According to Reuters, the alliance, which was conceived as part of CMA CGM’s strategic expansion into logistics following significant profits from shipping during the COVID-19 pandemic, has faced challenges in obtaining antitrust approval to operate on North American routes.
The companies cited a “constrained regulatory environment” in key markets as the main reason for their decision to terminate existing agreements by 31 March 2024.
Despite the dissolution of the airfreight partnership, both CMA CGM and Air France-KLM say they intend to continue working together on certain routes while operating their own fleets of freighters.
Under the original 10-year agreement, CMA CGM took a stake in Air France-KLM to help it recover from the pandemic and raise fresh capital. However, the Marseille-based shipping group will retain its 9% stake in Air France, with the lock-up on those shares set to expire in February 2025.
According to the Financial Times, the collapse of the alliance follows a trend in the industry, with rivals such as Maersk and MSC also venturing into air freight in response to the surge in demand during the pandemic. The unforeseen boom in air freight was driven by grounded passenger flights, leading to increased demand for alternative transport solutions.
The regulatory burdens faced by CMA CGM and Air France-KLM were reportedly exacerbated by earlier plans by the Dutch government to reduce flights at Amsterdam’s Schiphol Airport for environmental reasons. Although the Dutch authorities later abandoned the plan, the residual impact on the regulatory climate remained unfavourable for the antitrust approval of the partnership in the United States.