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Port of New York and New Jersey Green Lights CMA CGM’s Takeover of Two Key Container Terminals

The CMA CGM Marco Polo passes under the Verrazzano-Narrows Bridge, to enter New York Harbor as seen from Brooklyn, New York, U.S., May 20, 2021. REUTERS/Brendan McDermid

Port of New York and New Jersey Green Lights CMA CGM’s Takeover of Two Key Container Terminals

Mike Schuler
Total Views: 6990
August 23, 2023

The Port Authority of New York and New Jersey has agreed to amend leases held by Global Container Terminals Inc. (GCT) at two key container terminals in New Jersey and Staten Island, paving the way for French shipping giant CMA CGM to assume operations and increase capacity at the terminals.

The amended leases will allow CMA CGM, one of the world’s largest shipping companies, to takeover operations at the Port Jersey-Port Authority Marine Terminal in Bayonne, N.J. and the Howland Hook Marine Terminal on Staten Island, known as GCT Bayonne and GCT New York, respectively. The two terminals have a current combined capacity of 2 million TEUs per year.

CMA CGM announced its intent to acquire the terminals in December, saying it plans to accelerate investments to increase capacity by as much as 80%.

The updated leases involve rent increases based on throughput, full responsibility for wharf and berth repair and replacement, and significant investments in facilities to increase container capacity.

“This lease agreement marks the beginning of a new chapter at two of our key container terminals,” said Port Authority Chairman Kevin O’Toole. “We look forward to working with CMA CGM as these facilities reach their full potential, bringing even more jobs and economic growth to power the region.”

As part of the amended leases, CMA CGM has agreed to pay increased rent based on container throughput, subject to a minimum annual guarantee, as well as share revenue from excess container storage. It will also assume responsibility for maintaining and rebuilding wharf and berth structures, and has agreed to increase capacity at both facilities to meet demand.

“We welcome CMA CGM as a key partner in the operation of two of our marine terminals, and look forward to working closely with CMA CGM in the future vigorous development of our seaports,” said Port Authority Executive Director Rick Cotton. “This deal with CMA CGM reflects the trust and confidence of our business partners in our port’s ability to move cargo efficiently and reliably.”

CMA CGM has also committed to the Port Authority’s goal of achieving net-zero greenhouse gas emissions by 2050, upgrading to zero-emissions material handling equipment, promoting renewable energy, and contracting goals for minority-owned, women-owned, and service-disabled veteran-owned businesses, and maximizing the use of locally owned businesses.

The Port Authority has a longstanding relationship with CMA CGM, including welcoming the largest container ship ever to call on the port and the U.S. East Coast, the CMA CGM Brazil, to a terminal in the Elizabeth-Port Authority Marine Terminal in 2020. The Port Authority also completed the raising of the Bayonne Bridge’s roadway to allow higher navigational clearance through the Kill van Kull for the world’s largest container ships seeking to access the port’s New Jersey and Staten Island facilities, with CMA CGM’s 14,000-TEU capacity CMA CGM Theodore Roosevelt being the largest container ship to call at the port in September 2017.

The addition of the two terminals will be bring CMA CGM’s portfolio to seven terminals in the United States. Globally, CMA CGM has stakes in 52 port terminals in 28 countries through CMA Terminals and its Terminal Link joint venture.

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