CMA CGM Partners with Abu Dhabi Ports to Develop New $154M Terminal

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Image courtesy CMA CGM / AETOSWire

Published Sep 13, 2021 1:28 PM by The Maritime Executive

French shipping giant CMA CGM has announced the signing of a 35-year agreement with Abu Dhabi (AD) Ports for the development of a $154 million terminal at Khalifa Port. The project will provide the company with a new regional hub to develop its service offering between Abu Dhabi and South Asia, Western Asia, East Africa, Europe and the Mediterranean, as well as the Middle East and the Indian subcontinent.

“This state-of-the-art terminal will contribute to enhancing Khalifa Port’s position as a leading global hub and to boosting the region’s economy, accelerating trade flows in and out of Abu Dhabi. It will also enable our group to expand its shipping and logistics network in the region where we see a lot of growth potential,” said Rodolphe Saadé, CMA CGM Group chairman and CEO.

The new terminal will be managed by a joint venture owned by CMA CGM’s subsidiary CMA Terminals (with a 70 percent stake) and AD Ports Group (with a 30 percent stake). Construction of the new terminal will start this year, with completion slated for 2024.

According to the agreement, AD Ports will be responsible for developing a wide range of supporting marine works and infrastructure, including 4,000 feet of quay wall, a 12,500-foot breakwater, a fully built-out rail platform and 170 acres of terminal yard space.

“The addition of a new container terminal at Khalifa Port opens a new chapter in our organization’s efforts to become a key facilitator of global trade and elevates Abu Dhabi’s standing as both a regional and an international hub,” said Mohamed Juma Al Shamisi, AD Ports group CEO.

Owing to their central geographical location, the United Arab Emirates (UAE) and Abu Dhabi aim to be the center of international trade routes. Currently CMA CGM connects the UAE to the world with 13 weekly services to nine ports.

The investment in Khalifa Port forms part of CMA CGM's global expansion strategy. The company currently operates 49 port terminals in 27 countries via its subsidiaries CMA Terminals and Terminal Link.

The signing of the concession agreement came on the day when CMA CGM announced they will stop increasing spot freight rates for all services operated under its brands, easing the pressure on customers who are feeling the heat of soaring charges. The decision to halt spot rate hikes takes effect immediately and will be in place until February 1, 2022.

CMA CGM also announced heavy investments in strengthening their service offering, and have increased the capacity of their operated fleet by 11 percent since December 2019 through the addition of new and second-hand vessels. Over the last 15 months, the company has also increased its container fleet by 780,000 TEU.