The PRC is making major improvements and consolidation to its passenger and cargo roll-on/roll-off (Ro-Ro) industry. In particular, the mergers of major regional Ro-Ro ferry operators under COSCO Shipping and the transregional integration of resources is elevating the business nationally. Major Ro-Ro port infrastructure improvements are also supporting this industry. This not only provides important benefits for regional economic development in northern and southern China, but has other implications for national defense transportation.

During Xi Jinping’s inspection tour of Guangdong Province in 2023, he visited the port of Xuwen where the brand new Xuwen Nanshan (徐闻南山) Ro-Ro port was constructed with a price tag of over 1.7 billion Yuan. This port was a sore upgrade to facilitate the growing volume of transportation demand across the Qiongzhou Strait, the 30-km wide waterway between Guangdong and Hainan Provinces. These developments also included industrial and commercial cooperation to bring together both sides of the strait and better enable the economic development of the Hainan Free Trade Port, a special economic area covering the entire island of Hainan. Similar port upgrades took place on the other side of the strait in Xinhai, Haikou (海口新海), completing work in November 2023 to turn the area into a major ferry hub. The overall improvements to cross-strait transportation infrastructure will expand the role this critical passage will play in the long-term development of Hainan’s economy.

To the east of Xuwen Nanshan Ro-Ro port, one of the older Ro-Ro ferry terminals in Hai’an Port (海安港) has been converted into the Qiongzhou Strait Passenger Ro-Ro Transportation Emergency Support Base (琼州海峡客滚运输应急保障基地). Opening on March 27th, 2025, this base provides repair, emergency support, and rescue services directly for the Ro-Ro ferry industry in close proximity, filling in gaps in ferry support services in the area. The facility includes a drydock and slipway capacity for up to four ferries, with the preexisting berths kept for other servicing.³

The Hainan Strait Shipping Co. Ltd. (海南海峡航运股份有限公司) has consolidated control of vessel operations and shipping resources across the Qiongzhou Strait over the past several years. This business consolidation and concurrent investment has greatly improved infrastructure, efficiency, and profitability. It has expanded the number of routes directly across the strait and to other regional ports, including those in Guangdong and Guangxi Zhuang Autonomous Region. Improved navigational management now enables increased traffic and reduced transit time.

This consolidation of passenger ferry business further deepened when the Hainan Strait Shipping completed its purchase of COSCO Ferry Co. Ltd. (中远海运客运有限公司) in June 2025. COSCO Ferry Co. Ltd. operates 12 Ro-Ro passenger ferries running routes across the Bohai Gulf in northern China. Both under COSCO Shipping, this deal merged two major passenger ferry businesses in north and south China, giving Hainan Strait Shipping control over a total of 66 vessels. This “dual hubs in the north and south“ (南北双枢纽) strategy will allow the two hubs to supplement each other and transfer vessels transregionally to meet seasonal demand during holidays and summer months. According to company leadership, the merger of both companies will establish a dynamic allocation system for north-south shipping and integrates resources, crewing, services, support, and dispatch mechanisms. The company has also launched “Intelligent Shipping Platform“ (智慧航运平台) upgrades to promote interconnectedness across the businesses through digital systems.¹

Analysis

These are good developments for COSCO’s regional ferry operations, which will enjoy more revenue from increased capacity, greater efficiency from improved infrastructure and upgraded practices, and more flexibility in vessel resource allocation during peak volume seasons. Hainan Province in particular is benefitting greatly as it is economically reliant on transit routes across the Qiongzhou Strait for logistics and tourism. Not covered here were the details outlined in national economic planning that drove these developments.

These developments are also highly beneficial for China’s national defense transportation system and logistics support provided to the People’s Liberation Army (PLA). Consolidating resources under the COSCO-owned Hainan Strait Shipping Company will likely streamline ferry management and resource utilization. Both Hainan Strait Shipping Company and COSCO Ferry Co. Ltd. provide their ferries to the PLA for military transportation exercises, including amphibious exercises. The large Ro-Ro passenger ferries of COSCO and Bohai Ferry Group already move to southern China participate in military exercises annually, often to support summer amphibious training operations.² The merger of the two ferry operators could provide better management coordination of these vessels and potentially improve their availability for military use.

For the “An Hang Cup” question, the answer is:

C. Captain, Chief Officer, Chief Engineer, Second Engineer

However, they are excluding a position that is also classified as a management-grade position, the ship political commissar (船舶政委). Interestingly, it is listed among the possible answers, but excluded from C. This could be due to its presence primarily in shipping operations of the major state-owned shipping companies. For more information on this role unique to the PRC Merchant Marine, check out this report published by the China Maritime Studies Institute at the U.S. Naval War College. “China Maritime Report No. 40: Onboard Political Control - The Ship Political Commissar in Chinese Merchant Shipping.“

This newsletter intends to fill gaps in news coverage on Chinese maritime affairs. We hope it will inform professionals in policymaking, international business, defense, academia, and all others interested in crucial components of Chinese economic and maritime power. All feedback is welcome. Please email us at <[email protected]>.

The banner message is a 2018 quote from General Secretary Xi Jinping recited frequently in Chinese official messages on maritime affairs: "An economic power is necessarily a maritime power and a shipping power."

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