IAG Cargo has taken delivery of the first of three Boeing 747-8Fs. The freighter, flown on behalf of British Airways World Cargo, represents a bright spot for the airline group, which contended with less-than-stellar freight volumes in the third quarter.
IAG acquired the first 747-8 through a five-year wet lease with Atlas Air affiliate Global Supply Systems Ltd. This aircraft, in addition to the two remaining freighters, will be used to replace IAG’s current 747-400 fleet, an IAG spokesman said. It also marks the first new freighter in 11 years to bear BA World Cargo’s logo.
The freighters will complement BA’s existing routes to Frankfurt Airport, Hong Kong International Airport, Shanghai Pudong International Airport, Indira Gandhi International Airport and other key airports.
“In addition to the extended global network offered through IAG Cargo, our freighters will provide customers with increased capacity and, for the first time, freighter routes to Nairobi and Johannesburg,” Steve Gunning, managing director of IAG Cargo, said in a statement. “We remain committed to our long-term freighter partnership with GSS and Atlas Air.”
The company is also committed to geographic diversification, IAG Cargo Global Head of Sales David Shepherd told Air Cargo World. In addition to operating roughly 40 flights per day to North America, IAG is also targeting Latin America, India and the Asia-Pacific for growth, Shepherd revealed. “We’re a massively regionally diversified business,” he said.
It’s a good thing, indeed, as IAG officials reported modest third-quarter earnings. Although commercial revenue surged €1 million, year-over-year, IAG couldn’t sustain the gains it posted in the first half of 2011. To Gunning, it’s a phenomenon that has affected cargo carriers worldwide.
“The results for the third quarter reflect the challenging conditions facing the world economy,” Gunning stated. “The contraction in demand for Asian exports, a result of the European debt crisis and the sluggish U.S. economy, has meant only a modest growth in revenue compared to the same period in 2010.”
What’s more, overall yield actually shrunk in the third quarter, decreasing 0.8 percent, year-over-year. This number contrasts greatly with IAG Cargo’s year-to-date statistics, which showed overall yield climbing 4.9 percent from the first nine months of 2010.
Either way, Gunning said the global economy is affecting freight operations. “Because of this, we are cautious about future performance, although we believe our geographically diverse revenue base and measured capacity reintroduction leave us well positioned,” he stated.
The new freighters will also help IAG offset potential losses, Gunning maintained. In addition to “bolstering existing resilient trade lanes,” the 747-8Fs will establish dedicated freight routes for the carrier’s global customers, which will “offer increased flexibility and continued quality service,” he projected.