In a press release today, the transportation company said it expects to put the first ship into its Hawai'i service fleet in late 2003 and the second in 2004. The ships, to be built by Kvaerner Philadelphia Shipyard Inc., will improve reliability and fuel efficiency, as well as lower operating costs for Matson's fleet, Matson said.

In January, Matson reduced its Hawai'i fleet by one ship to a total of seven to better match lower freight demands resulting from a slumping state economy. A Matson spokesman confirmed that the company still has seven ships but said it is likely the company will add an eighth ship in the near future.

To finance the purchase, Matson will tap its existing capital construction fund of $170 million, supplemented with external borrowings of about $50 million.