CMA CGM Air Cargo Confronts Crosswinds

CMA CGM Air Cargo looked to be facing challenges as its parent shipping group released its second quarter results.

French shipping and logistics group CMA CGM did not provide specific financial figures for its cargo airline, but stated that second quarter revenue “from other activities, which include port terminals and CMA CGM Air Cargo” fell by 5.3% year on year to $474m.

EBITDA was down 61.9% to $50m. CMA CGM attributed the drop to “lower volumes in port terminals and a less buoyant air transport market”.

Group revenue stood at $12.3bn in the second quarter, down 36.9%. EBITDA came to $2.6bn, down 73%.

The company did not specifically mention any plans for CMA CGM Air Cargo, however, the airline, which received its air carrier certificate from the French Civil Aviation Authority in June last year, appears to be in development mode.

The Paris CDG and Amsterdam-hubbed airline currently operates six freighters, four Airbus A330 freighters, and two Boeing 777Fs.

According to CMA CGM’s website, the airline flies to 17 freighter destinations.

CMA CGM Air Cargo also has a capacity partnership with Air France KLM Martinair Cargo (AFKLMP), that was launched in April.

In May, the airline launched a new freighter route between Paris, France and Mumbai, India, as part of its partnership with AFKLMP.

Rodolphe Saadé, chairman and chief executive of the CMA CGM Group, also said: “As expected, our industry continued to normalize in the second quarter and, despite difficult market conditions, our performance remains robust. In recent years, we have significantly strengthened our two strategic pillars: transport and logistics. On that basis, our Group will pursue its transformation, as it continues to expand and to integrate recently acquired subsidiaries, while stepping up investments to decarbonize its activities”.

In an outlook statement, CMA CGM said: “Late 2022 trends continued to prevail in the first half of 2023, with deteriorated market conditions in the transport and logistics industry. Macroeconomic forecasts for the second half of 2023 anticipate sluggish global growth given the persistent inflationary pressures weighing on consumer spending as well as the measures taken by central banks in response, and geopolitical uncertainties.”