In the middle of January, I flew to Shanghai for attendance in the annual meeting of our partner company. It was the short trip of 3 days and 2 nights. Shanghai has evolved more compared with the past. A photograph of the face, an examination for fingerprint were thorough by entry inspection. I was made to do a fresh start many times and was embarrassed whether the precision of the examination for fingerprint machine was low. The traffic jam was the same as before in the expressway and the general road.
But I did not hear the noise of the squawk of car horns. The appearance of people, the manner has improved remarkably, and their looks have been vigor and brightly. Comment of Mr. A, President of major Japanese forwarding company was “China changes in 3 years age”, so I fully agree with him. Chinese policy of “One belt and one road” has steadily begun to work in the Chinese inland including Asia, Central Asia, Europe. It is difficult to precisely keep a Chinese real image only from a media coverage in Japan.
The lunar New Year of this year (Spring Festival) in China is for 7 days from Feb 15 (the last day of the year) to Feb. 21. It is forecasted that the great nation migration of 2,970 million people in China for one month across front and back of this Spring Festival. Its immeasurable energy would produce the domestic spending that will surpass the imagination, which will make Japan and the world realize the Chinese existence again as investment. Real economic growth rate of 2017 in China is 6.9% which exceeded 6.7% of 2016. Economic effect which China could give to the world is not only an export power of China but also the domestic investment from the foreign countries and the import for domestic demand which we could hardly neglect.
As for the purchasing power parity GDP (the US dollar) per nation, Japan is $ 42, 658 and China for $ 16, 624 by the estimation of October, 2017 of IMF. China is still approximately 40% of Japan. However, the fashion of youths in Shanghai is more colorful than Tokyo. Besides, the food culture is of high quality over many divergences so that Tokyo does not follow. The price of Coca-Cola (500 ml) is about 60 yen in China, 100 yen for Japan, mineral water (500 ml) approximately 30 yen but about 100 yen for Japan, BIC Mac about 280 yen but 390 yen in Japan and a tax fare is about 1,400 yen from the down town to the Pudong Airport, where it is approximately 50~60 minutes by car which would be around 15,000 yen by taxi in Tokyo. In Shanghai, there may not be much sensuously difference in substantial salary between the Japanese and Chinese in view of considering the prices difference. Chinese must sensibly feel much richer than Japanese because economic growth is quickly up and their salary goes up every year.
China announced the policy to shift a car to EV (electric vehicle) from gasoline car, light oil car from September, 2017. China made constant amount of EV (electric vehicle) production in duty out of the whole car production from 2019. By means of this, the electric car production in China of major car manufacturers ignited.
China produces 28 million car annually (2016). They cannot ignore the quantity to account for 30% of the number of the world car production. Norway, the Netherlands will prohibit a sale of a gasoline car and a light oil car from 2025, and France, the U.K. will stop sale by 2040. How does the Japanese car manufacturer catch the flows from gasoline car and the light oil car to an electric car? Is the position of Toyota Motor Corporation recording 2,400 billion yen of the net income record high of March, 2018 as far as a rock 10 years later? Nissan Motor invests 1 trillion yen in China by 2022 and they will change all car models to a EV by 2025. Could the auto industry of Japan exist?
The net income of March, 2018 period of the Japanese listed company increase by 27% from the prior quarter of the year to 27,961,500 million yen, which reached a record high for 2 consecutive years. Meanwhile, Sony announced the prospect of the consolidated net profit of 480 billion yen for March, 2018 period. Do they certainly revived with this? Can the Japanese company follow a fast-moving global demand? Or they could predict world demand positively and can they take a step to come through it? The Japanese company only live on their past inheritance and they just survive? Japan has already been one lap behind from world competition? The globalization is just to get us recognize the difference between us and the world. I think that the restoration and revival of the Japanese company is to start from tightly grasping own standing position.
The new container price is $2200 per 20f as of the end of Jan. and there is kept 800,000 TEU of new container stock in the factory in China. The container maker has applied pressure to raise the container price under the present strong container demand (before lunar New Year) and demand after the lunar New Year. The factory space has been fully occupied till the end of March. In addition, the container maker begins to cope by 2 shift systems (day and night shift). It is measures to cope with the strong demand of the new container of this year.
ONE (Ocean Network Express), the integrated company of 3 liner dept. of Japanese 3 shipping lines (NYK, MOL, K Line) has begun collection of cargo activity in Feb. The trade paper does well with ONE related story as well. The containership which ONE operates begins to move from April. ONE does not aim at total three, 1+1+1 = 3. They are expected to attain a half or two-thirds of total three for the cost and 1.5 times or double of average 3 for their productivity. We, EFI has acted as an agency of UES who acquired first L/T lease of ONE, 10,000x40f HC after beating the major leasing companies in Sep, 2017. In addition, UES was able to get 15,000x40f out of 2nd L/T of 50,000 with ONE at the end of January, this year. UES was able to have successively shared 2nd ONE’s L/T from ONE.
On the other hand, ONE will succeed Magnum Plus made by Thermo King a little less than 100 now from K Line. Therefore, we, EFI held Magnum Plus seminar of lecture in the morning and machine operation afternoon participated by dozens of people in Kobe Rokko terminal and Tokyo Ohi terminal respectively in cooperation with ONE early Feb. Other alliance members of Hapag-Lloyd, Yang Ming have already used a large number of Magnum Plus so that it is necessary to get ONE accustomed to handle Magnum Plus without problem.
Magnum Plus user with frozen ability down to minus 40 degrees C in comparison with three other refrigerator makers could gain the deep trust of the shipper than the shipping line which does not use Magnum Plus yet. On the other hand, Magnum Plus is 15 kg lighter than one of other 3 makers. In other words, it could fill more cargo in it. Besides, delicate temperature management, the rapid frozen ability are Magnum Plus characteristics. Strength of Magnum Plus is shown even if to any outside temperature. We are confident that the adoption of Magnum Plus would be a strong supporter to Sales people. The frozen cargo could maintain high quality as it could get colder and colder. The story is not that a chicken comes first or an egg comes first. ONE could expand their business more if they could use Magnum Plus from now on. I am sure that the time comes if they could use Magnum Plus which could cool down to minus 40 degree C because it could make the shipper happy and as a result there will be more reefer cargo increased accordingly.