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15. May 2017

Outgoing Unilode Chief Ludwig Bertsch Draws a Balance

CargoForwarder Global was given the exclusive opportunity to question Dr. Ludwig Bertsch on his upcoming move. This is what the Unilode manager said.

Ludwig Bertsch at full action during Air Cargo Europe  -  photos: Unilode
Ludwig Bertsch at full action during Air Cargo Europe - photos: Unilode

17 years is a long time to spend building and steering the ULD pooling concept. Can you highlight the development of the business over these years?
 
It was indeed 17 years ago when during my tenure as President and CEO of Swisscargo we made the decision to spin off our ULD department into a separate legal entity under the name of Globepool. This way we intended offering independent ULD management & pooling services for Swissair and its partner airlines. So actually, the idea to go into ULD pooling did not come from me but from a working group within Swisscargo. After the demise of Swissair, Globepool went into receivership as well but the management team did not give up and restarted the business under the name Unitpool.
Back in 2003, when I was with ground handler Swissport in charge of the global cargo business we bought into Unitpool and I was appointed Chairman of the Board until I left Swissport in 2006. I obviously knew the business well and was convinced of its tremendous potential; I managed to organize financial backing in 2007 and convinced Swissport to sell Unitpool in a so called „Private Equity Backed Management Buy Out” to us. This way I became co-owner and again Chairman of the Board.  

This happened at an extremely critical time with the financial crisis spreading globally. Weren’t you afraid of going out of business?

Indeed, as new owners with limited financial capacity we had to steer the company through this very challenging period. We managed and after things had stabilized, business started to grow again, especially after winning Cargolux as our first major freighter customer in 2008, followed by AirBridgeCargo shortly after. This gave us and the market much needed confidence.
When Brambles approached us in 2010 driven by their intent to establish an aviation container pooling business under the CHEP brand we saw this as a once-in-a- lifetime opportunity to bring our business under the roof of a financially very strong listed company. It was only then that I decided to move into an executive role and got really involved fulltime in the day to day business of the company. It was the support and financial backing of Brambles which allowed us to execute a very ambitious growth strategy which saw us adding the global MRO footprint and acquiring five companies with 30 locations in 11 countries. This really gave us the needed boost to become the global leader in ULD management and repair which we are today. I am still grateful for the support Brambles gave us to make our strategic vision become reality.

Why did they sell CHEP Aerospace Solutions?

Because their new management decided to sell several “non-core” business units, and we were one of them. I was very much involved in the sales process and with EQT Infrastructure we found a very committed and financially strong new owner who understands and supports our growth strategy.

Do you see the ULD pooling concept and outsourcing by carriers growing even further?

Despite the fact that the industry has grown significantly over the last 10 years or so I believe that we have the best days still ahead of us. Global ULD outsourcing is roughly a US$300 million p.a. market. Our competitors and we have a combined market share of around 25%. Not all airlines will decide to outsource, but we can expect the outsourced market to double over the next 5 years or so. After a relatively slow start in the early days, the speed of conversion to ULD outsourcing has increased significantly and I see no reason why this should slow down again. Airlines are always under cost pressure and as long as our value proposition delivers increased service levels at lower cost, I expect continued growth for the industry. Not to forget that Unilode has ULD and galley cart repairs as second business which has good growth potential as well.  

Unilode stand at Munich-held ACE
Unilode stand at Munich-held ACE

You pioneered the ULD concept by taking over Unitpool, then moved into CHEP Aerospace - and finally into the Unilode brand. How do you see the business today compared to the early days?

When we bought the business from Swissport in 2007 we had around €10 million turnover and 25 or so employees based in Zurich and at the operations center in Bangkok. Today, we are above €80 million turnover annually, have operations in 35 or so locations on all continents and employ close to 600 staff.
It’s a global organization now and while we had 5 or 6 pooling customers then it’s more than 40 now. Among them are some of the largest airlines in the world such as American, United, Cathay Pacific, LATAM, Singapore Airlines or Air France/KLM either for ULD management or for ULD/Galley cart repairs. Hence, the company has matured and the sometimes turbulent startup phase is over. This gives me confidence also given my age - I just turned 57 last Saturday – that it is the right moment to hand over responsibilities to a new CEO who has the right skill set to steer the company into the next phase of growth.
 
That was two days ago. Congrats!
What will you miss most once you step back?

I love the airline industry and its people and have made many friends over the years who I will miss; even so, I will try to remain connected. What I will also miss is the inspirational work environment and the many colleagues and great individuals I had the privilege to work with at Unilode. Finally, I always enjoyed the interaction with our customers, especially in the early days. They placed a lot of trust and confidence in our small organization, something I will always be grateful for. 

Will you continue to exercise any direct influence on the daily Unilode operations in your new Board of Directors role?

Certainly not, EQT has a very strict governance model, the role as a non-executive board member does not involve any operational or direct influence in the day-to-day operations. We have found with Benoit someone who is more than capable of running this business.

Can you give us any insight into your future plans?

Not really – let me quote one of the heroes of my youth, David Bowie, who when asked the same question replied, “I don't know where I'm going from here, but I promise it won't be boring.”

We wish both you and Benoit Dumont continued success for the future

Thank you, John and Heiner

John Mc Donagh  /  Heiner Siegmund

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