Wed, Mar 05, 2014 - Page 13 News List

Evergreen forecasts global recovery will bolster subsidiaries

BULLISH:The IMF raising its world growth forecast suggests stronger trade and private consumption, which the group says will aid its airline and shippers

By Amy Su  /  Staff reporter

Evergreen Group (長榮集團) yesterday forecast that its three major subsidiaries would benefit from the quickening pace of the global economy’s recovery this year.

“We remain bullish about the transportation sector’s outlook for the year,” Evergreen Group vice chairman Bronson Hsieh (謝志堅) told a media briefing, citing the IMF’s latest forecast, which put the rate of global economic growth at 3.7 percent this year.

Compared with its previous estimate of 3.1 percent growth, the fund’s more recent forecast of a 3.7 percent expansion indicates a likely pick-up in global trade and private consumption, which would in turn benefit Evergreen’s subsidiaries, Hsieh said.

Strengthening global trade could drive up sales at Evergreen Marine Corp (長榮海運) and Evergreen International Storage & Transport Corp (長榮國際儲運), while a higher rate of private consumption would boost passenger business for EVA Airways Corp (長榮航空), he added.

Total consolidated sales of the group’s two major companies — Evergreen Marine and EVA Airways — are forecast to exceed NT$280 billion (US$9.22 billion) this year, compared with NT$263.36 billion last year, an expected increase that Hsieh attributed to the expansion of capacity at the firms.

Evergreen Marine is to welcome a total of 18 new vessels this year and eliminate nine lower-efficiency ships, while EVA Airways is scheduled to receive three Boeing Co 777-300ER aircraft this year, which could help improve its passenger volume in the second half of the year.

EVA chairman Chang Kuo-wei (張國煒) said the carrier will use the new airplanes on its routes to the US and expects the craft to begin contributing to revenue in the second half.

Despite the fleet expansion, the nation’s second-largest airline has no plans to enter the low-cost carrier sector, Chang said.

Although Rivals China Airlines Ltd (中華航空) and TransAsia Airways Corp (復興航空) are gearing up to launch low-cost flights, EVA plans to stay focused on its long-haul services, Chang said.

EVA is also set to take delivery of more B777-300ER aircraft over the next two years and plans to launch new routes to the US next year, with more flights to Chicago or Houston, he added.

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