Samsung Electronics Co, the world’s biggest smartphone maker, on Tuesday said that about US$38 million of its goods and parts were onboard two vessels operated by the distressed Hanjin Shipping Co, which applied for bankruptcy protection last week.
Supporting Hanjin’s Chapter 15 US Bankruptcy Court petition, Samsung said in a court filing that without an order protecting the shipping line against creditors, the vessels will not be able to dock, causing the South Korean electronics maker losses that might “continue to escalate so long as the cargo aboard these ships remains unloaded.”
Hanjin Shipping won a provisional ruling protecting its assets in the US against creditors, while the shipping line proceeds with its reorganization in South Korea.
Photo: Reuters
The collapse of Hanjin Shipping, South Korea’s biggest container shipping line, has seen as many as 85 Hanjin ships stranded in 50 ports in 26 nations.
Samsung said its visual display business division had US$24.4 million of parts and finished goods in 304 containers meant for its factory in Mexico, while its home-appliance business division had products such as refrigerators, washing machines, dishwashers and microwave ovens worth US$13.5 million in 312 containers.
If the cargo cannot be unloaded immediately, Samsung will be forced to transport alternative parts by air to help meet contractual obligations, entailing “great costs,” it said.
For instance, it would have to charter at least 16 planes at a cost of US$8.8 million to transport 1,469 tonnes of goods, it said.
“All these costs and delays will be a loss not only to Samsung, but also to major retailers in the US and, ultimately, to US consumers,” Samsung said in the filing.
“It is vital to Samsung’s and US retailers’ interests to avoid major disruptions in production,” particularly ahead of the holiday shopping season, it said.
Samsung said it is taking measures to minimize any impact on its business, without elaborating.
US Bankruptcy Court Judge John Sherwood in Newark, New Jersey, on Tuesday issued an interim provisional order on Hanjin’s request and asked for lawyers in the case to file more information before a final hearing tomorrow, according to minutes posted on the court’s Web site.
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