PARIS, Jan 16 Reuters French shipping giant CMA CGM and FrenchDutch carrier Air FranceKLM on Tuesday said they would withdraw from their existing commercial agreement for cargo transports in view of reshaping the partnership.

Air FranceKLM and CMA CGM have begun discussions on new terms and conditions of a commercial relation to operate independently from March 31, 2024 onwards, the companies said in a statement.

The two companies, which are also linked through a major equity stake CMA CGM holds in the airline, struck a cargo partnership in May 2022, betting on growing demand for flying goods around the world as supply chains remain snarled in the wake of the pandemic.

The companies on Tuesday cited the 39;tight regulatory environment39; in some markets as the reason for ending their cooperation.

Both groups remain committed to work collaboratively, to ensure cargo customers can continue to benefit from their respective networks, said the companies39; joint statement, which also adding that CMA CGM would remain a core shareholder in Air FranceKLM.

Reporting by Tassilo Hummel; Editing by Sudip KarGupta

Source Reuters