HMM is set to significantly expand its Algeciras Container Terminal (TTIA) in Spain, aiming to solidify its position as a crucial Mediterranean transshipment hub. This strategic investment, totaling €150 million, will boost the terminal’s capacity and extend its operational period, reflecting HMM’s broader ambition to enhance its global terminal presence and strengthen European route competitiveness.
HMM’s Strategic Expansion in Algeciras
HMM, a leading South Korean container shipping company, has announced a major expansion plan for its Algeciras Container Terminal (TTIA) in Spain. This move is part of HMM’s strategy to bolster its role in global shipping and capitalize on Algeciras’s growing importance as a transshipment hub, particularly with recent vessel diversions from the Red Sea and congestion in other European ports.
Investment Details and Phased Development
On June 30, HMM submitted a letter of intent to the Port Authority of Algeciras outlining the first phase of the expansion. The total investment for this phase is projected to be €150 million ($177 million), with HMM contributing €35 million ($41 million). The remaining funds will be sourced from co-owner CMA CGM and external borrowings.
The expansion will occur in two phases:
- Phase 1 (by 2028):
- Increase total area from 300,000 square meters to 460,000 square meters.
- Boost annual handling capacity from 1.6 million TEU to 2.1 million TEU.
- Phase 2 (completion):
- Further increase annual handling capacity to 2.8 million TEU.
To facilitate this long-term development, the terminal’s operation period will be extended by 22 years, from 2043 to 2065.
Algeciras: A Key Transshipment Hub
Algeciras is recognized as a vital transshipment hub in Southern Europe and a gateway for Spanish imports and exports. HMM’s investment underscores the port’s strategic significance, especially as global shipping alliances reorganize and demand for efficient transshipment points grows. HMM acquired 100% of TTIA in 2017 and later sold a 50% stake to CMA CGM in 2020, forming a strategic alliance.
Broader Terminal Investment Strategy
This expansion is a cornerstone of HMM’s broader growth strategy, which includes active investment in and development of overseas terminals. The company is reportedly exploring additional investments in ports worldwide, including:
- Los Angeles
- Long Beach
- New York and New Jersey
- Santos, Brazil (potential bidding for a new terminal)
HMM aims to expand its core container business capacity to 1.5 million TEU with 130 vessels by 2030, up from its current capacity of approximately 938,000 TEU with 86 vessels. This aggressive expansion reflects HMM’s commitment to strengthening its competitiveness and adapting to the evolving landscape of global shipping alliances, particularly its increased role in the new Premier Alliance alongside Ocean Network Express (ONE) and Yang Ming.
Sources
- HMM, CMA CGM to expand key Mediterranean transshipment hub, Journal of Commerce.
- HMM to Expand Algeciras Terminal in Spain, Businesskorea.
- HMM to expand Spanish Algeciras terminal, m.theinvestor.co.kr.
