Italy’s Grimaldi Group is hatching an order worth up to $1bn for 10 ammonia-ready car carriers to be built in China.

The vessels, with a capacity for 9,000 cars, will be built at shipyards within China Merchants Group, managing director Emanuele Grimaldi told TradeWinds.

The Naples-based operating owner has signed a letter of intent that could be firmed up by the end of the month, he added.

Several China Merchants yards are in contention to build the ships, which are expected to cost around $100m each.

“They haven’t decided yet if they would use one or two shipyards. It could be Jinling or Yanfang or other yards owned by the Chinese conglomerate,” Grimaldi said.

Delivery of the first vessels is expected in three years’ time.

Grimaldi was speaking after meeting journalists at the International Chamber of Shipping, where he took over as chairman in June.

The dual-fuel vessels will be far more efficient than earlier designs. They will burn 50% less fuel than the previous generation of car carriers, he said, including a 4,200-ceu series built at Fincantieri in 1998.

Those older vessels consume more fuel and have bigger engines than the newbuildings to be ordered in China.

Grimaldi said the order will be placed as the car carrier market is booming, with shipments of Teslas and other electric vehicles picking up.

Operators have been seeking to accelerate fleet renewal to meet demand for low-emission vehicles.

The ships on order will be built to operate on lower-emission fuels, including LNG, methanol or a hybrid battery propulsion system.

As well as the potential tightening of shipping capacity, demand is rising. Trading volumes are up and the big operators are reporting increased contract renewal rates for this year.

Transportation volumes are also expected to grow on the back of increased global demand for electric vehicles.

The Grimaldi Group, one of Europe’s biggest rolling-cargo shipowners, has an established relationship with several Chinese shipbuilders with which it has orders for a series of newbuildings for delivery by the end of 2024.

These include a series of Grimaldi Green 5th Generation-class eco ro-ros, each with a loading capacity of 7,800 lane metres.

The 10th of 12 vessels, the 67,311-gt Eco Mediterranea (built 2022), was delivered from Nanjing Jinling Shipyard in June.

Grimaldi reported a profit close to $1bn in 2021, helped by its transatlantic container/ro-ro operation Atlantic Container Line.