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CMA CGM and Air France-KLM end joint venture

CMA CGM and Air France-KLM end joint venture
CMA CGM and Air France-KLM end joint venture
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French shipping and logistics company, CMA CGM Air Cargo, CMA CGM Air Cargo looks to expand into the US following its decision to end its venture with Air France-KLM The Loadstar reports. The existing agreement will end on March 31, 2024. 

On January 16, Air France-KLM issued a statement announcing the end of its joint venture. “The tight regulatory environment in certain important markets has prevented cooperation from working in an optimal way,” the statement reads. The parties have begun discussing new terms and conditions for a commercial relationship to operate independently. 

Air cargo provides agile logistics solution  

The CMA CGM launched its air cargo operations in 2021. This was in response to customers needing agile logistics solutions. 

The air cargo provides a link to Europe, Asia, China, and the US. 

In April 2023, Air France-KLM announced a long-term air cargo partnership. The partnership was set for a duration of 10 years. The venture was set up to provide customers with a more resilient and integrated supply chain. 

Also read: Target the latest company affected by Red Sea crisis

Challenging time in air freight space 

The year 2023, however, was a challenging one. Logistics giant UPS noticed particular shifts. Marco Tafuro, air freight director for Europe, explained: “It has been a challenging year, but we’ve learned quite a lot. There has been a switch from air cargo to other modes of transport.”

While the Red Sea crisis rages on, logistics companies may look to air freight to solve supply issues and get goods to customers fast.

Global transport and logistics company Bolloré Logistics has anticipated additional airfreight capacity from mid-January to early February from China to Europe. 

Air Cargo Week reports retailers are taking to the skies for their supply chains to keep shelves stocked with goods. 

Airfreight rates set to rise in February 

Xeneta, headquartered in Oslo, has the world’s largest ocean airfreight and ocean freight benchmarking platform. 

The company’s ocean freight rate benchmarking platform calls upon over 400 million crowdsourced data points. The latest projection is based on rates already received from customers for the first week in February.” 

The company’s chief airfreight officer, Niall van de Wouw, says: “Routes from Vietnam to Europe are used heavily for apparel, a sector we have been told is switching more goods from ocean to air due to the Red Sea crisis, so it is particularly noteworthy we are seeing volumes increase to such an extent on this trade.

“We should also recognize that the upcoming Lunar New Year may also be contributing to the increase in volumes.” 

Air cargo market 

Mordor Intelligence reports the global airfreight market is set to grow at a compound annual growth rate of 5.92% in the next five years. 

Growth in e-commerce has opened great opportunities for the airfreight industry. “This online shopping phenomenon has become a global norm as consumers worldwide embrace the convenience of digital transactions, reads the report. 

Now Read: Red Sea crisis: Australia recalls livestock ship

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About the author

Sharl is a qualified journalist. He has over 10 years’ experience in the media industry, including positions as an editor of a magazine and Business Editor of a daily newspaper. Sharl also has experience in logistics specifically operations, where he worked with global food aid organisations distributing food into Africa. Sharl enjoys writing business stories and human interest pieces.

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