CMA CGM CEO: Unwise to Expect Strait of Hormuz Returns to Pre-War Status
Impact of the Iran War on CMA CGM and Global Shipping
Current Situation in the Strait of Hormuz
PARIS, June 9 (Reuters) - It would be "unwise" to assume that the situation in the Strait of Hormuz will return to how it was before the Iran war, the head of French shipping group CMA CGM said on Tuesday.
CMA CGM, the world's third-largest container line, is among firms with vessels stranded inside the Gulf since the start of the conflict that has virtually closed the waterway, which carries a fifth of global oil and LNG supply.
CEO's Perspective on Future Risks
"Even if a solution for peace is implemented in the coming weeks, there's no guarantee there won't be another crisis later on and we can't be prisoners to Hormuz," CMA CGM's Chairman and CEO Rodolphe Saade told a French parliamentary hearing.
"I won't be fixated on the idea that the Strait of Hormuz is going to reopen and everything will return to how it was," he said. "Unfortunately, I think it would be unwise to react like that."
Operational Adjustments and Financial Impact
Alternative Routes and Logistics
CMA CGM may continue to offer clients alternative routes as it adapts to a turbulent geopolitical context, Saade added.
Like its rivals, Marseille-based CMA CGM has rushed to bypass Hormuz to reach the Gulf, hauling cargo by road and rail from more distant ports.
Reduction in Container Volumes
Saade, who controls the group with other family members, said that CMA CGM was transporting around a third the number of containers to the Gulf compared with before the war.
Increased Costs Due to Rerouting
The group estimates using alternative routes will cost it an extra $300 million in the first half of the year, Chief Financial Officer Ramon Fernandez told the parliamentary hearing.
Vessels Affected by the Conflict
CMA CGM had 14 vessels trapped inside the Gulf at the start of the Iran war. Two have since left but one of the remaining ships was struck last month in an attack that injured eight seafarers.
(Reporting by Gus Trompiz;Editing by Tomasz JanowskiEditing by Sudip Kar-Gupta)
