Passengers follow cargo…

… states Ashwin Bhat, Head of Zurich-based Swiss WorldCargo. But it will take some time before previous levels of travelers return; how long this might last is a million-dollar question. Thus, the burden of earning money at this moment lies partially on the shoulders of the freight division of Swiss International Air Lines. And this will remain for some time to come.

This statement surprises: “We don’t lose money, basically each of our flights is commercially viable,” states the cargo helmsman in an online conference with CargoForwarder Global. “Fact is that the cargo business covers the variable costs of our intercontinental flights,” he proudly says, adding that with limited numbers of travelers boarding a long-haul flight operated by SWISS the airline’s major revenue source is gone. “Because of Covid-19 we have to accept the situation, but we are combatting it as best as we can.”

SWISS puts ‘preighters’ up front
This, Swiss WorldCargo obviously does quite successfully. On behalf of the freight division a larger portion of the long-haul fleet of Boeing 777s, A340s and A330s – is currently utilized for transporting cargo shipments. Most continue carrying a mix of passengers and belly cargo, but some, such as three of the Boeing 777-300ERs operate as “preighters.” Stripped of their seats, they transport cargo shipments. “On average, we currently conduct between 20 to 25 cargo-only flights per week, this way covering 85% of our pre corona serviced network, although less frequently,” explains Mr. Bhat. This has added up to nearly 1,000 cargo-only flights during the summer schedule, including those that still are to come until October 31st.
This way core cargo routes can still be covered, linking Switzerland with Buenos Aires, Mumbai, Beijing, Shanghai, Delhi, Dubai, Shenzhen, Boston, Johannesburg, and other destinations. “Once you stop flying the market is gone and you lose relevance, making it extremely hard to recover,” Mr. Bhat knows by experience, since some competitors keep flying regardless of any financial considerations.   
In the meantime, SWISS’s passenger traffic has picked up tentatively, as illustrated by Shanghai that will be serviced twice a week later this month, deploying a passenger Triple Seven in addition to a cargo-only flight.

Quality Corridors make the difference
Touching the Covid-19 vaccines that are expected to be produced and distributed in Q1 or Q2 of next year, Mr. Bhat emphasizes that SWC is ready to cope with the challenge. He points at “Quality Corridors” established and fine-tuned in recent years, consisting of certified trade lanes that are supposed to ensure the highest quality standard for temperature-critical  shipments such as pharmaceuticals on a global scale and maintain the product’s integrity along the entire cold chain. Meanwhile, over 50 quality corridors have been created by SWC. “In regards to pharma and other temperature sensitive commodities we invested in infrastructure, knowhow and customer relationship in recent years, so we are all set for the Covid vaccines,” he assures, “including transporting and processing normal pharma shipments.” This could make the difference in the upcoming distribution of vaccines.

Air freight beats ocean freight
But at this point in time nobody knows when the first vaccines will be ready for dispatch, at what temperature they need to be transported and processed at warehouses and what packaging is required to protect them. A glance in the crystal ball only reveals that the serums will be coming and transported by air – sooner or later. This was confirmed by CEO Rolf Habben Jansen of shipping line Hapag-Lloyd in a recent webinar. Asked by CargoForwarder Global about his company’s expectations regarding the upcoming distribution of Covid-19 vaccines, he said that this will predominantly be a task of cargo carriers, not ocean freight operators.

Heiner Siegmund

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