Thai Cargo: Freighters Out, Profits Up

The Bangkok-based freight carrier phased out its two P2C converted Boeing 747-400Fs in March of 2015. Since then, all consignments are flown in the lower deck compartments of the passenger fleet. The result of the anti-freighter decision is staggering.

Norbert Rockenmeyer heads Thai Airways Cargo Germany  -  photo: hs
Norbert Rockenmeyer heads Thai Airways Cargo Germany - photo: hs

Getting rid of freighter operations paid off in many ways, says Thai Airways Cargo's Germany chief Norbert Rockenmeyer. The most visible and convincing result: "Ever since, our viability went up remarkably." A U-turn that led from margins under pressure, being converted into actual profitability.
Although he refrains from delivering exact financial figures, Norbert indicates that Thai's cargo division contributes around 13 percent in average to the airline's entire turnover, accomplished by only 4 percent of the company's total staff. In other words: The high productivity of the freight division and its remarkable contribution to the carrier's general revenue is a key element for the overall success of the Thai Airways Group.
 
Direct capacity access
To secure forwarding agents the uplift of their consignments as originally booked, Thai Cargo purchased the entire lower deck capacity of the carrier’s fleet from the passenger unit, a deal based on specific keys. “This way, we have direct access to the cargo compartments of each of our aircraft,” Rockenmeyer states.
In addition to the freight division’s high productivity, the manager points out three key issues that Thai Cargo’s latest turnaround is based on:

  • the implementation of its electronic and easy to use booking tool ‘Chorus’,
  • a uniform fleet of 81 wide body aircraft offering ample cargo space in their holds,
  • and extremely fast transit of consignments at its home base Bangkok Suvarnabhumi International (BKK) for pre-built and mixed loaded shipments.

Transits dominate
Astonishingly, only about 15 percent of the imports flown into BKK remain there, while 85 percent of the goods are transited to ongoing flights heading to destinations in Southeast Asia, the Far East, Australia and New Zealand. Transferring built-up ULDs to a connecting flight at BKK needs no more than two hours, Herr Rockenmeyer assures. Therefore, despite the consignment’s short Bangkok reloading, “we offer our cargo clients an A level service,” he says.
Although Thai Cargo demands rates that are slightly above average market levels, most clients stick to the carrier. As surveys have shown, this they do mainly due to the first class service offered by the airline, which the “smooth operational performance at our Bangkok hub” is essential part of, Rockenmeyer pronounces. Responsible for the latter are Thai Airways’ ground handling services that not only take care of the imports and exports flown on board Thai’s own fleet but serve some 60-plus airlines that transport cargo in and out BKK.

Thai’s newest flagship A350-900 will serve BKK-FRA beginning in May  -  company courtesy
Thai’s newest flagship A350-900 will serve BKK-FRA beginning in May - company courtesy

High load factor
In Europe, Thai Airways operates into and out of Copenhagen, Oslo, Stockholm, Moscow, Brussels, London, Paris, Zurich, Milan, Rom, Munich and Frankfurt, most of them enjoying daily services. At Rhine-Main, they operate 14 flights per week with 11 heading straight to Bangkok and 3 to Phuket, before continuing to BKK, while MUC-BKK is served daily.
The average load factor is very high, assures manager Rockenmeyer. “Even the Phuket flights are filled up with BUPs, although there isn’t any local freight demand but the consignments stay on board for traveling onto Bangkok right after the passengers have left the Triple Seven at Phuket and the aircraft takes off to its final destination BKK.” While Thai Cargo reports exports in the range of 3,500 tons in MUC, FRA accounts for roughly 10,000 tons per year. 
 
Local staff manage claims & customer service matters
Should a shipment eventually be affected by some sort of an irregularity, which shouldn’t happen but can never be excluded, Norbert points out that sporadic irregularities, such as claims are not managed by Thai Cargo’s headquarters but primarily on the local level, in his case by his 12 member Frankfurt team. Customers tend to appreciate this type of personalized service due to the direct point of contact, enabling rapid exchange of information and presenting solutions.
He further emphasizes that thanks to the IT system ‘Chorus’, booking shipments beyond Bangkok, destined to other final destinations has become an easy and very reliable task that is being rewarded by the cargo agents with loyalty and appreciation, as their ongoing commitment confirms.

Heiner Siegmund

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