Capacity discipline is key priority for AF-KLM Cargo

With cargo load factors on the rise, yields improving and money flowing once again into the coffers of Air France-KLM Cargo, one would think the Champagne corks would be popping. But uncertainty still lingers heavy in the air as global economic signals are mixed and returning and new air craft capacity looms like a menacing cloud on the horizon. Donald Urquhart reports from Paris.

“Volatility in market will remain,” Michael Wisbrun, EVP for AF-KLM Cargo told reporters in Paris recently. “What we see and went through last year is more intense than what we ever had in the last 20-30 years.”

While things have clearly improved with the group expecting cargo revenues of about €250 billion this year -still down on normal years, but a dramatic improvement from record losses last year -the returns are still too thin, Wisbrun emphasises.

“We do stress that the market dynamics remain volatile and hectic -we cannot move forward more than one, or two, or three months because changes keep taking place, the behaviour of our customers, our shippers are rather fast changing.” The only way to cope is to prepare for a more and more uncertain world going forward, he says.

This uncertainty can be seen in the current peak season underway now. The Q3 peak season is not as strong as normal and the start of it came on later says Jean Charles Foucault, the group’s SVP for Sales & Distribution. “The present situation is less than anticipated and the earlier request for charters were quite high, but they are not there anymore, at least not at the same level,” he adds.