Energy as a critical factor
Pursuing a four-pronged strategy to transform energy use and to reduce emissions. CMA CGM is seeking to link the transition to new propulsion and fuel options with its decarbonisation strategy. Over the next five years the carrier is set to pour USD 1.5 billion into research into and conversion to alternative technologies.
There is no patented solution to an emissions-free future. Not one propulsion technology or fuel points to the ideal way yet to achieving decarbonisation by the deadline of 2050 set by the International Maritime Organization (IMO). After a long dry spell, the major carriers now also have the means to invest massively in future technologies and research.
Thus CMA CGM, from Marseille (France), is bundling its activities in this context in a special fund for energy, with a budget of approximately USD 1.5 billion for the next five years. The French shipping line has identified four focal points.
First, it is investing in the development and production of renewable fuels such as liquefied natural gas (LNG), bio-fuels, bio-methane, carbon-free methanol, e-methane and the like.
The second focus is on using renewable energy sources and focusing on accelerating the corporation’s overall decarbonisation strategy. Port terminals, warehouses and truck fleets are being converted. In addition to the increased use of e-drives for vehicles, 1.8 million m2 of photovoltaic panels will be installed and the use of LED lighting will be expanded, amongst other measures.
The third pillar is developing prototypes, such as a containership that runs on liquid hydrogen, or a sail-powered cargo ship that can, by the end of 2024, serve trans-Atlantic routes. CMA CGM is a shareholder in one such operating company, Neoline.
The fourth focus is on the classic path of energy saving and greater energy efficiency in the group, involving all of the company’s roughly 150,000 employees.
Necessary small change generated in Q2 / 2022
Looking at the company’s results for Q2 / 2022, the carrier continued its success in the ongoing boom. The quarter’s revenues came to USD 19.5 billion and ebitda to USD 9.6 billion – an ebitda margin of 49.2%.
In Q2 / 2022 net debt was significantly reduced, namely by USD 1.5 to 5.4 billion on 30 June 2022 (after taking current financial investments into account).
In the second quarter of 2022 CMA CGM carried 5.6 million teu, a slight decrease of 1.3% compared to the same period in the previous year. Volume growth is currently being held back less by demand, CMA CGM said, but rather by “congestion at ports and in inland supply chains”, which has accordingly led to longer vessel transit times.
Revenues from the logistics business, mainly those generated by the corporation’s subsidiary Ceva Logistics, totalled approximately USD 3.8 billion in the second quarter of 2022, while the concomitant ebitda came to USD 340 million.
The line’s operating costs climbed by more than 22% year-on-year, due to price increases for bunkering, ship charters and port handling. Bunker costs rose by almost 75% in Q2 / 2022. The energy fund thus makes great sense.