CMA CGM and CSSC Sign Largest Containership Order Valued at $3B
CMA CGM is reported to have signed the largest container shipbuilding order placed in China for a total of 16 new vessels to be built by yards within the China State Shipbuilding Corporation (CSSC) group. The order was placed as part of a series of agreements concluded by French companies during a state visit by French President Emmanuel Macron and European Commission President Ursula von der Leyen.
Chinese state media is releasing the first news of the agreement which was also reported by the China Chamber of Commerce to the EU. They are saying that CMA CGM signed an order for two classes of vessels in a total deal valued at 21 billion Chinese Yuan (nearly $3.1 billion). Signed in Beijing on April 6, it would become the largest containership building order and a continuation of CMA CGM’s longstanding relationship with the Chinese state shipbuilder.
The order is also the first for China for methanol dual-fuel containerships. Twelve of the vessels will have a capacity of 15,000 TEU and use a methanol-ready engine. In addition, CMA CGM ordered four additional 23,000 TEU LNG dual-fuel vessels, which are likely a continuation of the Jacques Saadé class built by CSSC with the first vessel introduced in 2020. Indications are that the order will be split between the Hudong-Zhonghau, Jiangnan, and Dalian shipyards. No timing was announced for the delivery of the vessels.
Macron was conducting his first state visit to China in three years seeking to strengthen economic ties and get China’s support for the war in Ukraine. The trip began on Wednesday, April 5, and concluded today with a rare personal meeting with China’s President Xi Jinping. Chinese media highlighted the visit as an opportunity to strengthen the country's ties with Europe and counter America’s policies of containment against China.
The South China Morning Post is reporting that France and China have grown their economic ties exceeding $100 billion for the first time in 2022. France indicated that approximately 20 major economic deals were signed during the visit which concluded today. In addition to CMA CGM, Airbus agreed to expand production in China and Alstom reached new agreements. The French Electric Power Company (EDF) signed a new nuclear deal and also will work with China Energy Investment Corporation for a wind power project. Consumer companies including L’Oreal and France pork producers also reached agreements.
CSSC highlighted a visit by CMA CGM Chairman Rodolphe Saadé to the company in February 2023. During the visit to CSSC, he met with Wen Gang, chairman of China State Shipbuilding Corporation, and senior executives setting off speculation that CMA CGM was preparing to place another large shipbuilding order.
The two companies have worked together for a decade with CSSC reporting that CMA CGM has ordered more than 70 containerships to be built in China. This includes more than 30 that have been delivered including the first ultra-large 18,000 TEU boxships built in China and the Jacques Saadé class which were the first large LNG-fueled containership ships. CSSC’s shipyards built a total of nine of the vessels which each have a capacity of just over 23,000 TEU.