Air France 2013 Annual Report Download - page 38

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The cargo business is pursuing its in-depth
reorganization to return to profitability. The
Air France-KLM Group’s second business in terms
of revenues (€2.82 billion), the cargo business is
currently facing multiple structural challenges: global
capacity, which is already higher than demand,
has not stopped growing in recent years while
the air freight industry remains a niche market and
concerns mainly certain high-value-added goods.
Pooling resources
Air freight is an activity necessary to the economics
of long-haul and Air France-KLM Cargo has
embarked on an overhaul of its business model
to strengthen its position in this highly competitive
market. In 2013, one of the most important levers
involved combining the capacity and revenue
management of the Group’s operators – Air France,
KLM and Martinair. Thanks to common reservation
tools, the commercial teams will be able to optimize
the allocation of merchandise in the holds of all of
the Group’s aircraft.
Optimization, high added-value and profitability
To be more flexible and reduce its unit costs, the
Group is also taking advantage of its vast global
network by prioritizing the capacity offered by the
bellies of passenger aircraft which now carry 80%
of total cargo. This capacity is supplemented by
the full freighters which support the Group’s
renowned expertise for its ability to handle atypical
types of merchandise and enable access to
additional destinations.
The Group is also aiming to increase revenues
by developing high-added-value forms of air freight
such as express cargo and the postal service which
are seeing rapid growth with e-commerce and
the pharmaceutical and aerospace sectors. The
cost-saving efforts are continuing with the retirement,
in early 2015, of the two Boeing 747 Cargo aircraft
in the Air France fleet, ensuring 10% of activity and
totaling 30% of losses.
More partnerships
To consolidate its global presence, Air France-KLM
has also decided to play the partnership card. As
with passenger transportation, agreements with
other airlines enable the optimization of resources
and economies of scale. In 2013, the Group thus
extended its cooperation with Delta on the trans-
Atlantic routes and generated substantial technical
and commercial synergies
CARGO: HOLDS
FULL OF IDEAS
Devopg the Grp’s
know-how and experse
HOLDS FULL OF IDEAS
AIR FRANCE-KLM ANNUAL REPORT 2013
Cargo strengths:
The bellies of passenger aircraft
carrying 80% of the Group’s cargo
255 destinations, some served only
by the full freighters
A portfolio of large customers
The expertise and professionalism
of the teams