Middle Eastern carriers expand worldwide
While a number of airlines are curbing capacity and cancelling routes, many Middle Eastern freight carriers are bucking the trend. Emirates SkyCargo, for instance, is in full-fledged expansion mode, Ram Menen, the carrier’s senior divisional vice president of cargo, asserts. “We just can’t get our hands on airplanes fast enough,” he says. He points to the United Arab Emirates-based carrier’s push into the Americas as a manifestation of this.
Since January, Emirates Skycargo has launched three routes to the continental U.S., the most recent of which is to Washington, D.C. This route, which complements the carrier’s new services to Dallas/Fort Worth International Airport and Seattle Tacoma International Airport, is propelled by the 113-percent, year-over-year, increase in UAE exports to the U.S. in 2011.
“The U.S. is a big market for us,” Menen says. He says the new routes have been so profitable, in fact, that Emirates SkyCargo is looking to increase capacity on each of them.
Europe and Latin America are also on the carrier’s radar, Menen says. After commencing service to Madrid in 2011, Emirates SkyCargo immediately launched a second freighter to the Spanish city. Heightened demand similarly led the carrier to institute nonstop service to Lisbon in July, a move that came only six days after Emirates SkyCargo launched flights to Barcelona.
Menen cites the carrier’s new services to Rio de Janeiro and Sao Paulo, Brazil, as showing immense growth potential, as well. Basically, Menen says, Emirates SkyCargo isn’t looking to expand in one particular region — it’s targeting the entire world. “You can connect the dots,” he says, laughing.
Saudi Cargo is on a similar growth trajectory, according to Peter Scholten, the airline’s vice president, commercial. On March 25, the carrier instituted twice-weekly freight service to Saigon, with routings to Vienna and Frankfurt commencing on the same day. Scholten maintains that the latter destinations are particularly key to Saudi Cargo’s growth strategy. “Frankfurt is the financial and transportation center of Germany — the largest and most important market in the European Union — while Vienna is the gateway to Eastern Europe,” he says.
And, Europe, Scholten says, is Saudi Cargo’s biggest growth market. Despite the financial turmoil in the eurozone and the havoc it’s wreaking on worldwide trade, the carrier has doubled its business in Europe this year. “Basically, we took back business to places we should have been flying to before,” Scholten says.
Saudi Cargo is also thriving in African markets, he asserts. Together with its interline partners, Saudi Cargo now serves the West African cities of Abidjan, Accra, Cotonou, Douala, Libreville, Lome, Malabo, Niamey and Ouagadougou from its Lagos, Nigeria hub. The carrier also introduced a second freighter on its weekly route to N’Djamena, Chad, in May, due to increased customer demand. Scholten acknowledges that these destinations aren’t traditional hotspots for cargo, but says they’re critical routes for Saudi Cargo.
“I think it’s the mixed markets that we service where we are able to generate growth, compared to the other airlines,” he says. The carrier’s 26-percent, year-
over-year, increase in cargo activity from January to June backs up Scholten’s assessment. Saudi Cargo also recorded a 25-percent, year-over-year, surge in airfreight revenue during the first six months of 2012, with May and June breaking decades-long records.
“Look at us; look at our neighbors,” Scholten says. “The big four airlines in the Middle East — Qatar, Emirates, Etihad and Saudi — we’re all on a growth spurt.”
Recent International Air Transport Association statistics add fuel to his argument. While carriers in other regions saw cargo demand plunge by as much as 14 percent, year-over-year, in the first eight months of 2012, Middle Eastern airlines recorded double-digit cargo growth in every month but January.