Air, Freight News

Pleasant surprise for Lufthansa Cargo

[ March 23, 2018   //   Chris ]

The recovery in the airfreight market took Lufthansa Cargo by surprise, along with the rest of the industry, said chief executive Peter Gerber. Presenting the German carrier’s annual results at a press conference on 22 March, he said that a loss of €50 million in 2016 had been turned around to a €242m profit in 2017, one of the biggest carrier’s transformations in its history.

However, Lufthansa Cargo had had to make painful decisions in order to cut costs, including redundancies (although the carrier was “cautiously” rehiring in operational roles again) and axing a scheme to build a new cargo hub at its main Frankfurt base, he said.

However, he said: “We were lucky in that we abolished capacity precisely when the crisis came along and restored it when the market came back. We really cut our costs and we now have a competitive cost base again.”

A mothballed MD-11 freighter aircraft had been put back into service, he said. Lufthansa Cargo was now “carefully watching the market” to see whether further freighters could be added, including replacement of its older MD-11 fleet with newer 777Fs.

Volume was up 6%, yield by 14% and revenues by 21%, while the increase in costs had been contained. Chief financial officer Martin Schmitt said that he would “sleep much better this year”.

Gerber pointed out, also, that Lufthansa was once again the world’s leading air cargo carrier in revenue terms, ahead of Emirates despite the latter carrier’s rather larger fleet of aircraft.

Tags: lufthansa