For Cosco Shipping International (Singapore) Co, forging new paths to growth has reaped success. Since 2018, the company has invested significantly, including acquiring logistics company Cogent Holdings, to shift its main business from shipbuilding, ship repairing and marine engineering to integrated logistics.
The company now commands a strong position in the sector, with more than 300,000 sq m of warehousing space, a fleet of over 100 trucks each in Singapore and Malaysia, and a 40% stake in PT Ocean Global Shipping Logistics, an Indonesian shipping logistics company. Cosco is also establishing networks in Vietnam, Thailand and other Southeast Asian markets.
The company’s Logistics Hub Phase 1 on Singapore’s Jurong Island has about 46,450 sq m of warehousing space. It reached full utilisation three months after its 2021 opening, maintaining a 90% inventory level. Jurong Island houses many large chemical enterprises but has limited warehouse space,” notes Gu Jingsong.
“We are the only operator on Jurong Island that offers integrated logistics solutions at one centralised location, from chemical container cleaning and waste treatment to hazardous material storage and transportation”.
Last month, the company announced plans to nearly double the hub’s capacity and equip it with advanced automation, digitalisation and green technologies to boost its operations, efficiency and sustainability.
Gu shares that their ambition is in keeping with its parent company, the China Cosco Shipping Corporation, an industry giant spanning the shipping and maritime sectors. China Cosco was formed from a 2016 merger between two Chinese state-owned shipping companies, China Ocean Shipping (Group) and China Shipping (Group).
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After the merger, China Cosco Shipping Corporation consolidated the two businesses’ shipyards. To align with the strategy of the controlling shareholder and to find a future direction, the company sold the shipyard assets back to the controlling shareholder. It began searching for investment opportunities in Southeast Asia, especially Singapore. “As part of our group’s strategy, we transitioned into a supply chain service provider,” Gu shares.
A promising logistics landscape
Gu adds that the company is building on its growth by capitalising on opportunities emerging from the Covid-19 pandemic. “The crisis’ supply chain bottlenecks and other challenges showed how logistics problems can severely disrupt business, trade, and production. Now, clients are paying far more attention to securing stable logistics services.”
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In this respect, the company’s controlling shareholder, Cosco Shipping Group, has enabled many customers to tide over the pandemic’s difficult years. These include large businesses in the home appliance industry, such as Midea, Haier and Hisense, the automotive sector’s BYD, Geely, Guangzhou Automobile Group and SAIC Motor, and various tyre and solar power companies.
Moving forward, Southeast have many bright spots in the logistics space, Gu says. Many manufacturing industries are quickly shifting from mainland China to Southeast Asia, supported by the Regional Comprehensive Economic Partnership. “Chinese firms are also moving overseas to avoid tariffs and anti-trust issues with the United States and Europe.”
“We are seeing considerable investments from Chinese companies in countries like Vietnam, Thailand, Malaysia and Indonesia, with demand for logistics services rising accordingly.” The company has also been reaching out to these firms and helping them to stabilise their supply chains through its offerings.
Still, more work remains. Gu says: “We must strengthen the coordination among our container fleets and specialised carriers with our sister companies of our parent group.” To achieve this goal, the company has established a joint venture with Cosco Shipping Holdings, Goldlead Supply Chain Development (Southeast Asia), in which it owns a 49% stake, to enhance its logistics facilities.
Gu continues: “We will also invest in strategic logistics nodes along the Belt and Road Initiative. “Our preliminary goal is to continue investing yearly in various warehousing and logistics projects that align with our shipping operations of our parent group to support large clients with modern warehouses, yards, truck fleets and customs clearance services.”
A leader in smart, sustainable logistics
Digitisation and sustainability are other priorities. “More customers are expecting high-quality services that include modern, smart warehouses that are also environmentally friendly. This emphasis on digitisation and sustainability is something that we are working on, and I would say it is one of our strengths.”
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For example, the company also harnesses unmanned vehicles and automated equipment in warehouses. It has developed transportation management, warehouse management, and other systems that are key to providing end-to-end logistics solutions.
“We’re no longer just offering isolated segments such as sea freight or warehousing. Instead, we deliver comprehensive, end-to-end services tailored to our clients’ needs. We have already made leaps and bounds in these areas, rolling out a range of digital supply chain products in markets from Thailand to Vietnam.”
With concerns about climate change surging globally and many firms aiming to curb carbon emissions, the company also takes pride in being a green supplier. Currently, the company is preparing to install solar panels on the buildings at the Jurong Island Logistics Hub. Since the installation is completed in 2025, the solar panel system will generate renewable energy for the company’s own use. Additionally, electric forklifts are already in operation within its warehouses.
“We are pushing for more automation, smart technologies and sustainability, including replacing diesel trucks in our logistics networks with electric ones. Our parent company is also investing in methanol production in China as an alternative, cleaner fuel, and our sister shipyards in China are building methanol-fuelled vessels to meet the carbon reduction goals of our parent company’s fleets while helping our customers achieve theirs.”
“We will continue to expand, especially in markets such as Singapore, and enhance our service offerings for our international clients,” Gu says. “We believe that success comes to those who are prepared. We have been preparing for opportunities and are ready to seize them as and when they arise.”
About Cosco Shipping International (Singapore)
Cosco Shipping International (Singapore) Co aims to become the best-integrated logistics service provider in South and Southeast Asia. The company is also involved in dry bulk shipping, ship repair and marine engineering, as well as property management. The company’s website is https://www.coscoshipping.com.sg/
About kopi-C: The Company Brew
kopi-C is a regular column by SGX Research in collaboration with Beansprout (https://growbeansprout.com), a MAS-licensed investment advisory platform, that features C-level executives of leading companies listed on SGX. ese interviews are profiles of senior management aimed at helping investors better understand the individuals who run these corporations
