CMA CGM To Support American ‘s Economy

Local politicians, industry bosses and labour leaders all lined up to welcome the 17,800 teu CMA CGM Benjamin Franklin as it berthed at APM Terminals’ Pier 400 after its maiden voyage from China.

News ID: 60257

Date: 10 February 2016 - 16:50

The message was clear. US west coast ports are 'big ship ready' and able to claim world-class status in their ability to handle the latest generation of ultra large containerships.
The welcome party for CMA CGM’s latest newbuilding included the Mayor of Los Angeles Eric Garcetti, Congresswoman Janice Hahn, Port of Los Angeles executive director Gene Seroka, Federal Maritime Commission chairman Mario Cordero, International Longshore and Warehouse Union Local 13 president Bobby Olvera, Captain of the Port Jennifer Williams, APM Terminals' Pier 400 managing director Steven Trombley and other dignitaries, as well as CMA CGM (America) president Marc Bourdon.
All had joined a boat tour on Boxing Day to get a close-up look at the ship, berthed next to the 13,100 teu Maersk Edmonton that had held the record as the biggest containership to call in the US for less than four days. And they queued up to tell the rest of the world that Los Angeles was just as capable of handling this size of vessel as ports in Asia or Europe where 18,000 teu-class ships entered service almost three years ago with the arrival of Maersk’s first Triple-E, Maersk Mc-Kinney Moller.
“This is not just great news for Los Angeles but for our entire economy,” Mr Garcetti said. “There is no better place to come to than Los Angeles, no better place to grow your business than here in Los Angeles where we have been breaking records all year — including cargo records. And this is the best place to reach the American consumer. We have the best workers here, the best logistics here, and we are spending over $1m a day to improve this port and its operations.”
The protracted negotiations, which dragged on for a year, contributed to the severe disruption and delays along the west coast in late 2014 and early 2015, forcing ships to anchor outside ports for days waiting for a berth to become clear. The gridlock damaged businesses across the US and left cargo interests seriously disillusioned and casting around for alternative gateways in Canada, Mexico and on the other side of the country.
Furthermore, US west coast ports do not have much time left to repair their damaged reputations, given that the five-year contract signed between the PMA and ILWU was backdated to July 2014. That leaves little more than three years before the current deal expires, and shipper leaders are already sending ominous warnings to port authorities, terminal operators and union bosses about the consequences they face unless a new employment model is found.
Yet no clear solutions have surfaced other than calls to ensure that rank and file longshore workers are engaged in the process of rebuilding customer confidence.
In the long term, “labour has the most to lose” if west coast ports continue to shed market share to competitors in Canada, Mexico and on the US Gulf and east coasts, Jonathan Gold of the National Retail Federation said in a presentation to the Cargo Logistics America show in San Diego late last year.
CMA CGM’s latest newbuilding will make one more visit to the US as part of the Pearl River Express service, calling at Pier J in Long Beach, in which the French line has a 10% shareholding, and Seattle, before being redeployed in the Asia-Europe trades, Mr Bourdon revealed.
For, contrary to appearances, US ports are not yet ready for these jumbo-sized ships.
Containers on the vessel were only loaded to seven tiers on the deck rather than the 10-high stacks that would be possible if the cranes were big enough. That meant the ship arrived carrying just under15,000 teu rather than a full payload.
“These are trials,” Mr Bourdon told Containerisation International during the boat trip to see CMA CGM Benjamin Franklin as it was being unloaded. “We need to be able to deploy these ships fully laden, so we need to wait for the cranes to be ready, and that is likely to happen by the end of 2016. Then it will be a matter of reassessing market conditions and deciding what we will do.”
In the meantime, “investment needs to happen everywhere”, he continued. “As soon as all the ports are ready, we will reconsider our strategy.”
Faith in long-term potential
However, CMA CGM is also keen to demonstrate a strong commitment to the US, with the line in the process of acquiring Neptune Orient Lines, owner of APL, the former American President Lines and a major player in the Asia-US trades.
Group chairman and chief executive Jacques Saadé, who was in Los Angeles in October, made the decision to deploy an 18,000 teu class ship on the Pacific “to show CMA CGM’s faith in long-term growth potential of the US economy” and underline the French line’s aim to increase its US market share.
It is now just a matter of time before Los Angeles, Long Beach and other US Pacific seaboard ports catch up with those in the Asia-Europe trades which are routinely handling ships somewhat larger than CMA CGM’s new arrival.
MSC’s 19,224 teu Oscar-class ships currently hold the record for container-carrying capacity, although, at 394 m in length, they not the largest in terms of physical dimensions. Maersk’s Triple-E ships are 399 m long and 59 m wide.
CMA CGM Benjamin Franklin, the sixth and last in the series, is also 399 m long, but slightly narrower at 54 m.
Now the terminals are preparing to invest so that ULCs can arrive in the US fully laden, with Pier 400’s Mr Trombley confirming that the facility would be raising the height of some of its cranes from 135 ft to 160 ft in order to accommodate the world’s largest containerships. Cranes on Pier J in Long Beach are also being raised in time for CMA CGM Benjamin Franklin’s return visit, scheduled for February 18.
For the ports, it is a badge of honour to be able to receive the biggest ships ever built. But for ocean carriers grappling with some the worst trade conditions the container shipping trades have encountered, it will come as some relief that ULCs are unlikely be a regular sight on the Pacific quite yet.