Air France-KLM signs major air cargo deal with French CMA CGM
French shipping company CMA CGM has acquired a 9% stake in Air France-KLM as part of a 10-year cooperation agreement. In addition, the shipping company and the Air France-KLM Group will share all air cargo capacity in the future. This involves the AF-KLM and the total belly capacity of 22 freighters, 12 of which are still on order from Airbus.
Specifically, the deal means that CMA CGM will become the third major shareholder in the airline company in addition to the French and Dutch states, and thus President Emmanuel Macron has found a third lender for the heavily indebted Air France-KLM.
Thanks to billions of dollars in profits over the past two years, CMA CGM Group has deep pockets and recently helped the French government out of the Euro when it needed to find a solution for Russia’s majority stake in French shipper Gefco. Those shares have in the meantime ended up with CMA CGM.
The shipping company will also play the role of ATM in Air France-KLM (through a capital increase). All in all, the airline group is looking for 4 billion Euros. In return, CMA CGM will not only get a 9% stake in the airline group, but also a seat on Air France’s board of directors.
It is unclear how the deal will work out. Air France-KLM finance director Steven Zaat speaks of “significant revenue benefits” from the development of a combined “cargo network” that will be jointly marketed. The agreement should thus help shippers to better organized supply chains, Zaat said. Further financial details were not disclosed.
Focus to Paris
Air cargo experts expect the Air France-KLM combined cargo company, led by KLM’s Adriaan de Heijer, to soon shift its focus from Schiphol to Paris because of the deal. It remains to be seen who will be in charge of the new combined cargo network, but CMA CGM has made no secret of the fact that, with the backing of the Elysee Palace, it is creating its own cargo company (CMA CGM Air) and headquartered in Paris-Charles de Gaulle.
The Marseilles-based shipping company has ordered four A350Fs from Airbus and already has four A330Fs in its possession. Air France has two B777-200Fs, but recently surprised the market with an order for eight A350Fs. The deal with CMA CGM suddenly made the order make more sense. With KLM’s four B747 freighters, the group will soon have three different types of freighters.