Declining air freight – various news items

 At UK airports, CAA figures show air freight tonnage has fallen each month since May. (see below).  It had been rising during the first part of the year. IFW reports that Lufthansa Cargo is cutting 20% or even 30% of its cargo capacity in the new year, to counter anticipated slowdown in demand. (a 25% drop = one aircraft). Lufthansa has shelved its plan for a new cargo hub at Frankfurt, as there is a night flights ban from 11pm to 5am. Moving flights elsewhere is now costing it many millions of €s.



LC (Lufthansa Cargo) plans drastic new year cut in capacity to meet slowdown

Tue, 22 Nov 2011 At least 20% will be withdrawn, with aircraft grounded until second half
Lufthansa Cargo (LC) plans to withdraw at least 20% of its cargo capacity in the new year and lay-up aircraft in a bid to counter an anticipated slowdown in demand.Traditional cuts in capacity after the Christmas peak will be extended, as LC anticipates “a first half with growth around zero, maybe slightly in the minus,” LC product and sales chief Andreas Otto said last night. “We would reduce capacity available to customers by 20, 25, maybe even 30%,” Otto said. A 25% capacity cut would be equivalent to grounding four aircraft, Otto said. However, added Otto, the second half of 2012 should be “smooth and successful”, producing overall growth of about 3% for the year. He said US Census Bureau data showed inventories were near record lows – evidence that cargo carriers would be the prime beneficiaries of any upturn in the economy, as retailers needed goods quickly to meet new demand. Lufthansa Cargo’s third-quarter earnings before interest, tax, depreciation and amortisation (ebitda) fell 51% to €58 million ($78.5 million). This compared with a record profit in 2010. Elsewhere, Lufthansa has given China’s Shenzhen Airlines until the end of the year to reach an agreement on more investment in their joint-venture, Jade Cargo, said Otto The unit needed investment to improve profit margins, and Lufthansa “doesn’t exclude any options should that not be forthcoming”, he added.
Link to IFW story 

Lufthansa shelves plan for new air cargo hub at Frankfurt

David Badger | Mon, 21 Nov 2011 Billion euro investment a casualty of night-flight ban, says carrier
Lufthansa Cargo, the freight arm of Germany’s largest airline, has shelved plans to invest around €1 billion (US$1.35 billion) at Frankfurt Airport, as a result of the night-flight ban there.“Lufthansa still wants to invest, but the size is dependent on the night flight regulations,” a spokesman said on Friday. The airline group had also planned a new logistics centre, as well as a new administration building. A court in Hesse has banned flights at Germany’s largest airport between 11pm and 5am, following an appeal by residents over the noise. Lufthansa Cargo said being forced to switch its night freighter services to airports other than Frankfurt could cost the carrier millions. The provisional ban is impacting LC’s winter schedule for 10 nightly Frankfurt flights. If the ban became permanent, it could cost the carrier somewhere in the “double-digit millions of euros,” LC CEO Karl Ulrich Garnadt said last month. Analysts have put the cost at between €30 and €50 million. The decision affects 30% of LC’s daily freighter departures from Frankfurt and means Lufthansa Cargo has been forced to restructure 80% of services, Garnadt said.
See also data on air freight recently in the UK:
2011  CAA’s UK airport statistics

Table 13 each month is Freight by type and Nature of Operator (freight for all UK reporting airports)

                                                                        (216,336  tonnes in Oct 2010)
September  2011 – 09         187,171 tonnes  (198,358  tonnes in Sept 2010)
August   2011 – 08              186,478  tonnes  (196 147  tonnes  in Aug 2010)
July    2011 – 07                   194,643 tonnes  (203,063   tonnes in July 2010)
June   2011 – 06                  194,864 tonnes  (199,824 tonnes in June 2010)
May   2011 – 05                   196,959 tonnes  (206,426  tonnes  in May 2010)
April   2011 – 04                  186,786 tonnes  (158,768 tonnes in April 2010)
March   2011 – 03                206,016 tonnes   (211,338 tonnes in March 2010)
February 2011 – 02             182,042 tonnes  (177,312 tonnes in Feb 2010)
January  2011 – 01              179,059 tonnes  (167,058 tonnes  in Jan 2010)
2010 – Annual                2,324,822 tonnes  (2,047,861 tonnes in 2009)


total air freight for years before for all UK reporting airports:
1992     1 238 397  tonnes
1993     1 376 313
1994     1 588 787
1995     1 703 493
1996     1 771 586
1997     1 942 721
1998     2 080 485    
1999     2 188 965
2000     2 311 279 2001     2 143 281 2002     2 193 255 2003     2 205 934 2004     2 368 601 2005     2 360 984 2006     2 314 547 2007     2 325 239 2008     2 282 153 2009     2 047 861 2010     2 324 822

Seventh successive monthly fall at HKIA

David Badger| Mon, 21 Nov 2011 Volumes at world’s busiest cargo airport in step with global downward trend.

Hong Kong International Airport (HKIA), the world’s busiest air cargo hub, recorded its seventh successive monthly decrease in volumes in October.Air cargo volumes totalled 342,000 tonnes, last month, down 8.2% year on year.

“HKIA’s cargo performance is consistent with the worldwide negative growth trend,” said CEO Stanley Hui.

In the first 10 months of 2011, the Hong Kong airport handled 3.3 million tonnes, down 4.4% on the same period last year.

Cathay Pacific, based at HKIA and the world’s largest cargo carrier, last week reported October cargo volumes down 17.5% this year, due to continuing weak demand in Hong Kong and China.


IAG Cargo cautiously optimistic after modest Q3 growth

Kizzi Nkwocha | Fri, 4 Nov 2011

Air freight carrier blames tough global trading conditions

The cargo arm of International Airlines Group, IAG Cargo, comprising of BA World Cargo and Iberia Cargo, has reported a modest increase in Q3 results, “reflecting 2011’s challenging global trading conditions”.For the period from July to September, IAG Cargo recorded commercial revenue (flown revenue plus fuel surcharges) of €288 million (US$397m), just ahead of the €287 million in the same period last year.

However, the carrier’s year-to-date total was €880 million, an increase of 10.6% on 2010.

Q3 cargo capacity was up 3.3% and 6.2% for the year to date, a modest increase IAG Cargo said was a reflection of the tough trading conditions facing the global economy.

Volumes of almost 1.5 billion cargo tonne km (CTK) for the quarter represented an increase of 1.2% on Q3 last year, with the year-to-date figure of 4.56 billion CTK up 5.3% on 2010.

IAG Cargo MD Steve Gunning said: “Against a backdrop of robust results for the first half of 2011, the results for the third quarter reflect the challenging conditions facing the world economy.

“The contraction in demand for Asian exports – a result of the European debt crisis and the sluggish US economy – has meant only a modest growth in revenue.

“Because of this, we are cautious about future performance, although we believe our geographically diverse revenue base and measured capacity reintroduction leave us well positioned.”