IAG Cargo – Clear signs from London
The first (of twelve) A380s for British Airways was welcomed by a reception committee of 380 cabin crew members on 4 July. The new double deckers are part of a fleet rejuvenation scheme of the British-Spanish International Airlines Group, which took delivery of its first B787 a few days before. We spoke to David Shepherd, who is responsible for IAG Cargo’s global sales and marketing.
Mr Shepherd, during my last visit to IAG Cargo six months ago, managing director Steve Gunning spoke of a great uncertainty that was having a negative impact on airfreight business. What has happened so far this year?
I think that uncertainty is still affecting the entire industry and that market trends are similar to those in 2012. The enormous demand for passenger flights on the North Atlantic trade routes is giving us considerable cause for concern, as the belly capacities cannot be filled between Europe and North America.
IAG took a major step in Spain by taking over the Barcelona-based budget airline Vueling in spring. How does the British-Spanish airline IAG’s freight division benefit from that move?
The move expands our short and medium haul aircraft fleet, among other things, without particularly boosting the freight capacity. By the way, we had already been marketing Vueling’s modest freight capacities beforehand.
Current operative results are not so convincing – and that applies to IAG Cargo too. What do you want to do to reverse the trend?
We are collaborating closely with a large number of major forwarders who will ensure that the belly holds of aircraft are full. We are also attempting to establish a broad market basis in order to win new clients. For instance, we have prepared a stronger distribution offer, set up a simpler sales channel on our website and are currently making our far-flung network even better known. In short: we are speaking to more interested parties than ever before, and they include small and medium-sized forwarding companies.
The fleet rejuvenation programme that IAG has launched is a long-term project that will last until 2023. What are your short-term plans?
We are enlarging our network significantly and will fly to Chengdu in Central China for the first time in September. This will be followed by Seoul Incheon in December. The fleet refreshment project is very interesting for freight activities, particularly on long haul routes. Take our service to Hyderabad (India) for instance: the B787 with its substantial hold will replace the B767, whose use was rather limited for us. Hyderabad is an important pharmaceutical production site and gateway to eastern India’s industrial region. We would like to launch services to other interesting destinations in the Orient.
Last year there was talk of consultations with other larger airlines. How far have these progressed?
We are highly interested in collaborating with other air transport providers. We are of the opinion that the interline procedure has not really proved worthwhile, so we have developed our own concept called «Partner Plus» to gain the most out of a cooperation.
Is this partnership limited to OneWorld alliance members?
No, it is not restricted to them.
The world’s largest carrier, which will evolve from the merger of American Airlines and US Airways, has decided to become a member of OneWorld. How important is that?
We regard it as a promising sign that that US provider, as well as Latin America’s Latam and Qatar Airways, will become part of our alliance.