Air France 2007 Annual Report Download - page 35

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33
2006-07
Increased responsiveness
The integration of the cargo activities enables the two
companies to react rapidly to changes in the economic
environment.
Thus, within a highly-competitive context, Air France-KLM
Cargo has adapted its fleet by reassigning one Boeing
B747-400 FR in the KLM Cargo development plan
to Air France Cargo for the period between February 2007
and October 2008. This operation, decided in just a few
weeks, enabled Air France Cargo to bring forward the
withdrawal from its fleet of a Boeing B747-200 FR, which
was very high in fuel consumption, and to replace it with a
higher-performance aircraft. It also enabled KLM Cargo to
adjust its capacity to current demand.
Air France Cargo has also decided to accelerate
the replacement of its fleet of five Boeing B747-400 FR
aircraft with Boeing B777 FRs. These new, more energy-
efficient aircraft, will reduce gas emissions including CO2.
The outlook for cargo transportation
For the past two years, growth in air freight has lagged
that of world trade due to competition from sea
transportation, the concentration of the integrators
and exchange imbalances between Asia and Europe.
However, the growth of developing countries
and increasing globalization means that the outlook
for this activity is promising.
Global traffic should increase by 5.2% annually through to
2011 to reach 111.9 million tons, driven by the
globalization of world trade and “just-in-time” business
practice. Asia, and particularly China, remain
the most dynamic markets.
To anticipate these trends, Air France-KLM Cargo started
discussions with Chinese company China Southern in
early 2007, with a view to setting up a cargo joint venture.
These negotiations are aimed at creating a new company
under Chinese law which will operate is own fleet and will
have the exclusive right to market the holds of China
Southern’s passenger aircraft.
This potential joint cargo activity will support the Group’s
growth on the Europe-Asia routes but also within the
Asian and trans-Pacific regions.
*Source: Roland Berger ACT Worldwide and Regional forecast 2005-2010