From now on, we would like to start the web conference on Ocean Network Express. Thank you very much for attending this web conference, despite your busy schedules. Today, I will be serving as the moderator. I am Sanae Sonoda. On behalf of the parent companies of Ocean Network Express, I am from Mitsui O.S.K. Lines, General Manager of Corporate Communication Division. I would like to introduce today's presenters. First and foremost, from Ocean Network Express Holdings, Representative Director, Chairman, Mr. Jotaro Tamura.
This is Tamura speaking. Thank you very much for today.
Next, Representative Director, Vice Chairman, Mr. Keiji Kubo.
This is Kubo here. Thank you very much.
Last but not least, Representative Director, Vice Chairman, Mr.[ Takuji Banno].
This is [Banno] speaking. Thank you very much.
Before we start the web conference, I would like to make one housekeeping announcement. Today, both the moderator and presenters will be speaking in Japanese, and there will be simultaneous interpreting into English. At the right bottom of the screen, you can choose your preferred language. There is a button, so please select your preferred language. Please do not unmute the original audio. Please do not tick that box. Without further ado, over to you, Mr. Tamura.
Once again, good afternoon, ladies and gentlemen. I serve as Chairman, Representative Director of Ocean Network Express Holdings. My name is Tamura. Ocean Network Express Holdings, I would like to briefly talk about our organization. It is comprised of three shareholders, MOL, "K" LINE, and NYK, made an investment into ONE Holdings. Currently, I am the Chair of the Board of the organization. Beneath that, as a business corporation, there is Ocean Network, headquartered in Singapore, and CEO is Jeremy Nixon for that company. Ocean Network Express, we will be referring to it as ONE or ONE hereafter. We have come up with a medium-term management plan, ONE 2030. The holdings company and the business company got together to formulate this medium-term management plan, ONE 2030. We are taking this opportunity to explain about the plan today.
For the next 15- 20 minutes, according to the presentation material, I would like to explain the content of our plan. If we could please go to the next page. Here are the contents. This shows what I'm about to present. There are three parts, briefly. First of all, I would like to provide an image of the overall ONE 2030 to provide you with the image. The two others, number two, are just ONE 2030 main business strategy. In our business plan that we have formulated this time, what is going to be the gist or the core of the plan? In July of last year, the business corporation in Singapore made an announcement. What I'm about to explain in number two, it's based on that b ack in July of last year, Jeremy Nixon explained it.
Our basic plan, our basic strategy, based on that, the holding company and the business go together to decide on the investment and finance strategy. That's point three. Inclusive of that, we are having this plan called ONE 2030. I will be covering all these three points. This is the image of the overall ONE 2030. Just briefly, there are three concentric circles. The outer perimeter is in a dotted line. ONE's the business, the container shipping business, our core business, and container shipping value chain affiliated business. These are part of our core business that we have been running. In this plan that we have put together this time, we're going to expand it further to a larger circle. That is one of the main points. As I will explain later, the key phrase for us is sustainable growth.
In order to achieve sustainable growth, based on this plan, we're going to grow our business, grow our company. As we achieve the plan. There are three core elements, which are described on the left-hand side. Operational efficiency, economy of scale, and sustainability. These are the three most important key elements in achieving the objective, I would like to elaborate on each of the elements as we go forward. Next, please. The second part is what I said earlier. In July last year, our business corporation explained the idea, and we're providing a summary of that once again. First of all, ONE's current position and for the future, what is going to be its thinking? That's been summarized. Where it says key highlights, point number two, as highlighted in magenta, sustainable growth.
From this point forward into the future, as an organization, this is going to be the most important key phrase. As is described at the bottom of the page, there are six areas, six items listed. We will realize these, through that, we would like to make long-term contributions to a broader range of stakeholders. Next, please. I talked about our current standing, our current position. The three shareholders' businesses were to be consolidated, that was decided back in 2016. The slide plots our history since then up until 2022. Looking back, between 2016 and 2022, I think we can include 2023, we can call it phase one. That's how we have defined this phase. What was phase one about? It was a period of integration and establishment. From this point onward, what is it that we're aiming for?
That is described in the plan that we have drawn up. It is at the core of our plan going forward. Regarding phase one, I described phase one. We are going to embark on phase two, which is to achieve a sustainable growth. I would like to provide the specifics of phase two more concretely. The title includes the word sustainability. In the diagram I showed earlier, there are three most important key elements. Operational efficiency, economy of scale, and sustainability. All these three must be multiplied with each other. Through that, we would like to realize sustainable growth in phase two. That is the thinking here. Three key components, key elements for the container shipping business and container shipping value chain, there are two businesses that are separately described.
By applying all these three key elements to each, we would like to operate our business in phase two. That is the plan. Realizing sustainable growth through three key elements. More specifically, in terms of strategy, as described from one through five, green strategy, digital strategy, talent strategy, finance strategy, and global strategy. These are the five strategic pillars we will be pursuing. Let me explain these. First on green strategy. One. This is going to be one of the most important objectives that we must achieve in phase two. We have to respond to the needs of the environment. I think it is obvious. Under the banner of green strategy, we would like to pursue ONE's vision, green mission, and green vision. We are going to implement specific initiatives to achieve decarbonization.
We have set targets, as described here, and we are going step by step to achieve this. In terms of environmental compliance, ship recycling and environmental conservation initiatives are also pursued. Next, please.
In the green strategy, especially what we should emphasize would be the decarbonization of our fleet. As of 2030 and at the point of 2050, we are making a comparison. There will be a transition in between, and this page explains that transition. As you can see, at this point in time, in 2030, current fleet, and also we have some orders in place already, and these ships will be our main ships. These will operate with conventional fuel. Going forward, we would like to introduce zero-emission capable vessels, and in 2050, we will use some carbon offset as well. By doing so, we would like to realize our target of net zero emissions, and we would like to push for initiatives to this end. That is our thinking. The next page, please. The second one is digital strategy.
In the shipping industry, especially container shipping business, has some high affinity with digitalization. It is a segment. ONE, ever since its launch, has been making all sorts of efforts and initiatives, and already, to a great extent, all sorts of operations, a great deal of operations have been digitalized to push up efficiency. At the same time, going forward, we'd like to strengthen and advance such initiatives and efforts even more. Through digital solutions, we'd like to realize competitiveness. This is our basic thinking here. The next page, please. The third point is a talent strategy, which is about human resources. ONE currently has about 12,000 employees across the globe. We are leveraging our talents, and unlocking the full maximum potential of our talent will be the source of our competitiveness.
To this end, we have initiatives, and ever since our foundation, we have been taking all sorts of initiatives. As part of our 2030 Plan, taking this opportunity, we would like to revise some of our actions. This page is a summary of such actions. The next page, please. The fourth pillar is finance strategy. As for the details of our finance strategy, in the third part, we will be featuring this point. One key point will be on the left-hand side, you see solid and diversified funding base in the first box, plus financial stability, which is in the second box. These are our key pillars. Container shipping business is highly volatile as a business in nature, and we are engaged in such a business. Solid and diversified funding base is very important.
While realizing such a funding base, going forward in terms of our financing activities as well, we would like to deploy diverse measures and actions. As you can see at the very bottom of this slide, it says a long-term ROE target of 10% or more, and we try to make these compatible. The next page, please. Last but not least, we have our number five, a global strategy pillar. As a global container shipping company, already we enjoy a certain standing. Already we have this, but we try to grow this global strategy even more. Our main pillar, which continues to be our main pillar, our container shipping business, we'd like to pursue even better quality in various ways. Especially, we have a global network in terms of our service, also our service resources.
When sourcing such resources, we should leverage our global standing or network. The next page, please. From here on, I said the third part, and this time around, the holding company and business company put together this investment and finance strategy. I'd like to cover that area from this point on. Next, please. First and foremost, ONE profit plan. From 2024 through 2030, this is positioned as phase two, and we are executing or we've compiled this plan. At the beginning of the plan, for the first two years or so, this is for the entire industry. Because of [OSA], there will be a low profit level for a while. Having said that, what's currently happening, for example, Red Sea situation or other geopolitical factors, we tend to be affected by such developments to a great deal.
At this point in time, it is very difficult for us to come up with prospects. There is not much visibility. Against this backdrop, first and foremost, in FY 2024, this is business as usual, based upon our conventional cycles. From the end of April through the beginning of May, 3J financial results will be published. When they do so, we would like to talk about a specific outlook in terms of numbers for FY 2024. After that initial period, the overall supply and demand situation will improve in the market. We believe our profit level will recover as well. Based upon this thinking or our plan, there will be some benefits from our investment, and 2030 will be the final year of the plan. Our profit level prospect will be $3.8 billion. That is the target profit level at FY 2030.
Next, please. The next one is ONE investment and financing. First, in our plan, in this targeted period, the total amount will be $25 billion in terms of our investment or more. That much investment is planned for our main business, container shipping business. In addition, we will consider a maximum $10 billion towards further expansion of container shipping value chain. This is our investment plan and the most important parts of the plan. Highlights, if you like. As I said earlier, in our management plans, an important point would be sustainable growth. 3J, three shareholders in the shipping business. The segment of container shipping is a sort of a segment where growth is expected. It is a growth segment, as such, sustainable growth is what we uphold. As such, based upon this thinking, we came up with this investment program.
Under this banner, in this plan, we are upholding the direction of our business expansion, which I just explained. As a result, by the end of the final year of this plan, our scale will be 3 million TEU level. That is our expansion target. At the same time, we need to finance ourselves for the investment plan we have. Six to four would be the ratio we will maintain. We will keep in mind, ONE will take some borrowings and also more leverage, equity, and by combining both, we plan to cover our investment activities. Next, please. 3J, three shareholders have an idea about a capital management policy. To compile this plan as ONE, what sort of profit level should be pursued? That was the question. To reach a certain level, what sort of investment would be necessary?
We explored these questions, as three shareholders, 3J, what will be required of ONE? As shareholders, mid to long-term return target would be ROE 10% or more for ONE. In accordance with this, as shareholders, we try to execute the capital management policy for ONE. ONE's equity ratio is exposed to volatility. While considering that, we have to have a solid equity ratio for the company. At the same time, ONE's or ONE's equity ratio has to be normalized or has to be adjusted. From 2024 through 2026, for the span of three years, we plan to make a gradual adjustment. The next page, please. This is the final slide. Shareholders dividend direction. As I said earlier, as shareholders, we have a capital allocation policy. Based upon that, what sort of specific actions are being taken?
On a gradual basis and through phases, we try to normalize or adjust equity ratio, this is basically a return to three shareholders. Every year, dividend or payout ratio should be 30% of the net profit of a given year. In addition, as I said earlier, for those three years, at this point in time, $ 3 billion is the sort of size we keep in mind for a special dividend. In 2024, out of these three years, going forward after necessary resolutions, in June, at least $1 billion of payout is being planned. After that, FY 2025 and 2026, we will look at the progress of the investment plan as well as our financing situation.
We will be monitoring these indicators and, while this is really the overall progress up to 2030, but while monitoring all these points, we try to make decisional judgment. For these three years, special dividend amount is $ 3 billion. That is the number we keep in mind at this point in time. Going forward, depending on the progress, of course, there could be some fluctuation in terms of the special dividend amount. That is quite possible. To compile this ONE 2030 plan, the holding company, meaning 3J, three shareholders, and business company, had to have discussions to compile this plan. That's all for my presentation. Thank you very much. I'm looking forward to your questions from the participants, and I'd like to respond as much as possible as time permits. Thank you.
At this moment, we would like to move on to the Q&A session, questions and answers. Those of you with questions, please use the hand raise button at the bottom of the screen to indicate that you have questions. We will designate you by calling your name. The name that we will be calling will be the one on your screen. If you would like to include your corporation name, please change the name on your screen. Otherwise, we'll be calling your name, and we will unmute you. Once your name is called, on the lower left, there's a mute/unmute button on the screen. Please unmute yourself and start your questions. We would like to take questions at this moment. The first question, Hirokane-san has asked a question. We will send you the approval to unmute yourself.
Hello, can you hear me?
Yes, we can.
I would like to ask three questions in sequence, one by one. My first question, fleet capacity to be set at 3 million TEU. What was the rationale behind that? Why? If you could please explain. Number two, the D/E ratio target is 64%. If you could please explain the background to that as well. Lastly, about shareholder return, $3 billion of special dividends that you'll be returning to the shareholders. The payout ratio of 30% or more, what were the premises or assumptions behind this? If you could please explain that as well.
May I start?
Yes.
Thank you for the questions. There were three questions. Let me answer one by one. First of all, your first question regarding the fleet scale. Well, ONE, currently in East-West route, we belong to the alliance. As a member of the alliance, we provide services. For other ocean routes, we work with various partners individually, to provide services. That's what we do currently. Going forward, by FY 2030, if we are to look at the potential competitive landscape, and of course the situation differs from one route to another, but, the future outlook for all the routes is put together and looked into various assumptions and expectations. It's based on that. Of course, in terms of the routes, we basically intend to continue with our membership and alliance for other routes as ONE.
What we envision as an ideal. Well, we have not been able to achieve our ideal route. In other words, we see more potential for growth that we can tap into. We have growth expectations for ourselves, and given that as well. For each route, how much presence would we like to achieve? We consider that as well. With all those combined, we have come up with this number at the end of this plan period. Your second question, about the D/E ratio with respect to funding. Well, going forward, as we proceed with our investments overall, our balance sheet will change.
On the other hand, I talked about the, b ringing the numbers to appropriate levels, we will be doing that in parallel. As we make those adjustments, what should be the best balance? What is the most realistic balance? We've had a number of discussions on that, at this moment, as we look toward FY 2030, we consider this scale of investment, and as we try to raise funding for that, we've had to be realistic. As we make adjustments, what should be the most appropriate ratio we discuss? As a result of such discussions, we came up with this ratio of 64. 64. That's the answer to the second question. Lastly, about special dividend. It was a question about the size of the special dividend payment, as I understood it. Well, basically, in each fiscal year. If you could bear with me for a moment.
Still net profit for each year, 30% or more of payout. That's the principle. It has not changed from ONE's basic idea from before. In the past, in a year where profits were particularly good, we paid out more than 30%, but in principle, 30% or higher. With that principle in place, as I said earlier, based on the outlook up until FY 2030, as we bring our equity ratio to an appropriate level in the first three years, what should be the size for a basic plan? We concluded that it should be $3 billion. That's our conclusion. As we implement our plan, the profit level of each year, progress in funding, and of course, progress in investment. All these are variables, and of course, we have our own assumptions and outlook for all of them.
There are such variables, and as they become more certain year after year, what should be the timeline under which we should bring the ratio to an appropriate level?
We will be checking on that periodically. It's not a single one-off exercise. I said that in FY 2024, 2025, we will review it and check. Based on the current outlook that we have, in view of the basic thinking, we came up with this $3 billion number. Those are my answers. Thank you.
May I?
Please go ahead.
About my question number three. When profit overachieves the plan. Well, in the first three years, things are going to be tough, you said. Payout ratio of 30% as special dividend payout. Depending on the accumulation of capital, that could change. At this moment, your judgment was to have a special dividend of $3 billion. Is that correct?
Let me answer. Basically, based on the long-term outlook, we're going to bring the equity ratio to an appropriate level. That is the objective. More so than our current outlook, the profits may increase more than the plan, and we may have to review the plan. It could go higher or either lower than the planned number that we have in mind. That is how it's defined. Thank you.
Thank you very much, Masaharu-san from Nomura Securities. We responded to three questions asked by him. Okay. The next question, please. Himeno-san. I'll send you a permit to unmute yourself, so please unmute yourself and ask your question. Please state your name and affiliation before you ask your question once again. Thank you.
Thank you very much. JP Morgan, Himeno is my name. I have two questions. My first question is that in the investment plan from last time, there have been some changes in terms of the monetary amount from container $25 billion and then others $10 billion. In 2022, more than $20 billion was the amount you are talking about. I believe that you increased the amount of investment. Is my understanding correct? What sort of factors went into this change?
My second question would be that maybe this is overlapping with my first question. When you formulated the plan, the alliance reorganization and Red Sea issue have happened, which increased uncertainties. Against this backdrop, in response to these developments, for example, dividend, fleet capacity, investment, and leverage, did you have to review all these KPIs? Regardless of this reorganization of the alliance, were you able to maintain your KPIs? These are my two questions. Thank you.
Thank you very much for your questions. I believe you asked two questions. Let me answer. To respond to your first question about the size of investment. Compared with our previous plan, there's been some increase in terms of investment amount. You're absolutely right. This time around, we reviewed this, and the factors we considered were twofold.
The first one is the tonnage of cargo trends themselves. From our viewpoint, in a way, conservative. Because of the inflation, vessel price. Ship building market has been quite solid. I believe our last outlook was somewhat naive. We reviewed this factor. That is the first point. As for the second point, this is again about the ships. Green investment. We did, in fact, factor this into the thinking. About the trends of alternative fuels. If we bring this forward about the vessel prices for our future orders, perhaps it's better for us to reflect this in our thinking. ONE, this time around, in this plan, on a regular basis, we'll order our mainstay vessels or ships.
From a 3J, currently we lease ships or vessels. The lifespan of such vessels up to 2030 needs to be replaced to a great deal. We will reach such a phase. At such a timing, we try to replace those ships with our own vessels. We factored this into our planning more, and in the end, we ended up with a larger amount of investment. This is in the background. That was my response to your first question. To respond to your second question. The current situation and developments have affected our plan this time around, or have they affected our plan this time around at all? Most recently, as you rightly pointed out, there have been two major developments. The first one is the Red Sea situation. Attacks against the ships have happened.
As a result, some shipping companies didn't want to navigate to that area anymore. Overall, there is more needs or demand for container ships. Currently, freight rates are rising. The rates are on the rise. In 2024, FY 2024, this is surely going to affect our performance in that particular year. Considering the time span up to 2030, in regards to our plan with that time horizons, FY 2020 for profit level is incorporated into this overall plan, of course, but we don't believe it's going to affect our overall situation. Also, you asked about the alliance. In January, Hapag-Lloyd decided to withdraw itself from the alliance. This, the alliance is trying to come up with new services, which will start in February 2025. They are preparing to descend as ONE or ONE based upon our fleet capacity.
The size of a capacity or space we can provide to our customers will remain the same. Because the alliance services will be reorganized, the variation of the services will change. Based upon our planning or from the viewpoint of our planning towards 2030 in the mid to long term, of course, we will be providing services based upon the structure of the alliance. From 2024 through 2025, the impact of reorganization is not zero, but still, overall, we will be able to provide solid and stable services, and we are certain of it. In that sense ONE 2030, when formulating ONE 2030, the current reorganization situation of the alliance didn't affect us or bring about a large impact for us. I don't believe that too much consideration was needed for this point. Thank you very much. These are my responses.
Thank you very much. Very clear. Thank you.
Let us continue. Once you're allowed to unmute, start your questions.
Thank you. Tokai Tokyo Intelligence Lab. My name is Kato. I have one question. In the final year of the plan, $3.8 billion of the profit and ROE 10%. Equity ratio as of 2030 will be $38 billion. Is that assumption correct? About the equity ratio level right now, if there's any comment that you can make, I'd appreciate it. That's my question. Thank you.
First of all, the equity ratio level right now, there's an actual number that's posted on ONE's website, if you could please refer to that. In the final year of the plan, the profit levels for 2030, we have planned the number to be $3.8 billion. What is going to be the size of the balance sheet? We're refraining from announcing specific numbers about that at this moment.
As I said earlier, the fleet scale, well, there are a number of factors that we have to consider about that. One, we are currently leasing vessels. Many of our vessels are from the fleet shareholders. That ratio is quite high. We're going to place orders for new ships, new vessels. The vessels we're ordering are going to be larger in size, more environmental friendly, and we're going to make such investments. Such new vessels, once built, will be posted as assets for ONE. Considering that effect, I think the balance sheet in the future will be larger. Relatively speaking, we believe over the medium to long term, we want to achieve an ROE of 10% or more. That's our target. In fiscal year 2030, a 10% or more of ROE to be achieved. That is the target that we have in mind. That's my answer. Thank you.
Understood. Thank you very much.
Thank you very much. Next question. Please. Once you're ready to unmute yourself, please state your name and company name once again before you ask your question.
Morgan Stanley, Osaka. Thank you very much. Could you hear me? Can you hear me?
Yes, we can hear you.
Thank you very much. I have three questions. My first question would be for the special dividend for FY 2024, at least $1 billion. That's the plan. If FY 2023, this is a disposal of the profit of that year, that's $1 billion, the background. That's my first question. The second one is the capital expenditure, $25 billion for fleet. That is, rather than chartered ships, it is more of your own facility or equipment. How much has been decided for that amount? $ 10 billion additional capital expenditure.
What sort of plans do you have for that portion? Could you talk about the contents of it? That's my second question. The third one, as ONE, you have a target equity. Do you have an equity ratio target, and how much is that? The parent company is saying 50%, as ONE, do you have any number in terms of an equity ratio target, please?
Thank you very much. I'd like to respond to these three questions one by one. The first question was about a special dividend in June 2024, $1 billion is the amount. In FY 2023, there will be profit. Is this a dividend coming from that profit? Actually, it's not the case. In FY 2023, in the first half of the year, there is profit, and then dividend has already been paid out. As for the second half of the year, first and foremost, the payment has to be made. Separately from that, there is an overall capital normalization. We need to make the capital level appropriate. That's my response to your first question.
The second question is about our fleet capacity development. Our own vessels will be included here, but on top of our own ships, also chartered ships from 3J would be also included. Both of them will be on ONE's balance sheet. What will be the combination of these two? That is one issue. Depending on the situation at the time, we try to source ships in an optimum manner. The second question was about $10 billion investment and the contents of this $10 billion. This is for expanding our business, and we need to have an investment of this size. One example would be for our terminal business. ONE, up to this point, has been using the container terminals used by 3J, but also at the same time, Los Angeles, Long Beach important harbor ports, we have been leveraging these as well.
As part of the global strategy, as I mentioned earlier, we'd like to enhance the quality of our offerings. In terms of the terminals, we try to make investment so that we can embed them into our own value chain. This is an important topic for us. We will keep this in mind. Bearing this in mind, we are having discussions and making considerations. Finally, your third question. What was your third question once again? Could you please repeat your third question?
Sure. ONE equity ratio target. What is the target equity ratio for ONE?
Thank you very much for repeating the question. As ONE, container ships, standalone business, we are a specialized player for container shipping, we are exposed to a high level of volatility. Container shipping value chain is the sort of area we are looking into so that we can expand our portfolio. The flip side of that is this kind of investment. To address this volatility, to withstand this kind of volatility, we should have an equity ratio. 3J, three shareholders, are also thinking that this is appropriate. What is the specific target? What is the percentage point? I'd like to refrain from making a comment about that. As three shareholders to ONE, they will be funding themselves going forward. That leverage would be possible so that they can make a profit, so that they can exercise leverage. This is an important point. Thank you very much.
Thank you very much. In regards to your second response, at $25 billion, how much investment has already been decided? Also, as for the $10 billion portion, you will be mainly making investment in terminals? Like other companies, non-shipping or forwarder, those sort of business areas are not what you're interested in.
Is that so? My apologies. Sorry, I didn't cover that part of the question. First, out of $25 billion, what are the actual contents? Going forward, we will be making investment in the future. On top, we call it business expansion. That part, forwarding, air, aviation, some people may think that we are talking about such areas. As ONE, we are not thinking of making inroads into those areas. Thank you.
Thank you very much.
Let us move on to the next question. [Kasiri Chunwata-san], please unmute and state your name and affiliation once again before you ask your questions.
Hi, it's [Kasiri] from Citigroup here. Thank you so much for your time. Just two very quick questions. Number one, shorter term, would you be able to guide the range of Transpacific contracts for this upcoming year? What will be the percentage of coverage that we can expect? That's number one. Number two, on a follow-up question on the change of the alliance with the departure of Hapag-Lloyd. Should we expect both ONE and alliance member to plugging in, let's say, services on Atlantic and North-South, for example? How should we think about it? Thank you very much.
Thank you very much for the questions. Two questions, I would like to answer in Japanese, to be translated by the interpreters. Your first question, Transpacific cargo contract, the trends thereof. I believe that it's a question regarding short-term trends going forward. Transpacific contracts from Asia to North America, eastbound shipping contracts, the core of it is negotiated in May of each year. That is the industry practice. Therefore, in a normal year, in around March and April, contract renewal will take place between the shipping companies and the providers of the ships. Of course, it will have an impact on the profit and loss outlook of each shipping company. Between the consignors and the consignees. This year, as you know, the current spot market conditions are such that they are unstable.
That is because of the Red Sea situation and others that I mentioned. The timing of the conclusion of the contracts seems to be pushed down. It's going to be later than usual. At this moment, we're not in a position to say anything certain at this moment. At least that's going to be my answer. As container shipping companies, if we look at the current situation, the services that we provide, that could be a little unstable, but we have to spend our costs so that we can maintain the level of service, of course. The freight that is commensurate with the quality of the service that we provide, we do strongly hope that that is accepted by our customers.
Secondly, with respect to the alliance and its change, as I may be repeating what I said, Hapag-Lloyd, its official withdrawal will be February 2025. In FY 2024, the current set of services, according to the agreement, will continue to be provided. With the current service menu, the customers need not be worried, and that will be continued up until the official withdrawal. What's going to happen after that is actually being negotiated and discussed among the members as we speak. The scope of the alliance, Asia, North America, Asia, Europe, and transatlantic routes. For each route, there could be differing levels of impact as a result of their withdrawal. We're considering all those factors and the members, in order to provide services next year onward.
We are discussing, at an appropriate timing, more specifics will be announced as I understand it. Those are my answers. Thank you.
Thank you very much. Now it is time to conclude. I don't see any more questions, we'd like to conclude this conference call for Ocean Network Express. After you leave the room, there will be a survey on the screen, please take a moment to respond to that survey. Thank you very much for participating in this meeting despite your busy schedules. Thank you for your continued support. Goodbye.