Tuesday, March 26, 2019

Shipping: CMA CGM To Spend €1.2 Billion on New Container Ships

Things appear to be good for the Saadé family.
From the Wall Street Journal:

France’s CMA CGM to Buy Chinese-Made Container Ships 
Order from government-run China State Shipbuilding announced during Chinese President Xi Jinping’s visit to France

French shipping operator CMA CGM SA has ordered 10 container megaships from state-owned China State Shipbuilding Corp. as part of a string of deals that Chinese President Xi Jinping signed Monday with his French counterpart Emmanuel Macron.

The agreements in France follow a series of deals that Mr. Xi struck in Italy, including pacts with state ports aimed at extending China’s Belt and Road Initiative deeper into Europe.
The CMA CGM purchase, which shipyard executives estimate is valued at more than $1 billion, is for ships that carry 15,000 containers each. The transaction is seen as a significant win for CSSC as it seeks to compete with bigger rivals in South Korea at a time when orders for mega-container vessels are increasingly rare....MORE
The Journal notes:
...Five of the ships will be powered by liquefied natural gas, an increasingly popular choice as regulators push the industry to use cleaner-burning fuel. The other five will be equipped with “scrubbers” that clean ship emissions....
Talk about hedging your bets right down the middle on the natural gas vs scrubbers question.

Does the 15,000 TEU size mean the race to a 25,000 TEU  "Le monstre des mers"* is on hold?
*That's the nickname given to CMA CGM's flagship, "CMA CGM Antoine de Saint Exupery"

As noted a few weeks ago in Container Shipping: "MAN Hired for World’s First Megaship Conversion to LNG Fuel" the current largest container ships are
Hong Kong's Orient Overseas Container Line is currently running the largest capacity container ships at 21,400 TEU with a couple of COSCO's ships also over 21,000 TEU.
CMA CGM's flagship, the Antoine de Saint Exupery clocks in with  capacity of 20,950 TEU and Maersk has a fleet over 20,000 TEUs.
Those might be "Megaships". And the 23,350 TEU behemoths that MSC has on order definitely would have to be.