One Middle Eastern carrier's ambitions are turning into another's execution, or at least it appears that way
s summer temperatures start to soar in the Arabian Gulf the searing desert heat can begin to play tricks on the mind. What seemed certain a short while ago, suddenly no longer seems so apparent. It is a little bit that way with the region's air carriers.
Gulf Air appeared to be on track for a revival in its fortunes following the appointment of James Hogan as its first non-Arab chief executive four years ago. Just over a year ago it revitalized its cargo product by bringing in British industry veteran Des Vertannes to head-up Gulf Air Cargo. Vertannes had most recently been chief executive officer of U.K. ground handler Air Menzies International, capping a career which started with British Airways Cargo, where, appropriately enough, he served a stint as cargo manager for the Arabian Gulf.
Hogan talked of doubling Gulf Air's fleet by 2010 and Vertannes quickly began to walk the same talk, discussing the possibility of converting some of the airline's 767-300s as they exited passenger service.
But suddenly all that has changed.
James Hogan has departed and moved a few hundred miles south down the Arabian Gulf to become chief executive of Etihad Airways, the emerging Abu Dhabi carrier. And lo and behold Des Vertannes has quickly followed in his footsteps to become executive vice president of Etihad Crystal Cargo.
All of which has left a huge void back at Gulf Air headquarters in Bahrain. A new CEO has quickly been ushered in with Andre Dose, one of the architects of the launch of SWISS, taking over at the helm. Dose obviously has a completely different take on the Gulf carrier, particularly when faced with the realization that even after four years under Hogan the airline is still hemorrhaging operating losses of one million dollars a day.
Dose has immediately cut loss-making services to Hong Kong, Jakarta, Singapore, Johannesburg, Sydney and Dublin. He has also cut a swathe through senior management. This included Ali Murtada, the vice president of business units, who effectively oversaw the airline's cargo business. Prior to the departure of both executives, Gulf Air Cargo had this year introduced a series of A300 freighter charters operating between Bahrain-Chennai-Bangalore-Amsterdam.
In contrast, at Etihad, Des Vertannes has joined an Arabian Gulf carrier very much on the way up, although one still punching above its weight in terms of global ambition and actual reality on the ground.
But all the signs are that a strategy is in place to realize its lofty ambitions. That includes the usual pre-requisite for any self-respecting emerging Arabian Gulf carrier - cash-on-the-table orders for the new Airbus A380s.
Crystal Clear
Happily for Vertannes, cargo has been given an early priority by the airline. At Etihad Crystal Cargo, he inherits a cargo business already operating its own fleet of three Airbus A300-600 freighters. The 44-tonne capacity equipment serves a regional collective of flights out of Abu Dhabi to Addis Ababa, Bangalore, Chennai, Khartoum, Kolkata, Mumbai and Delhi. The airline also operates the freighters into Europe to Frankfurt and Milan.
Just where Etihad goes from here in developing its freighter network is probably an early priority for its new cargo boss. The airline was mulling 777-200s or A330s as freighters. But any plans may be forestalled until a decision on expanding and developing cargo facilities at Abu Dhabi airport. About 200,000 tonnes of cargo were handled through the airport last year, with Etihad Crystal Cargo accounting for about 135,000 tonnes.
Doha's Round
Fellow Arabian Gulf newbie, Qatar Airways, also has ambitions which stretch way beyond the Arabian Gulf. Its current order book includes a clutch of A380s, but more notably, perhaps, no less than 20 777-200s, plus another 20 options.
But the start-up carrier is another which seems to fumble around when it comes to appointing senior executives and managers, no more so than with its cargo business, which has seen a string of managers come and go.
The latest to head to Doha is John Batten, who, perhaps in a flash of inspiration, but otherwise unconventionally, has been recruited from the express industry. Until his appointment as head of Qatar Airways Cargo in early April, Batten was managing director global network and air cargo sales for TNT, where he had worked for 25 years.
But his most recent role, placing him in charge of selling all surplus capacity on the TNT air network, may well have some relevance to his new challenge.
Qatar Airways Cargo has at least already made a decision regarding long-haul freighter equipment. It is acquiring two 777-200 long-range freighters, due for delivery in 2009, when the Qatari capital of Doha is due to open a massive new airport.
Qatar Airways Cargo already operates two A300-600 freighters on regional duties. They will be joined by a third aircraft of the same marque in August. Although new cargo routes are under consideration, the prime objective of the extra capacity is to improve lift for the existing freighter network, serving points such as Frankfurt, Madrid, Amsterdam, Nairobi and points in the Asian sub continent.
Besides, Qatar Airways Cargo will have enough problems keeping pace with the development of the airline's passenger route network in coming months. Daily service to Washington is to start in July, with, ahead of that, a four-times-weekly service to begin to New York in late June, the latter by way of Geneva.
If that sounds like a breakneck pace, consider what with the carriers are competing.
Dubai's Emirates airline, after all uplifted 1.2 million tonnes of cargo in the year through March this year, up by 13.5 percent. The airline has 18 freighters on orders, a mix of 747-8s and 777-300s. And 10 747-8s have been optioned just in case the current order book is not enough to sate Emirates SkyCargo's appetite.
… Briefly
Cargo traffic for European airlines edged up 0.8 percent in the first quarter, including a 0.1 percent slip in March, according to the Association of European Airlines. Asia-Pacific traffic fell 1.8 percent compared from last year. … Cargolux posted a $82.6 million net profit in 2006, up 6.5 percent from the year before, but the improvement included a gain from the sale of four aircraft. The operating profit was down 12.1 percent to $263.4 million despite a gain in revenue to $1.5 billion as expenses jumped 8.8 percent to $1.4 billion, and a total fuel bill of $581.5 million after hedging gains. … AMI, a wholly owned subsidiary of UK freight wholesaler Menzies Aviation, will acquire Los Angeles-based consolidator, Universal Air Cargo. New Zealander Peter Whitfield, chairman of UAC, said combining the two companies, which will be headquartered in London, would provide a "seamless global service" by consigning freight from wholesaler to wholesaler. … Beijiing-based freight-forwarder Link Global Logistics will buy the Northern Germany cargo airport Parchim for an undisclosed sum. Link intends to invest $27 million in the former Soviet air base near Schwerin, between Berlin and Hamburg. … Lufthansa Cargo is the first IOSA-registered freight airline worldwide. The IATA Operational Safety Audit Program was initiated in 2003 to enhance flight safety and has registered 144 airlines. … OAG Cargo opened a sales office in Ascot, England. ... Etihad Crystal Cargo switched its German freighter services from Frankfurt Airport to nearby Frankfurt-Hahn. … Chinese 747 freighter operator Great Wall Airlines started four-times-weekly service to Manchester, inbound through Amsterdam and outbound through Dubai and Shanghai. The airline named EuroGSA as its cargo general sales agent for the U.K. Service. … Silverjet, an all-business class airline based in the United Kingdom, will outsource its cargo ULD management to Unitpool. … India's Jet Airways, which flies A330s and A340s 27 times weekly into London, named IAM its cargo general sales agent in Dublin. … Royal Jordanian Cargo named Global Air Cargo as its general sales agent in Switzerland, where the airline operates three times weekly to Geneva and Zurich. … Britain's GB Airways named Air Logistics Group its exclusive cargo general sales agent for the European regional carrier's entire network. … BAE Systems Regional Aircraft named Bacau, Romania-based Aerostar the prime contractor for the re-launched BAe 146QT freighter conversion program. … Aban Air, an Iranian all-cargo airline operating an IL-76 freighter between Dubai and Tehran, named ANA Aviation its general sales agent for the United Kingdom and Ireland. … The new custom-built warehouse office complex at Northern Spain's Vitoria International Airport opened for business. … British Airways is buying four 777-200s extended-range aircraft, worth $800 million, to add to its fleet of 43. … MK Airlines started regularly scheduled cargo flights to Karagandy International Airport as part of the development strategy for the Republic of Kazakhstan. … Futura International Airways chose Spain's Vitoria International Airport as a cargo base for traffic between the Canary Islands and the European Union.