Matson continues to invest in its Honolulu terminal

Matson Navigation Company, Inc., which has never taken its role as trade lane market leader for granted, has signed contracts with Paceco Corporation for the purchase of three new 65 long-ton capacity cranes and modifications to upgrade three existing cranes at its Sand Island Terminal in Honolulu Harbor. 

The news comes at at time when other players are concentrating on capturing some share of the business. As reported in LM, TOTE recently announced its intention to establish a new domestic shipping service to Hawai’i. The company is working with Philly Shipyard to construct four new environmentally advanced containerships, custom built for the trade.

The investments are part of a broader $60 million terminal expansion and modernization program Matson is undertaking to prepare its operational hub in Hawaii for the arrival of four new ships the company has on order with a combined value of approximately $930 million and deliveries starting next year.

The new cranes will be built by Mitsui Engineering & Shipbuilding (MES), delivered next year and installed at Matson's Sand Island Terminal in Honolulu in early 2019.  They will have greater lifting capacity, height and reach than Matson's existing cranes, enabling full service of the company's new larger Hawaii vessels going into service over the next three years.  They are also more energy efficient, easier to maintain and will be equipped with fiber-optic cabling, enabling faster and more accurate communication of data used in Matson's container tracking system.

Matson will use the new cranes to replace three older and smaller cranes, while upgrading three other existing 40 long-ton cranes to the same electrical system and fiber-optic cabling as the new cranes.  

Matson's investments in these terminal improvements are a cornerstone of the State of Hawaii's Harbor Modernization Plan, which includes the reinforcement of berths in Honolulu Harbor to support the expansion of Matson's Sand Island Terminal.

"Having just marked our 135th year in Hawaii, these latest investments in our fleet and terminal infrastructure underscore Matson's long-standing commitment to serving our island communities with the most reliable, efficient and environmentally friendly operations in Hawaii for the long-term," said Matt Cox, chairman and chief executive officer.  "Our new Aloha Class and Kanaloa Class ships are being built specifically to meet Hawaii's freight needs into the future while reducing our environmental impact and improving our efficiency for decades to come."

Matson has two Aloha Class ships under construction at Philly Shipyard in Philadelphia with deliveries scheduled for the third quarter of 2018 and first quarter of 2019, respectively.  The 850-foot long, 3,600 TEU (Twenty-foot Equivalent Units) vessels will be Matson's largest ships and the largest containerships ever built in the U.S. 

They will also be faster than any of Matson's current vessels, designed to operate at speeds in excess of 23 knots, helping ensure timely delivery of goods in Hawaii. 

Matson has also ordered two Kanaloa Class vessels from General Dynamics NASSCO in San Diego with deliveries scheduled for the end of 2019 and mid-year 2020.  These ships will be combination container and roll-on/roll-off ("Con-Ro") vessels built on a 3,500 TEU vessel platform 870 feet long and 115 feet wide, with enclosed garage space for up to 800 vehicles.  

In addition, all four new vessels will have state-of-the-art green technology features, including a fuel efficient hull design, environmentally safe double hull fuel tanks, fresh water ballast systems and dual-fuel engines, meaning that they will be able to operate on either conventional fuel oils or liquefied natural gas ("LNG") with some adaptation for LNG.  These advancements are important to Hawaii as a means to reduce fuel consumption, and will result in significant emissions reductions over time.  

The larger capacity of the Aloha Class and Kanaloa Class vessels will allow Matson to return to an optimal nine-ship fleet deployment in Hawaii, increasing efficiency and lowering operating costs, a key objective of the company's infrastructure investments.  

With delivery of the Kanaloa Class ships, along with its two new Aloha Class ships, Matson will have completed the renewal of its Hawaii fleet, allowing it to retire seven older vessels that will no longer comply with environmental regulations in 2020 without substantial modification.