CMA CGM Place Six Mega-Boxship Order


CMA CGM has recently placed an order for around six 14,000 TEU ships with shipbuilder Hyundai Heavy Industries, which are expected to be delivered between 2016 and 2017, with its total backlog of ships amounting to 13 from Korea, China and the Philippines, according to Splash 247.

PTI previously reported two ship orders from CMA CGM, one being for three 20,000 TEU box-ships at a total cost of US$ 470 million and a follow-up order for another three mega container ships.

CMA CGM are among many container lines who appear to be competing with each other to claim the highest economies of scale, with Maersk recently announcing its eleven 19,000 TEU ship order.

This is creating a buzzword in the industry called ‘leapfrogging’, which is the term used to describe shipping lines that have been overtaken in the capacity of ships ordered by TEU.

To read more about the impacts of mega-ships on ports and terminals, click here

The velocity of mega-ship orders is going through an intense phase, raising concerns as to how mega-ships will raise the finance for such massive orders, with some industry professionals believing that shipping lines could go bankrupt unless they sell off their assets to pay for the orders.

Ports are also at risk of increasing orders and capacity of ships and have acted, as was recently the case in the US, by spending billions on port infrastructure.

This decision may not be the most efficient due to the cost involved. The Port of Rotterdam has recently suggested that ‘Port Call Optimisation’ could be a more efficient alternative to infrastructure investment.

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