan, I believe that our country needs to get more involved with other growing Asian countries and recover its vitality. At RKK, we are located on a small island far away from mainland in Japan but with a geographical advantage: we are closer to Southeast Asia.

RKK is eager to become a front-line company in our common goal as a country to revitalize the economy. 400 years ago, Okinawa prefecture was a kingdom, called Ryukyu, which was successful and prosperous as a logistics hub in Asia. Learning from the virtue of wisdom and courage from our ancestors, RKK would like to remain as a bridge between Japan, Asia and the rest of the world. 

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