CMA CGM and Air France-KLM abandon air cargo alliance

French shipping group CMA CGM and carrier Air France-KLM are scrapping an air cargo partnership after struggling to get US approval to operate North American routes and deliver on the project’s promise in the wake of pandemic lockdowns. The companies said on Tuesday they would end a tie-up announced in 2022 at the end of March, citing regulatory constraints, and that each would go back to operating their own cargo aeroplane fleets while still trying to co-operate on some routes. One of the biggest hurdles had been the partnership’s difficulty in getting antitrust approval to operate in and out of the US, killing off one of their biggest markets, two people familiar with the matter said. “A constrained regulatory environment on some important markets did not allow us to co-operate in an optimal fashion,” the companies said. The original 10-year deal, which was partly motivated by CMA CGM branching into new avenues on the back of Covid-19 era windfall profits, was coupled with a direct investment by the shipping group into the Franco-Dutch airline group. CMA CGM will keep its 9% stake in Air France, but a lock-up on those shares will end in February 2025 and no longer be partly extendable until 2028. The Marseille-based transport group, the world’s third biggest container shipping company, will also give up its seat on the board of Air France-KLM. The airline group also counts the French and Dutch governments as big shareholders, and had welcomed CMA CGM as it looked to turn the page from Covid-19-related bailouts and raise fresh capital.<br/>