During fiscal 2020/21, Qatar Airways Cargo (QR) defended its rank as the world’s number one cargo carrier by volumes, and substantially grew its market share as result of high-capacity demand, favorable rates, and its proactive fleet policy. However, despite record sales, the freight unit could not compensate for the carrier’s overall net loss. However, in spite of the sharp shortfall in revenues, the management is not alarmed because, in addition to its thriving cargo business, demand for passenger traffic is picking up again, reducing the airline’s losses.
In fiscal 2020/21, Qatar Airways Group reported a net loss of QAR14.9 billion (U.S.$4.1 billion), of which QAR8.4 billion (U.S.$2.3 billion) is due to a one-time impairment charge related to the
grounding of the airline's Airbus A380 and A330 fleets, the carrier explains. Despite the losses, there are two factors that encourage QR’s management: Firstly, passenger demand is tentatively
rising again, after a period of sharp drops caused by the pandemic. This spurs cargo transports as well, as more capacity is offered the market due to the growing number of flights operated by
the airline. Secondly, the cargo business went through the roof in fiscal 2020/21, and has kept on doing so.
Doubling freight revenues
During the pandemic’s peak, QR Cargo more than tripled its daily services, operating a record 183 flights in one day during the month of May 2020. Cargo has also overseen a 4.6% rise in freight tons handled over the previous fiscal year (2019/20), with 2,727,986 tons (chargeable weight) handled in 2020/21. This increase in freight handled, as well as a significant increase in cargo yield, also saw the airline’s freight revenues more than double, the carrier states.
Commenting on the annual report, the management states that despite the incurred losses, the airline has rebuilt its network from a low of 33 destinations served at the height of the pandemic, to more than 140 destinations today. At the same time, it launched a network offensive, because whoever offers flights first has an edge over competitors who show up later. This is the strategy of the management, which considers high initial losses when adding new routes to the existing global network. Thanks to the network offensive, 9 new destinations are served. These are Abidjan, Côte d’Ivoire / Abuja, Nigeria / Accra, Ghana / Brisbane, Australia / Harare, Zimbabwe / Luanda, Angola / Lusaka, Zambia / San Francisco and Seattle, U.S.
At the same time, the QR Group forged new strategic partnerships with several major airlines, including American Airlines, Air Canada, Alaska Airlines, and China Southern Airlines. These new alliances, along with a deepened cooperation with several existing partners, further strengthened Qatar Airways’ connectivity, providing a range of increased travel options for passengers as well as capacity offers for cargo clients.
Reflecting on what has been the most challenging and extraordinary 12 months in the airline’s history, Qatar Airways Group Chief Executive, Akbar Al Baker, stated: “There are three words that I believe best describe Qatar Airways Group’s response in the past year – strength, resilience, and commitment. Strength to not shy away from taking a risk or avoiding difficult decisions, resilience in remaining focused and not allowing events to overcome us, and commitment by never reneging on our promises to customers, partners, and employees.”
It can be expected that the carrier’s recovery will continue, enabling QR Airways to present better financial figures in its next annual report.
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