Cargolux in the Press

My Orchids. Phalaenopsis "You Name It". Photo ET

Cargolux in the Press

Cargoforwarder, a leading newsletter for the cargo business, carried a favorably disposed interview with Dirk Reich, CEO of Cargolux. There were the good news: Zhengzhou flights are full. The bad news are: return flights are almost empty. But that was to be anticipated from the beginning of the partnership.

The solution, it is said, is to include German airports on flights to Zhengzhou to increase German cargo at more competitive prices by reducing trucking costs, as 20% of freight comes from Germany. The vigilant employee organizations should listen to this: reducing trucking costs by getting closer to the German client shipping cargo to China. What about cargo shipped from China to German clients? How close has that airport to be?

We also get a progress report about the new joint-venture airline to be set up in Zhengzhou. It got a name, Cargolux China. The question no longer is if but when the JV will be operational.

On October 28^th, Cargolux corrected or explained the misleading misunderstandings and misquotes away:

Luxembourg, 28 October 2014 - Due to some misleading statements in the media, Cargolux would like to point out the following.
As foreseen in the cooperation agreement between Cargolux and its shareholder HNCA, a feasibility study for the set-up of a joint venture cargo airline, based in Zhengzhou, is currently undertaken. At this point, the airline does not exist; its set-up depends on the outcome and evaluation of the feasibility study that is expected to be finished next month. Only then will the Cargolux board and management decide on future actions.

In addition, Cargolux is studying the possibility of adding intermediate stops in Germany or other countries on its flights from Luxembourg to China, in order to optimize loads on these eastbound services. No flights from Luxembourg will be replaced by flights from Germany or other countries, all Cargolux China flights will continue to operate to and from Cargolux’s hub at Luxembourg Findel airport.

Unfortunately some more intrusive questions of the day were skipped. Such as:

• Despite the low load factors on return flights from Zhengzhou, are those flights profitable? We know they were not meant to be profitable, and a $15 million fund was set aside to subsidize the operation. Another newsletter, the LoadStar poses similar questions.  
• Cargolux had some unwelcome publicity from the wing wave incident involving President Operations Captain Marcel Funk, Vice President Operations Captain Wieger Ketelapper, and First Officer Benedikt Stock. Though this is not a strategic issue, it is of interest to see how the new CEO is handling obvious risky behavior. During the wing wave, bank angles were probably exceeding 30 degrees and very close to the ground. It was obviously a very broad interpretation of the Cargolux Spirit, all the more when a manager is at the commands, and there were previous incidents. Good news here are that the FAA seems to ignore this incident, and that CEO Reich seems to have enforced a strict application of the “Just Culture” concept.

Which brings us to the two other good news of the month: Cargolux is not a private company anymore, and will fly to Tokyo in the near future!?

Reversing former affirmations that Cargolux is a private company, Minister Bausch traveled to the International Air Cargo Forum and Exhibition 2014 in Korea in support of the company, and mostly to Japan to sell the idea of a direct Cargolux connection to Tokyo. Nice trip. He made it to the Japanese Vice-Minister of Transportation, probably a career civil servant,  who promised he would analyze the question. Our man understood that we made progress, a good step forward. Translation for Mr. Bausch: that means NO! It only can’t be said that way in Japanese diplomatic culture.

Which reminds me of an anecdote: In 1984 a delegation presided by then Crown Prince Henri and led by then Secretary of State Paul Helminger traveled to Japan. Nice trip too. In Mr. Helminger’s bags were two “Grand Officier de l’Ordre du Mérite”, that were bestowed upon two Japanese Senators for their invaluable help in securing landing rights for Cargolux in Tokyo. The ceremony went well until one of the Senators in his speech expressed his deepest thanks for the high Luxembourg distinction, and also his regrets that the announced landing rights unfortunately could not be confirmed. CV was offered Fukuoka as a destination instead, as a positive refusal. So good that almost 30 years later the government as a majority shareholder through Mr. Bausch forced a breakthrough.