ANA and LH Cargo - the new Pact

The deal hasn’t been inked yet. But Lufthansa Cargo’s long-announced plans to join forces with passenger airlines for enhancing air freight transport options seem to have led to an initial result. Preferred strategic partner of the German cargo crane will be Japanese carrier All Nippon Airways. The pact could kick off more bilateral alliances based upon this model.

Japanese carrier All Nippon Airways will become LH Cargo’s new ally in air freight  /  source: DUS Airport
Japanese carrier All Nippon Airways will become LH Cargo’s new ally in air freight / source: DUS Airport

For over a year this issue had been a closely guarded secret: the name of the first passenger airline LH Cargo might pact with to enhance transport options and penetrate additional markets. Joining forces with a number of major providers of lower deck capacity was one of the favorite projects, emphasized repeatedly at meetings and conferences by the cargo carrier’s former helmsman Karl Ulrich Garnadt. But even when switching his workplace from Cargo to Lufthansa Passenger Airline four weeks ago he remained tight-lipped when being asked to deliver some hints. 

Now, however, Garnadt’s colleague Harry Hohmeister, Lufthansa Executive Board Member and Head of Logistics, lifted the veil: there are talks being held with ANA for joining forces in air freight, he said in a side note when speaking with news agency Bloomberg about the business perspective of Lufthansa Cargo and freighter fleet issues.

From LH Cargo’s point of view Japanese carrier ANA seems to be a perfect choice. Both Lufthansa and ANA belong to the Star Alliance, they closely cooperate on routes such as Frankfurt-Tokyo or Dusseldorf-Tokyo, and both are market leaders in their respective European and East Asian geographical environments. What makes ANA particularly attractive for LH Cargo is the fact that they operate their Boeing 767 freighter fleet predomantly on domestic routes and to destinations in APAC. Simultaneously ANA offers vast lower deck capacity on their passenger aircraft on transcontinental routes between Japan and Europe. Finally, ANA is operating a dense network covering each corner of their home market, including countless connections to the Asian-Pacific region. This guarantees many transit and feeding options.
Similar are the arguments from ANA’s viewpoint with LH Cargo ensuring a higher utilization of their holds, thus bolstering revenues.

How closely knit this upcoming capacity agreement will be and if trans-pacific trade lanes are part of the package remains to be seen. Details are expected to be revealed soon, but no later than sometime during this summer, as LH Cargo had always pointed out. 
Asked by CargoForwarder Global about the case an airline speaker refused delivering any comment. 

Close bilateral collaborations with a number of selected passenger airlines are a cornerstone of the carrier’s future program “Lufthansa Cargo 2020’ and a lever for cost reductions might be a by-product but are not the carrier’s prime goal, CargoForwarder Global heard. 
This is partially in contrast to Hohmeister’s Bloomberg interview in which he said that LH Cargo’s strategy to join forces with passenger airlines is a main tool to lower the carrier’s operational costs. For the same reason the freight carrier’s fleet consisting of fourteen MD-11Fs and four Boeing 777Fs will be carefully scrutinized, announced the manager. He demanded Lufthansa Cargo to quadruple its net profit until 2015 to enable parent Lufthansa to achieve the planned target of €2.65bn as an operating result. In fiscal 2013, LH Cargo posted an operating profit of €77m, thus €28m less than a year before.

Heiner Siegmund

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