Airlines will have to focus on yield

The South African airfreight industry, like its global counterparts, faces a tough few years ahead due to the world economic crisis. According to Gerd von Mansberg, owner of The Cargo Connection, airlines are in survival mode due to the current economic climate and it is crunch time. “The immediate future means making a choice – are you flying for revenue or are you flying for yield? And my suggestion in recessionary times would be to fly for revenue.” Referring to belly carriers, Von Mansberg said the airplanes were flying to schedules anyway and having cargo on board would add to revenue. “There is not much airlines can do right now but find ways and means to survive this cycle. In the short term we will see aircraft being parked off to eliminate excess capacity.” But, said Von Mansberg, he believes the worst is yet to come. “The airfreight industry is far more vulnerable than seafreight. We have recently heard that supermarkets across the UK are not willing to pay the premium for air freight and all grapes this year will be transported by sea and not air as was the case previously.” Von Mansberg said as air cargo was mainly for luxury items and highly perishable goods, the economic times are seeing this product cut from shopping lists first. “We are not transporting basic commodities and while everyone is saying the rand is weaker, exports should now boom, that is only true if you have buyers and America has gone into saving mode.” According to Von Mansberg, who attended a summit in Kuala Lumpur in Malaysia recently, industry leaders are of the opinion this year will see no season for airfreight. “October to March is the peak time for cargo, and as retail has declined the experts are saying there is no season this year. Strategic planning and good business practice is now the order of the day to survive the next few years where we also expect to see retrenchments across the industry.”