Air France-KLM and CMA CGM sign major air cargo deal

Air France-KLM Group and the CMA CGM Group today announced that they have signed a long-term strategic partnership in the air cargo market. With the unrivalled know-how and worldwide presence of Air France-KLM and CMA CGM, both parties will combine their complementing cargo networks, complete freighter capacity, and dedicated services to produce an even more competitive offer.

A 10 -year exclusive strategic commercial collaboration to expand their air cargo business

CMA CGM and Air France-KLM share a strong desire to invest in and expand the air freight sector in a sustainable manner.

The agreement's initial term will be 10 years. Air France-KLM and CMA CGM will join and operate only their respective airlines' full-freighter aircraft capacity, initially consisting of a fleet of 10 full-freighter aircraft, with an additional combined 12 aircraft on order, consisting of 4 full-freighter aircraft at CMA CGM Air Cargo (with outstanding orders for an additional 8 aircraft, 2 of which may be operated by Air France-KLM in the future) and 6 full-freighter aircraft at Air France- (with outstanding orders for an additional 4 aircraft).

This new commercial collaboration extends to Air France-belly KLM's aircraft capacity, which includes more than 160 long-haul aircraft.

The collaboration will use both partners' separate worldwide sales teams to provide a single voice to the client.

According to the official release, the strategic commercial relationship is projected to provide considerable revenue synergies, including shared design of entire freighter networks and expanded product and service mix potential.

It will fulfil clients' growing need for more integrated and robust supply chains by using Air France-huge KLM's existing business, expertise, and capabilities in air freight, supported by a worldwide cargo network. CMA CGM will deploy its extensive commercial network and worldwide logistics platform, and will complement this offering with new logistics and multimodal solutions, notably in sea and land transport.

CMA CGM Group will become an Air France-KLM Group reference shareholder

CMA CGM will strengthen its commitment to the air freight business as part of its long-term exclusive collaboration by becoming a new reference shareholder in Air France-KLM. CMA CGM has the firm intention to take up to 9% of Air France-KLM's ex-post share capital, for a period consistent with the implementation of the strategic commercial partnership.

Rodolphe Saadé, Chairman and CEO of the CMA CGM Group said: " It allows us to significantly accelerate the development of our air division, CMA CGM Air Cargo, which was created just over a year ago, and to position our two companies among the world's leading players in air freight. This partnership is fully in line with CMA CGM's strategy and its ambition to become a leader in integrated logistics, for the benefit of its customers. Through our stake in the company, Air France-KLM will be able to count on us to support its future development."

This investment might be undertaken as part of Air France-planned KLM's capital increase, which was announced on February 17th, 2022. Air France-KLM's main shareholders will support a resolution for the appointment of one board member representing CMA CGM at the next shareholders' meeting (May 24th, 2022).If accepted by the shareholders, such an appointment would be contingent on the fulfilment of CMA CGM's investment.

Benjamin Smith, CEO, Air France-KLM Group said: "This strategic partnership leverages the complementary skills, expertise and activities of Air France-KLM and CMA CGM. It is a landmark step which will significantly strengthen and expand the Group's position in the air cargo industry. I am also extremely pleased that this commercial partnership with CMA CGM has resulted in their decision to invest directly in the Air France-KLM Group, demonstrating a strong testimony of their belief in the future success of our Group."

Air France-KLM and CMA CGM are two global players with European roots and strong dedication to sustainability

Air France-KLM and CMA CGM are transportation and logistics sector leaders. They both want to promote sustainability and have committed to reaching Net Zero Carbon by 2050.

Air France-KLM is considered as one of the most important airline groups in the world of airfreight. It operates a large fleet of Full Freighter and Wide Body Belly (WBB) aircraft from two global hubs at Paris-Charles de Gaulle airport and Amsterdam Airport Schiphol, both of which are equipped with cutting-edge cargo facilities and serve 295 destinations in 110 countries.

Air France-KLM has teams at 116 stations supporting a total network of 390 handling stations distributed across all continents, making its commercial network one of the most extensive in the airfreight sector. Air France-KLM has a long history of specialty cargo (pharmaceuticals, perishables, express, etc.) and has built one of the most advanced digital service systems in the air freight sector.

Air France-KLM operates a one-of-a-kind and industry-leading digital distribution platform where consumers can book flights and manage their accounts 24 hours a day, seven days a week. It also sets the standard for sustainability, launching the Sustainable Aviation Fuel (SAF) Program in December 2021.

CMA CGM advances its strategic transformation into a global logistics leader. With this industrial collaboration, the CMA CGM Group is moving forward with its aim to develop and deploy end-to-end shipping and logistics solutions to support its clients' supply chains. During the previous three years, the Group announced the acquisitions of CEVA Logistics, Ingram Micro's Commerce & Lifecycle Services (CLS), Colis Privé, and GEFCO. CMA CGM's strategic evolution into a global logistics leader has been boosted by these businesses.

Saadé created CMA CGM Air Cargo in March 2021, a completely new operational and commercial branch specialising in air freight. CMA CGM Air Cargo offers the Group's clients a service that capitalises on the tight fit between shipping and logistics. This air cargo segment has been quickly developing, thanks in part to the arrival into service of many full-freighter aircraft and orders for additional aircraft that will greatly increase capacity in the next months and years.