News / Indian yard wins order for six small newbuild box ships from CMA CGM

Image: CMA CGM

French ocean carrier CMA CGM has signed a letter of intent for the construction of six small container vessels by Cochin Shipyard (CSL), India’s premier yard.

The order is a “watershed moment” for New Delhi’s “make-in-India” programme, intended to cash in on the China-plus-one manufacturing strategies pursued by multinationals.

The six 1,700-teu newbuilds will be LNG-fuelled and will deliver between 2029 and 2031.

“The newbuilds demonstrate CMA CGM’s commitment to a more sustainable shipping as they can run on LNG and are ready for low-carbon fuels, significantly reducing greenhouse gas emissions, aligning with the group’s ambition to be net zero carbon by 2050,” the carrier said.

“The project at Cochin Shipyard will be run with the technical cooperation of Korean shipbuilder HD Hyundai Heavy Industries,” it added.

The newbuilding order, which will see the ships registered in India, complements a series of container vessel reflaggings, reportedly four, the Marseille-based carrier has lined up in India in recent months, part of a broader strategy to expand operations in the country. CMA has also pledged to recruit 1,000 Indian seafarers by the end of the year, and 500 next year.

“CMA CGM is the first international shipping company to order LNG vessels built in India,” said group chairman and CEO Rodolphe Saadé. “This (shipbuilding) milestone reflects the trust we place in India’s industrial and technological capabilities and supports (Indian) prime minister Narendra Modi’s ambition to make India a global shipbuilding power.”

He said the group, already offered some 19 weekly services out of gateway ports, with a countrywide network/infrastructure employing some 17,000 people. Its landside presence includes expansive warehousing capacity managed by forwarding subsidiary Ceva Logistics, as well as container terminal operations at Nhava Sheva (JNPA) and Mundra.

The newbuilding win follows New Delhi’s sweeping policy reforms, announcing significant incentives for the shipbuilding industry to match the scale of economies with large yards in the Asian region.

Shipyards in India, including CSL and Swan Defence & Heavy Industries, (originally Pipavav), have lately demonstrated stronger intent to scale up their capabilities through strategic partnerships. Two collaborations, with South Korean shipbuilders HD Korea Shipbuilding and Samsung Heavy Industries, being announced recently.

“CSL is committed to deliver high-quality vessels with sustainable solutions to meet the market expectation of future shipping,” said MD Madhu Nair.

“This project is also of great significance to CSL as we are collaborating with the largest shipbuilding group HD KSOE as the major partner, which further reinforces our commitment to bring the best-in-class solutions through partnerships, to serve clients across the globe,” he added.

India has a miniscule share of the global shipbuilding market at present –around 0.06%, so faces an uphill task to compete with established yards in the region. China, South Korea and Japan lead the race, accounting for some 94% of the world’s commercial shipbuilding.