Peter Conway ZURICH
Independence is proving an issue for two European cargo operations as airline consolidation continues within the region.
For SAirLogistics, the diversified cargo company within the SAirGroup, the question is how it will be affected by the much publicised troubles of its parent company. There has even been speculation that SAirGroup will now seek to sell SAirLogistics.
The idea is not as crazy as it sounds. Since 1997, SAirLogistics has successfully - and profitably - diversified away from Swissair, whose belly space now accounts for less than half of its cargo capacity. Its management of Sabena cargo operations and a 33.7% stake in Luxembourg all-cargo carrier Cargolux make it the world's fifth largest air cargo grouping, says SAirLogistics chief executive Klaus Knappik. This is in contrast to the 23rd place Swissair occupies in the passenger rankings. SAirLogistics also has a substantial foothold in the the highly lucrative door-to-door logistics market through a 45% stake in SwissGlobalCargo - a joint venture with leading global forwarder, Panalpina.
This success might seem to make it a tempting target for a sell-off, but as Knappik points out, the diversified operations still depend on Swissair and Sabena traffic rights, something no third party purchaser could replicate. For example, SAirLogistics and Cargolux recently started a Zurich to Hong Kong freighter route using Swissair rights, and Knappik says he is keen to expand such co-operation.
Diversified or not, however, Knappik admits that SAirLogistics is still at the mercy of the wider SAirGroup strategy. A breakdown in the relationship with Sabena would be a particular blow, depriving SAirLogistics of 15% of its capacity, and particularly its high-yielding African routes. Knappik also concedes that if Swissair joined one of the major three airline alliances, SAirLogistics would be forced to fit in. Oneworld would be probably be the most attractive option. "We already have anti-trust immunity with American, and that has led to considerable cargo co-operation, and we are looking at joint cargo products," Knappik says.
Meanwhile, SAS announced in March that its cargo division was being turned into an independent company in April, although that was conditional on overcoming continued resistance from unions to the move. They see independence as the first step to the exact opposite - a takeover by Lufthansa Cargo, SAS's partner in the fledgling NewGlobalCargo alliance.
The two carriers have already brought their cargo sales teams under one roof in Europe, and in Scandinavia have appointed single country managers. SAS also revealed in March that it was in talks with Lufthansa Cargo about the latter taking a minority stake in SAS Cargo. Lufthansa Cargo confirmed the talks, but said they were at a very early stage.
Source: Airline Business
