Tuesday, June 17, 2008

Shipping magnate makes waves in the Mediterranean

CMA CGM, Saade's company, is one of two container lines to have risen rapidly from Mediterranean foundations to dominate much around them.

Mediterranean Shipping Company, founded in 1969 by Gianluigi Aponte, was the world's No 4 container line only seven years ago but has leapfrogged slower-growing Asian lines to become No 2. CMA CGM has gone in the same period from No 5 to No 3. It operates 393 vessels, to MSC's 398, according to figures from AXS Marine, a Paris shipbroker. Both lines have been quicker than Asian rivals such as Taiwan's Evergreen Marine to invest in new, larger ships to serve the fast-growing market bringing Asia's exports to Europe and the US. Their latest orders, which are able to carry roughly the equivalent of 12,000 20-foot containers (TEUs) are twice the biggest vessels of a decade ago and are aimed at Asia-Europe trade. They will cost $170 million each. MSC's outstanding ship orders will increase its existing capacity by 44.7 per cent, according to AXS Marine, while CMA CGM's orderbook will boost its capacity by 67.5 per cent. The risk is that fleet ex-pansion will outpace demand, pushing down the rates the lines can charge and hampering their ability to pay for the vast new vessels. World container capacity is set to grow by more than 15 per cent this year alone. Published financial information gives little idea how the lines would handle a slump.

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