Dive Brief:
- CMA CGM Group is investing $20 billion over the next four years to expand its maritime, warehousing and air cargo operations in the U.S., according to a March 6 press release.
- The funds will allow the shipping company to triple its U.S.-flagged vessels and help digitize and increase connectivity at ports across the country, including New York, Los Angeles, Miami, Houston and Dutch Harbor, Alaska.
- The shipping company will also use the investment toward new or expanded warehouses and automotive logistics platforms across the country, and bolster its air cargo hub in Chicago (ORD).
Source: CMA CGM
Dive Insight:
CMA CGM's planned investments come as the company pushes to establish itself as one of the top logistics service providers in the U.S. and worldwide.
Over the past decade, the company has expanded its presence in the maritime industry — including through acquisitions of U.S. terminals and shipping lines, like the American Presidents Line brand — and diversify its operations to other logistics sectors, such as air cargo. Now, the company is doubling down with a multi-billion-dollar investment in the U.S.
CMA CGM's investment will include $8 billion for containerships, $7 billion for logistics, $4 billion for ports and $1 billion for air cargo, CEO Rodolphe Saadé told The Wall Street Journal.
The investments aim to “ensure the security and reliability of the domestic supply chain, while also advancing U.S. leadership in logistics,” per the press release.
As part of this effort, CMA CGM will also open a logistics research and development hub in Boston to focus on advanced robotics and automation. The move adds to CMA CGM's recent investments in technology, which include a deal with Google to deploy artificial intelligence within its operations.
CMA CGM is also focused on increasing its warehouse footprint to 400 facilities, Saadé told Les Echos. The company currently operates a total of 200 warehouses through its subsidiary CEVA Logistics.
CMA CGM announced the investments in an Oval Office meeting with President Donald Trump. The investments come as the U.S. aims to revive the country's shipbuilding industry and reshape its position in global supply chains. The Trump administration has announced other proposals in line with those goals in recent months, including a proposal to tax China-based ship operators and vessels that call on the U.S.
During the Oval Office meeting, Saadé said the company's goal is to grow its fleet of U.S.-flagged vessels from 10 to 30 — most likely with more to come. Saadé told The Wall Street Journal that the new ships will most likely come from shipyards in South Korea, and the company is still contemplating ship sizes and build timelines.
On the air cargo side, CMA CGM plans to deploy five new Boeing 777 freighters at Chicago O'Hare International Airport (ORD).
CMA CGM’s current freighter fleet consists of an A330 aircraft and three B777s, according to the CMA CGM Air Cargo website. The carrier currently operates a flight connecting ORD to Incheon, South Korea (ICN); Hong Kong (HKG); and Anchorage, Alaska (ANC).
