No Merger For Lufthansa Swiss Cargo

     Lufthansa Cargo and Swiss WorldCargo will not become one entity but stay separated and maintain their different brand names as well as product portfolios.
     “There are a lot of important customers in Switzerland that are eager to hand over their shipments to a Swiss airline with the Swiss cross at their fleet,” stated Jean-Peter Jansen, head of Lufthansa Cargo, in a recent meeting with German forwarders in Frankfurt.
     “Our basic principle is not to touch the heritage of Swiss.”
     Jansen’s counterpart at Swiss Cargo, Oliver Evans, lauded that promise:
     “Retaining individuality means to accept different cultures by both partners to give customers the chance to make a choice.”
     At this point both carriers have opted to maintain separate management in which to pursue individual business strategies while maintaining their full financial autonomy.
     Therefore, LH and LX do not follow AFC/KLM Cargo model that has integrated most domestic and international activities, including staff, products and stations.
     “We are a niche player with no freighters in our fleet but only belly hold space.
     “Therefore, we want to further concentrate on niche markets and retain our leadership as provider of belly hold capacity,” said Evans.
     Looking at the big picture, Lufthansa Cargo plays a distinctly different role in the international airfreight arena.
     Jansen and Evans thinking is that Lufthansa and Swiss offering the market different business models will be able to foster deeper relationships with agents and shippers unique to each carrier.

However, flying separately does not exclude Lufthansa/Swiss collaboration in a number of fields.
One such playing ground is the European trucking network both Swiss and LH Cargo offer their clients. “We are going to streamline the road feeder service, because parallel transports do not make much sense and furthermore, they are costly,” Mr. Jansen said.
Swiss WorldCargo wants to utilize the Lufthansa Cargo freighter fleet especially on routes to Far East.
“The Lufthansa cooperation offers us additional capacity together with a number of destinations we do not have in our network,” said Evans.
A third topic on the agenda of both carriers is the handling services at the airports served by the two carriers.
Wherever possible they want to use a common ground handling agent in future.
Taking their consolidated tonnage into account both partners are ranked second with 7.2% of the worldwide flown TKT.
Market leaders are AF/KL Cargo (7,9%) while Korean Cargo comes third (6,4%).
Due to the fierce competition and thin margins in the airfreight business both Evans and Jansen predict the ongoing consolidation of the cargo carriers.
Especially for the European capacity providers this is a “question of further survival” (Jansen), since carriers from Asia and the Middle East could surpass their European competitors in a couple of years due to the extraordinary economic growth in their home markets, political support and their aggressive price policy.
“We shouldn’t passively wait until that happens,” Jansen suggests.
Heiner Siegmund