Evergreen Marine Corp. is offering a generous 40-month year-end bonus. Can other companies in the industry keep up?

Evergreen Marine Corp. is offering a generous 40-month year-end bonus. Can other companies in the industry keep up? Let's discuss this issue below, hoping that this content can help friends in need.

According to local news media in Taiwan Province, Evergreen Marine Corporation of Taiwan Province recently distributed a 40-month year-end bonus. If calculated based on the standard salary of 60,000 yuan, it would be more than 2 million yuan. Many employees would complain that they had never seen that much money.

It is worth mentioning that in March 2021, the long-term maritime container cruise ship that almost caused the global supply chain crisis caused the global supply chain crisis. However, according to the disclaimer under the Maritime Law, Evergreen, as a transporter, is not responsible for this matter, so it can still pay a large year-end bonus.

Taking Evergreen Shipping as an example, the year-end bonuses of other shipping companies in 2021 have also attracted much attention. In mid-to-late December, the French shipping company CMA CGM announced that it would distribute year-end bonuses equivalent to eight weeks' salary to employees and crew, with a possible payout of approximately 4 million euros. Maersk gives everyone a Christmas bonus of US$1,000.

Mainland China Shipping Company has no information. A crew member from a Chinese shipping company told reporters that he has not received his year-end bonus yet. Since the beginning of this year, the global shipping industry has entered the strongest profit cycle. The increase in transportation fees has made the world's shipping industry bosses make a lot of money. Some shipping companies have made a lot of money in the past ten years.

Take COSCO Shipping as an example. In the first three quarters of 2021, COSCO Shipping's net profit reached its highest level since the company was founded - RMB 69.59 billion, which is almost twice the sum of COSCO Shipping's net profits since 2002.

COSCO Shipping is not alone in its situation. In the first three quarters of 2021, Hapag-Lloyd, the world's fifth largest shipping company, achieved a net profit of US$6.7 billion, exceeding the company's total profit in the previous five years. Maersk achieved a record net profit in the third quarter alone, reaching US$5.5 billion, higher than its best annual profit in history.

Under such circumstances, consulting and management companies continue to improve profit forecast analysis. In October 2021, shipping industry consulting company Drewry forecasted that global container shipping companies expected to achieve US$150 billion in profits before interest and tax (EBIT) in 2021, which is at least five times the historical data.

In fact, Drewry initially predicted that the annual revenue of global shipping companies will reach 35 billion US dollars, which will increase to 80 billion to 100 billion US dollars in July; in October, Drew It rose again to $150 billion, confirming the alarming rise in maritime bond yields.

Not only that, judging from the current situation, the profitability of shipping companies will continue. The United Nations Conference on Trade and Development Trends (Unctad) released a report in November stating that due to factors such as supply exceeding demand, shortages of equipment and shipping containers, and port congestion, sea freight rates are expected to remain at a high level.

Shipping companies are also actively promoting long-term alliances. Based on the current transportation fee, the newly signed long-term agreement is expected to be 2-3 times the transportation fee price of the long-term agreement last year.

However, not all shipping companies will be generous in giving back to their employees after making money, and some employees protested against the requirement for salary increases. This summer, HMM, South Korea’s largest shipping company, went through a 77-day labor arbitration. After 18 hours of negotiations, the monthly salary of the relevant employees will be increased by 7.9%, and the monthly salary will be increased by 650%.

Not long ago, some company shareholders proposed that COSCO Shipping Holdings implement dividend distribution strategies to improve investor relations. In response to this matter, COSCO Marine Holdings emphasized today in response to questions from investors that it is expected to reach the dividend distribution standard before the end of the year, and the actual dividend distribution plan will be announced together with the 2021 annual report after the end of the accounting period. The company has not announced relevant plans for year-end bonuses for employees.