LATAM Cargo Europe Facing a Tough Year

2016 will end up as a tough year
This is the basic message Guido Henke delivers when looking back at the past eight months and forward to the remainder of the year.

However, he and his team are not looking pessimistically into the future as far as LATAM Cargo is concerned.
Yes, he says, 2016 saw declines in cargo throughput and resulted in capacity reductions.
On the other hand, he sees a noticeable upward movement in demand for space and is convinced that the new portfolio which comes on line on 1st October and which offers three types of service along with eleven so called “care options,” will be a success and give LATAM’s clients a far better service.

The Brazilian market has not been good to LATAM and other carriers on the route due to the economic downfall along with political unrest.
Guido Henke hopes that with the new government in place that trade flows and important investments in the country will gradually give the business a boost.

Thinning out of all-cargo flights from the EU to Brazil
The situation dictated that LATAM Cargo had to reduce the number of B777F freighter flights from FRA from 6 down to 4 per week.
Too much capacity on the routes to Sao Paulo from carriers such as Lufthansa, Cargolux, Martinair and LATAM itself led to withdrawing around 30 percent of the freighters from the route.

Mr Henke, 57 years of age, and an Argentinian national has been active in airfreight for the past 37 years having started his career in airfreight in 1979 with Lufthansa Cargo, Buenos Aires.
He enjoyed a spell as a freight agent between 1989 and 1994 and was also GSA for Fast Air, which meanwhile does not exist anymore.
He moved to Lan Chile in 1994 and over to Frankfurt in 2003, those times still LAN Cargo, now LATAM Cargo when it was brought to life in 2012.
Since then he has been steering LATAM’s cargo development in Europe from his Frankfurt base.

Capacity cut has stabilized load factor on EU-Brazil flights
The present drop in cargo flows is worrying, but Guido has been through such events before.
He and Jorge Carretero realize there is much to be done to make up ground, but are sure that the market will react positively to LATAM’s new product portfolio.

LATAM is showing very good cargo loads on their daily passenger operation out of FRA.
Europe to Sao Paulo loads which were until recently 820 - 850 tons per week are now up to 950 - 980 tons.
The remaining four freighters, three from Frankfurt and one from Basle which caters for the Swiss pharmaceutical business, are running well, reaching an average of 90 ton loads per flight.

Three new services on offer
Express, Standard and Flex, these are the three new types of service which are coupled with even different care options ranging from Pharma, Secure, Hazmat etc.
The European team is confident that the Flex product will also eventually be in demand from shippers and agents as it tied to a certain time guarantee along with an attractive price reduction for the clients.
Guido Henke estimates that 15% - 20% of the cargo carried by LATAM out of Europe in the future will be from the Flex product.

It would be gratifying for LATAM’s cargo team if the freighter capacity were sometime soon be able to return to the once six weekly flights.

John Mc Donagh