Carriers to impose dramatic rates rises

03 / 10 / 2013

  • Dr Andreas Otto, board director of Lufthansa Cargo

    Dr Andreas Otto, board director of Lufthansa Cargo

ADMITTING that the last year was “very demanding for the entire airfreight industry”, Lufthansa Cargo is to increase cargo rates by an average of 20 per cent from this winter.

The constant downwards pressure on yields has meant that prices are now below the cost of operation, reveals board director Dr Andreas Otto.

Although carriers cannot openly discuss pricing issues – for fear of transgressing anti-competition laws – a number of others are known to be reviewing their pricing strategies.

Yields have been under attack for up to three years now – and airlines desperately need to boost cargo revenues if they are to continue investing in their products.

In a letter to freight forwarders, the German carrier notes that IATA is predicting only marginal profits for the airline industry – with a lower-than-average performance in Europe.

“The airfreight market is especially affected as former growth markets, like China, show continuous weakness,” says Otto.

Read Nigel Tomkin's full interview in the next edition of Air Cargo News  7 October  – Issue 762.

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