CMA CGM CUTS ITS TRANSATLANTIC CAPACITY

CMA CGM CUTS ITS TRANSATLANTIC CAPACITY

   CMA CGM will reduce its weekly capacity in the U.S./north Europe trade from 550 TEUs to 425 TEUs a week, effective from November.

   The change is part of a new slot-charter agreement with Mediterranean Shipping Co. on its U.S. North Atlantic/north Europe and U.S. South Atlantic/Guf/Mexico/north Europe services.

   The arrangement between CMA CGM and Mediterranean Shipping Co. will replace the French shipping line’s slot-charter deal with Maersk Sealand, which expires at the end of October.

   Rodolphe Saade, vice president, North America Lines, said that the reduction in CMA CGM’s capacity allocation reflects difficult market conditions and the current situation of below-cost freight rates on the North Atlantic route.

   CMA CGM had already reduced its allocation with Maersk Sealand to 550 TEUs a week, from 600 TEUs when the agreement started two years ago.

   However, Saade said that the agreement with Mediterranean Shipping Co. will provide CMA CGM’s customers with improved port coverage, including direct calls at Boston, Baltimore, New Orleans, Veracruz, Altamira, Antwerp and Hamburg.

   Saade estimates that there is about 15 percent overcapacity in the transatlantic trade. He welcomed the recent news that COSCO, “K” Line, Yang Ming, Hanjin Shipping and Senator are planning to withdraw about 2,500 TEUs in weekly capacity from the transatlantic trade early next year.