CMA CGM, France’s distinctive global line

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   Not for nothing is Marseilles-based CMA CGM known as “The French Line”. This privately-controlled liner shipping operator, with a worldwide network of routes based on historical French trades, runs third in size behind Maersk Line of Denmark and Mediterranean Shipping Co. of Switzerland. The two top lines are almost twice the size of CMA CGM measured in containership capacity, but CMA CGM is much closer to them in terms of the number of container ships it operates (392 compared with 658 and 479 respectively). By either measure CMA is well over twice the size of any line further down the pack.
   In the last 15 years or so, while Maersk and the top German Lines were focused on acquiring all their many British, U.S, Canadian, South African and Dutch deepsea competitors, (also all except CCNI and CSAV in South America) CMA CGM was growing through the almost exclusive aggregation of French liner companies. It’s most significant component outside this sphere is the former state-owned Australian National Line (renamed ANL and registered in Singapore). In 2007 it also acquired the small Taiwan-based Cheng Lie Navigation, now branded CNC Line, as its provider of an intra-Asian network operating mainly in the range between Thailand/Vietnam and North China/Japan.
   ANL gave CMA CGM a significant boost to its conference rights in the Oceania trades dating back to 1998, but until 2006 when Delmas Vieljeux was acquired (now called simply ‘Delmas’), it had no access to French trade with West Africa, nor Delmas’ Indian Ocean trades, both significant elements of the French colonial empire prior to the 1960s. CMA CGM obviously has a distinct advantage throughout the French-speaking world, which grew to be second in size only to the English-speaking British colonial empire. Former colonies include Algeria, Morocco, Tunisia, Syria, Lebanon and Vietnam, with current possessions retained as external French territories in South America (French Guyana), the Caribbean Islands, and Islands in the South Pacific and Indian Oceans. In addition there are French-speaking settlers in various other countries such as Canada.
   The CMA CGM group officially emerged through a 1999 merger of the Saade family-controlled Compagnie Maritime d’Affretement (CMA, a relative newcomer) and the former large state-owned French shipping giant Compagnie Generale Maritime (CGM). It was the 1999 merger (effectively a reverse takeover) which promoted CMA CGM to the status of a top player in the world container league. ‘CGM’ had brought with it long-held French rights from France and the North Continent to Asia, in the transatlantic, and in other ‘French interest’ participations such as from Europe to South America, Africa, the Caribbean and Australia.

Partnership with China Shipping This French trade heritage, together with its new-found size, enabled CMA CGM to adopt a very much more independent strategy in the main east-west trades compared with other lines (except Maersk, Evergreen, and later MSC), who were herding together into alliances. It meant that when the Chinese government began flexing its shipping muscles and COSCO Container Line was persuaded to join the CKYH Alliance, CMA CGM was available to give a close guiding hand to the fledgling China Shipping Container Line; a role which is still evident in their relationship today.
   From an analysis of ComPair Data, CMA CGM and China Shipping share ships or exchange slots on 10 important loops originating in China; four to north Europe, two to ECSA, two to WCSA, one round-world loop to the Caribbean, and one all-water loop to the U.S. East Coast. All the westabout shared loops from China call at Port Kelang, and it is evident that this has become the main Southeast Asia hub for China Shipping as well as CMA CGM. Of the other major lines, Evergreen Line shares Maersk’s massive mega-regional hub in Tanjung Pelepas, while all of them, of course, call Singapore.
   Interestingly CMA CGM still has an avuncular role with one last remaining smaller French line, Marfret Compagnie Maritime, also of Marseilles and owned by the Vidil family. Marfret almost entirely exists through slot charters with CMA CGM.

Partnerships involving both Maersk and MSC Until comparatively recently the top three global lines have been relatively circumspect in their partnerships with one another. CMA CGM and Maersk began calling themselves ‘northern hemisphere’ partners as they started to exchange slots and the occasional vessel in loops between Asia and Europe (in addition to various pre-existing liasons in the transatlantic). None of these Asia-Europe loops included ones where CMA was already partnering China Shipping. CMA CGM had always had an above-average number of slot-charters on other lines’ loops in this trade to gain an above-average port coverage and frequency of services to offer its customers, especially those trading via Le Havre into northern France.
   With hindsight the very temporary Maersk/CMA CGM Asia-Europe partnership maneuvers probably had more to do with the imminent arrival of much larger ships and longer term plans. Maersk was to develop its pure ‘own-brand’ from Asia to north Europe, while still sharing loops with CMA CGM from Asia to the Mediterranean and Black Sea. This approach by Maersk would then leave the way clear (and the justification) for CMA CGM and MSC to form a ‘rival’ four-loop partnership to north Europe. It involves an exchange of slots on each of their two big-ship loops; CMA CGM’s FAL 1 and FAL 3 (total 22 ships averaging 11,480 TEUs) and MSC’s Lion and Silk (22 ships averaging 12,938 TEUs). MSC’s Lion loop now calls Port Kelang eastbound and has added it as ‘last port out’ westbound call for its Silk loop before a fast 18-day transit non-stop to Felixstowe.
   There are still comparatively few loops which all three top carriers share together apart from three high-profile VSA loops in the Asia-California trade, ostensibly permitted by the FMC to allow the use of larger vessels without over-tonnnaging the market. Only one of these loops now has exceptionally large ships (the Pearl River, average 10,699 TEUs, three ships each from MSC and CMA CGM). The other two VSA loops, on which CMA CGM only takes slots, are provided one each by MSC (8,186 TEUs) and Maersk (4,139 TEUs).
   Other loops in which all three top lines participate are harder to find, such as MSC’s ECSA loops to north Europe and the Med, on which both Maersk and CMA CGM take slots; also the double-headed ‘Boomerang’ loop between Australia and Asia operated jointly by Maersk and MSC, on which CMA CGM is represented by its subsidiary ANL, chartering slots. (In virtually every other former ANL or Delmas trade, CMA CGM now also markets additionally under its own brand name, just as the Delmas and ANL brands have spread onto many former CMA-only services. There is a fourth deepsea marketing brand owned by CMA, derived from the former U.S. Lines, which offers space on all CMA CGM’s transpacific services. By contrast none of the four main liner brands market space on services within CNC’s intra-Asian network.)

Closer separate two-way ties with Maersk and MSC If three-way partnerships between Maersk, MSC and CMA CGM are still relatively few and far between, separate two-way partnerships, particularly between Maersk and CMA CGM, and now increasingly between MSC and CMA CGM, can no longer be ignored.
   The highest-profile joint Maersk/CMA CGM loop is the innovative Columbus pendulum which uses 16 ships (eight ships each) averaging 8,312 TEUs to join the U.S. East Coast with Asia via Suez, before continuing on as a transpacific connection to the Pacific Northwest. In Southeast Asia it misses out CMA CGM’s hub at Port Kelang and only calls at Maersk’s mega-regional hub of Tanjung Pelepas, (providing two core ‘spokes’ in Maersk’s now global hub and spoke network). This partnership and routing avoids the Panama Canal altogether, allowing the use of larger ships with low slot costs, while also limiting each line’s exposure on each leg to half these ship’s capacity.
   Altogether CMA CGM now shares 21 loops with Maersk. On nine of these they share vessel provision, on seven loops one or the other provides ships, with the other taking slots, and on the remaining five both take slots. (Three of the latter are loops entirely provided by MSC.) Interestingly, where both Maersk and CMA CGM jointly provide ships, CMA CGM always provides the same number as Maersk or fewer, giving it the appearance of being the junior partner.
   Maersk and CMA CGM exchange slots on their two separate Asia-West Med loops, both of which call in Malta, and they jointly provide two more loops from Asia to the Black Sea and Adriatic respectively. All four of these loops call at both Port Kelang and Tanjung Pelepas, but a fifth joint loop from Asia, to Port Said and Turkey (on which CMA CGM provides two out of eight ships), calls only Tanjung Pelepas. Eastbound it runs non-stop to Xiamen. The pair also jointly operate a service between Asia and West India, with CMA CGM providing two out of seven 6,237-TEU ships. This loop calls Tanjung Pelepas outbound from Asia and Port Kelang inbound.
   In the smaller transatlantic trade and trades with the Caribbean and Oceania, there is more scope for Maersk and CMA CGM to run in parallel, arising from their inherited interests. Their joint Amerigo Express (CMA CGM 2 ships, Maersk 4) connects the West Med with the U.S.East Coast, calling at Malta and two other joint hubs in Algeciras and Tangiers. CMA CGM takes slots on Maersk’s north Europe-U.S south Atlantic and Gulf loop, also another north Europe loop to Montreal. They both take slots to the U.S.East Coast from north Europe on two loops provided by the New World Alliance. CMA has another transatlantic loop, operated jointly with CSAV, and on which Maersk is not a partner, a circumstance consistent with Maersk’s avoidance of all such loops where CSAV has become involved.
   In the Caribbean, Maersk and CMA CGM run a joint feeder loop (three ships each) connecting South Brazil with Maersk’s major hub at Manzanillo (Panama) and also with smaller hubs used by CMA CGM at Cartagena, Kingston and Port of Spain. CMA CGM also gives Maersk slots on its direct north Europe service to the French West Indies. Here Maersk is the junior partner, a situation repeated on the Oceania service to WCNA, where again French interests are involved. CMA CGM (through ANL) provides four out of seven ships in a joint service with Hamburg Sud and Hapag-Lloyd . Alternate vessels call northbound at French islands in Tahiti and Fiji.
   The most interesting recent twist involving Maersk and CMA CGM came when CMA CGM appeared to switch sides from partnering MSC between Asia and South Africa to joining Maersk as a slot charterer on its dedicated Safari loop, now with larger ships averaging 7,500 TEUs.

CSAV, MSC and South America In the past year both CMA CGM and MSC have entered into supportive arrangements with Chile’s CSAV by merging CSAV’s services with their own. Sometimes CSAV still provides some of the ships and sometimes it has replaced them entirely with slot charters instead. To begin with there was a clear-cut division between CMA CGM and MSC over the trades in which they had already formed, or were proposing to form, agreements with CSAV, but since then they have announced an overlaying partnership of their own, involving the Asia-Europe trade and all their trades to South America.
   The result is that not only have CMA CGM and MSC become partners on South American trades where previously they were either not participating or had competing services, but the addition of CSAV as a marketing brand with a significant market share is forming a threesome with the strength to operate larger average-size ships. As previously indicated Maersk line has kept apart from the CSAV absorbtion, so CMA CGM now finds itself deeply involved in accumulated partnerships with CSAV and lately MSC as well.
   Most recently CMA CGM has joined the MSC/CSAV joint U.S.East Coast-ECSA loop as a slot charterer, entering that trade for the first time, and MSC has entered the Asia-ECSA trade by taking slots on the joint CSAV/CMA CGM/CSCL ‘SEAS’ loop. Interestingly MSC did not take slots on the parallel SEAS2 loop which, in addition to CMA CGM, CSAV and CSCL, has Maersk and Hamburg Sud as vessel providing partners. Taken overall, CMA CGM partners CSAV on 15 loops and partners MSC on 14, but seven of these loops are shared in common.

French trades and CMA’s numerous smaller hubs After examining the trades in which CMA CGM partners with Maersk and MSC, it is instructive to look at areas where it still mainly does not do so, like Europe and Asia to West and East Africa. Maersk and CMA (Delmas) have extensive rival networks in these areas. Also in the intra-Asian trades their respective specialist subsidiaries MCC and CNC do not cooperate at all. CNC’s partners are fellow Taiwanese operators like Evergreen, Yang Ming and TS Lines. Apart from taking slots on one Wan Hai loop, CNC does not reach down as far as Port Kelang and only one slot charter (with Yang Ming) goes as far as Indonesia.
   Nevertheless CMA CGM’s biggest hub by far is Port Kelang at which over 25 loops stop in one or both directions en route to and from Europe, Africa, Asia, the Middle East, Americas, Caribbean, and Oceania.
   In the Middle East, CMA CGM makes no calls at all in Salalah where Maersk and MSC transship extensively. All its own main loops (6) call at Khor Fakkan inside the Strait of Hormuz, as well as in Dubai. It transships from there to India, East Africa, West Africa, Europe and Asia.
   In the Mediterranean CMA CGM makes full use of Malta as a north African hub, connecting there with its north Europe loops to India and Australia as well as connections provided by partnerships with Maersk and MSC. (FAL 1, MEX, AE11 and WestMed all call there.)

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   When it comes to feeder connections with West Africa, both CMA CGM and Maersk use Tangiers for inbound services and Algeciras outbound. CMA CGM has seven independent West African loops which call both hubs. These interconnect at these ports with other services or each other.
   It is in the Caribbean, Pacific and Indian Oceans that CMA displays its most independent French-influenced capability. Its main Caribbean hub is at Kingston, Jamaica, which connects CMA CGM’s own distinctive services to all parts of the world: its ‘Cagema’ loop links the_U.S.East Coast to Rio Haina and the French West Indies; ‘ECS’ links north Europe with Cartagena and Central America; ‘GCE’, (jointly with CSAV), links the U.S.Gulf and Mexico with Cartagena and Venezuela; ‘PEX 2’, (a round-world loop jointly with CSAV and China Shipping), connects Port Kelang and Asia with West Mexico, Cartagena, and smaller hubs in the Caribbean at Caucedo, Puerto Cabello and Port of Spain, before setting off for Port Kelang again; ‘RTW PAN’, a fortnightly loop from north Europe and the U.S.East Coast, (jointly with Marfret) connects via Panama to the French Pacific islands and Oceania; the ‘BRAZEX’ feeder with Maersk links to South Brazil; and the ‘Eurosal 2’ loop, (jointly with Hapag-Lloyd and Hamburg Sud), links north Europe-with Cartagena and WCSA.
   It is not just in Kingston that CMA CGM’s loops so independently meet up. Eight loops, several of them the same as in Kingston, intersect at Manzanillo (Panama), seven at Cartagena, and so on. CMA CMA recently managed to launch an Asia-New Zealand loop, (jointly with one ship from OOCL), by factoring in a call at Suva southbound and New Caledonia northbound, exploiting French interests in both cases. It intersects in mid-Pacific with its fortnightly north Europe-Kingston-Oceania ‘RTW PAN’ loop as well.
   Doubtless similar French interest opportunities are being exploited by CMA CGM in the French Indian Ocean islands of Reunion and in Madagascar/Seychelles, via a hub in Mauritius (shared with Maersk and MSC).
   Clearly, CMA CGM has a strong and increasingly useful role as a member of the top three lines’ global club, but it has also retained its own very proud and independent French identity at the same time.

Researcher: Francis Phillips

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