Volga-Dnepr Group restructures in light of Covid-19

The Volga-Dnepr Group is restructuring the organisation of the business in order increase flexibility by streamlining processes and speed up decision making.

The changes mean that the airline group’s offices will have direct links to the points where decision are made by reducing the number of local vice presidents.

Meanwhile, sales offices will be unified to allow them to offer services across the group’s three airlines: Volga-Dnepr, AirBridgeCargo and Atran.

The new structure will result in the Volga-Dnepr Group of airlines becoming a “mono-company”, Volga-Dnepr said.

The Volga-Dnepr platform offers An-124 and IL-76s, AirBridgeCargo operates B747 and B777 freighters and Atran flies B737Fs.

The changes have seen Konstantin Vekshin promoted to chief commercial officer from executive president, charter cargo operations.

Meanwhile, Tatyana Arslanova, formerly executive president of AirBridgeCargo, now occupies the executive operating director position at the Volga-Dnepr Group.

And a new board of directors has been created (see end of article for the full line-up).

The company said that during a recent meeting, the new board of directors discussed the group’s performance and the most pressing issues for the past five months, including the relationship with creditors, suppliers and customers.

Chairman of the board and co-founder of the company Aleksey Isaikin said: “Facing the challenges that have led to fundamental changes and revision of the passenger and cargo services value from a biosecurity perspective, we have decided on the necessity for transformation.

“I am confident that a strong Board of Directors will help the executive team successfully transform and adapt business leaders to the Covid-reality environment.”

Meanwhile, Vekshin told Air Cargo News that in the current market it was important to be as flexible and responsive as possible.

“We are trying to bring our regions closer to the points where all those decisions are made on a daily basis so that our reaction time is expedited and we react to an ever changing situation.

“It isn’t that we were slow before, but now there is more transparency and there is more understanding

“It will be a simpler structure, more horizontal than vertical, meaning all those important decision will get to the regions much faster because it is a relatively short communication chain.”

He added: “By unifying our sales in the various regions, we are not only unifying our sales platforms, we are unifying our fleets, so that the different sales organisations are turning into one cargo supermarket.

“It means that at any time, no matter where it is in the world, we are offering the same types of services.”

Vekshin explained that the move means customers will be able to access part-charter, full-charter, per kilo, and even ACMI services through all the company’s offices.

“We have established various sales offices around the world and now we unifying them all. We have become a more mature organisation where we can position ourselves, no matter where we are, as one unit, one organisation with the same standards, with the same culture with the same attitude.”

He said that the various brands would remain in place, but their links to the overall Volga-Dnepr Group would be cultivated, especially as the company will be celebrating its thirtieth anniversary this year.

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Vekshin also provided an update on the current market. He said that while urgent demand for the transport of personal protective equipment had eased and bellyhold networks had started to get back underway, the demand for all-cargo charter operations remained because of the uncertainty around these operations.

“Our customers, essentially freight forwarders, are very practical folks,” he said. “They don’t want to take any chances; they need a reliable service, they need flexibility and they need predictability.

“If they operate a charter with us, they know they will get this much capacity, a dedicated schedule and everything will be delivered as promised.

“With passenger carriers we are talking about serious limitations as far as cargo, as far as flexibility, as far as payloads and of course the majority of our customers are all about a long-term planning.”

“They don’t want to let down their respective shippers and this is why again, there is a good balance in place right now and we are welcoming those long-term arrangements.

“No matter what is going on right now, everyone wants that stability and that stability can only be met by dedicated freighters.”

On other challenges faced by the market at present, Vekshin said that issues around airport congestion and crew quarantine had eased as companies had adjusted their operations, but there were still some problems in those areas.

Looking at the demand side of the picture, Vekshin said that the airline group is not expecting any major spikes in the months ahead and that volumes had plateaued as PPE requirements had subsided.

However, he said that e-commerce continues to boom, the pharma sector is also doing well and customers will continue to need the stability that freighter operations can bring.

The restructured board line-up includes:

• Alexey Isaikin – Chairman of the Board, the founder and co-owner of the Volga-Dnepr Group with over 40 years of experience in the aircraft and civil aviation industry.
• Sergey Shklyanik – Deputy Chairman, co-owner of the Volga-Dnepr Group, a recognised industry expert with more than 40 years of experience in the aviation industry.
• Tatiana Arslanova – Deputy Chairman, Executive Operating Director of Volga-Dnepr Group, who has held senior positions within the Group for over 15 years.
• Ruben Vardanyan – an independent Director, Russian business leader, social entrepreneur and philanthropist.
• Giorgio Callegari – an independent Director, a member of the Boards of Directors in Insurance Public Companies Ingosstrakh and Enel Russia, and a former member of the Boards of Directors of Alitalia and Aeroflot.
• Ella Sytnik – an independent Director and a partner of Ward Howell, specialising in organisational transformation and team development management.
• Stanislav Tillich – an independent Director and former Prime Minister of Saxony.

Three committees of the Board of Directors have been formed: Strategy and Transformation, Budget and Audit.

The last six months have been a turbulent time for the airline group. At the end of last year, the company faced a tough time as the US-China trade war took its toll on the air cargo industry and the company was forced to make many changes.

However, the rise in demand for charter services and sky high freight rates as a result of the coronavirus outbreak appear to have boosted the company.