Martinair Cargo 2006


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  • Martinair Cargo 2006

    1. 1. Martinair Cargo Presentation ACI Cargo Subcommittee Meeting April 2006
    2. 3. Profile <ul><li>Part of Martinair Holland NV </li></ul><ul><li>KLM and P & O Nedlloyd share 50% </li></ul><ul><li>1994 Cargo Sales separated from Passenger business, 2004 Business Unit Cargo </li></ul><ul><li>Cargo generates more than 63% of overall revenue </li></ul><ul><li>Ranked 14th on list of largest international airfreight carriers </li></ul><ul><li>Unique convertible concept </li></ul><ul><li>Tripled in size over the last 10 years. </li></ul>
    3. 4. Fleet
    4. 5. Fleet as per Winter 2004 Boeing 767 Airbus A320 Boeing 747F MD-11F
    5. 6. Martinair Organization Business Unit Cargo Business Unit Passenger Unit Operations Corporate Staff
    6. 7. BU Cargo Organization Sr. VP Cargo Cargo Planning & Control Cargo Sales Europe Asia Pacific The Americas Africa Industry Affairs Business Administration Strategic Development & Marketing
    7. 8. Cargo Sales Organization Cargo Sales Europe (AMS) Asia Pacific (HKG) Africa (NBO) The Americas (BCT) Industry Affairs (AMS) Benelux (AMS) Central Europe (FRA) Scandinavia (MMA) Southern Europe (CDG) UK & Ireland (LHR) North East Asia (HKG) South East Asia (BKK) Middle East (SHJ) South Pacific (SYD) North America (BCT) Latin America (BCT) C&RM C&RM C&RM Key Account Management Key Account Management
    8. 9. Online destinations Amsterdam Seattle Los Angeles Guatemala Lima Santiago San Jose Quito Buenos Aires Guadalajara Houston Miami Bogota Atlanta Chicago Harare Johannesburg Nairobi Kigali Muscat Hong Kong Bangkok Sydney Sharjah Entebbe San Juan Mexico Nanjing Doha Bahrain Tianjin Toronto Dallas Beirut
    9. 10. Hub concept Far East The Americas Hong Kong Miami Amsterdam Africa Nairobi Europe
    10. 11. Worldwide Facts <ul><li>470+ locations with Cargo activity: </li></ul><ul><ul><li>95 Sales offices </li></ul></ul><ul><ul><li>76 online destinations (incl. belly) </li></ul></ul><ul><ul><li>200+ trucking destinations </li></ul></ul><ul><ul><li>360+ interline destinations </li></ul></ul><ul><li>3712 Rotations per year </li></ul><ul><ul><li>1674 Freighters (24% APA, 27% AFR, 50% AME) </li></ul></ul><ul><ul><li>2038 Belly </li></ul></ul><ul><li>Load Factors 2004 (RTK-based): </li></ul><ul><ul><li>Average above 83% </li></ul></ul><ul><ul><li>Increase vs PY (0.7%) </li></ul></ul><ul><ul><li>Despite capacity increase of more than 9% </li></ul></ul>
    11. 12. European Facts <ul><li>34 European offices </li></ul><ul><li>1600+ freighter flights per year </li></ul><ul><li>Export trucking: </li></ul><ul><ul><li>75+ drop-points </li></ul></ul><ul><ul><li>6 regional consolidation hubs (LHR, MMA, FRA, CDG, MIL, BRU) </li></ul></ul><ul><li>Import trucking: </li></ul><ul><ul><li>100+ scheduled destinations </li></ul></ul>
    12. 13. Facts and Figures – ex-AMS 2005 <ul><li>Air Waybills 129.617 </li></ul><ul><ul><ul><li>> 70 % consol. > 6 % D.G. </li></ul></ul></ul><ul><ul><ul><li>Avg. weight 962 kg </li></ul></ul></ul><ul><li>Tons 122.855 </li></ul><ul><ul><ul><li>Pre-built : 13 % </li></ul></ul></ul><ul><li>Chargeable Tons 133.747 </li></ul><ul><ul><ul><li>Chargeable vs actual weight + 19 % </li></ul></ul></ul><ul><ul><ul><li>APA 28%, AFR 20%, AME 48%, Belly <4% </li></ul></ul></ul><ul><li>Pieces of cargo 1.606,500 </li></ul><ul><ul><ul><li>Fail rate < 1,0 % </li></ul></ul></ul><ul><li>Trucks 27.040 </li></ul><ul><ul><ul><li>> 70 % delivered between 18.00 and 05.00 hours </li></ul></ul></ul>
    13. 14. Facts and Figures – in-AMS 2005 <ul><li>Air Waybills 125.872 </li></ul><ul><ul><ul><li>Avg. weight 1353 kg </li></ul></ul></ul><ul><li>Tons 170.283 </li></ul><ul><ul><ul><li>In-transit beyond AMS about 30% </li></ul></ul></ul><ul><li>Chargeable Tons 184.453 </li></ul><ul><ul><ul><li>Chargeable vs actual weight + 8 % </li></ul></ul></ul><ul><ul><ul><li>APA 29%, AFR 25%, AME 43%, Belly <3% </li></ul></ul></ul><ul><li>Pieces of cargo 8.619.069 </li></ul><ul><ul><ul><li>Avg. pieces per shipment > 68 (flowers!) </li></ul></ul></ul><ul><li>Trucks 8.320 </li></ul><ul><ul><ul><li>> 70 % delivered between 18.00 and 05.00 hours </li></ul></ul></ul>
    14. 15. Key-Competencies (external) <ul><li>Perishable traffic </li></ul><ul><li>Dangerous goods </li></ul><ul><li>Oversized/outside dimensions </li></ul><ul><li>Animal traffic </li></ul><ul><li>Pharma </li></ul><ul><li>(part) Charters, special projects </li></ul><ul><li>Customer specific solutions </li></ul>
    15. 16. If only Cargo would buy return trips… Overcapacity Capacity shortage Overcapacity
    16. 17. Positioning Martinair <ul><li>Wholesale capacity product offered to forwarders (and shippers) via MP sales channel </li></ul><ul><li>Integrated (retail) product offered with partners, managed through key account program </li></ul>Shippers Freight Forwarders Airlines Freight Forwarders Integrated Airfreight Product Airfreight Capacity Consignees Capacity Partner-integrated product
    17. 18. Mission/Vision <ul><li>We provide our business partners worldwide cargo services, to the benefit of all stake holders. </li></ul><ul><li>We want to be viewed as an independent, professional and preferred airline. </li></ul><ul><li>We strive for operational excellence by continuously improving our business processes. </li></ul><ul><li>We need to be the most efficient competitor in our markets. </li></ul>
    18. 19. Martinair Cargo Strategy <ul><li>Sustained growth: </li></ul><ul><ul><li>To remain a serious player in the industry by: </li></ul></ul><ul><ul><li>reducing seasonal fluctuation in capacity, </li></ul></ul><ul><ul><li>expanding the network, first frequencies, then destinations, </li></ul></ul><ul><ul><li>leveraging specific areas of expertise (e.g., perishables), </li></ul></ul><ul><ul><li>and an increased customer intimacy by being a forwarder's preferred airline, focusing on key accounts. </li></ul></ul><ul><li>Based on a foundation of &quot;Operational Excellence&quot;: </li></ul><ul><ul><li>An improved quality/consistency and efficiency of: </li></ul></ul><ul><ul><li>Cargo business processes (e.g., efficiency, benchmarked performance) </li></ul></ul><ul><ul><li>the Cargo organization (e.g., skills/training, responsibilities, accountability) </li></ul></ul><ul><ul><li>ICT capabilities (e.g., information and electronic communication systems) </li></ul></ul>
    19. 20. Production Forecast (unconstrained) Sanity-check: Ambitious, but not unrealistic CAGR = Compound Average Growth Rate MergeGlobal: 5.8% MP: 7.3%
    20. 21. Strategic Initiatives <ul><li>Increase Cargo Capacity: </li></ul><ul><ul><li>Preparation 747F replacement </li></ul></ul><ul><ul><li>General replacement and extension research </li></ul></ul><ul><li>Market Development: </li></ul><ul><ul><li>Up-to-date Business Plans per Continent </li></ul></ul><ul><ul><li>Specific action items for market & network development (new destinations) </li></ul></ul><ul><li>Professionalise Business Processes </li></ul><ul><ul><li>Key processes described by process owners </li></ul></ul><ul><ul><li>Procedures established as part of ELFIS Cargo system implementation </li></ul></ul><ul><li>Strengthen Cargo Organization </li></ul><ul><ul><li>Competencies and role descriptions available as draft. </li></ul></ul><ul><ul><li>Implementation of new MP organizational structure. </li></ul></ul><ul><li>Team-up with partners </li></ul><ul><ul><li>Currently several ongoing initiatives, like QT-partnership </li></ul></ul>
    21. 22. MP 747 cargo fleet <ul><li>Boeing 747-200/300 </li></ul><ul><li>PH-BUH Oct 1975 phase out 15 Dec 2006 </li></ul><ul><li>PH-MCE Feb 1987 phase out 18 Feb 2007 </li></ul><ul><li>PH-MCF Sep 1988 phase out 05 Nov 2007 </li></ul><ul><li>PH-MCN Oct 1991 phase out after Feb 2008 </li></ul><ul><li>Boeing 747-400 BCF </li></ul><ul><li>PH-MPP phase in 16 Nov 2006 </li></ul><ul><li>PH-MPQ phase in 14 Feb 2007 </li></ul><ul><li>PH-MPR phase in 29 Oct 2007 </li></ul><ul><li>PH-MPS phase in 27 Feb 2008 </li></ul>
    22. 23. Market information <ul><li>MIDDLE/FAR-EAST </li></ul><ul><li>Eastbound: relief goods, hard cargo, vegetables, cattle </li></ul><ul><li>Westbound: electronics, wearing apparel, consumer goods </li></ul><ul><li>AFRICA </li></ul><ul><li>Southbound: relief goods, hard cargo, machinery, car parts </li></ul><ul><li>Northbound: mainly perishables </li></ul><ul><li>USA/NORTH- and MIDDLE AMERICA </li></ul><ul><li>Westbound: hard cargo, livestock, cars </li></ul><ul><li>Eastbound: electronics, hard cargo, perishables </li></ul><ul><li>SOUTH AMERICA </li></ul><ul><li>Southbound: hard cargo, livestock, “half products” </li></ul><ul><li>Northbound: some “finished goods”, perishables </li></ul>
    23. 24. Aircraft type comparison <ul><li>AMS-shj-sin-SYD-HKG-bkk-shj-AMS. Carrying 93 tons eb and 100 tons wb 747-200 appears to be > 10 % more costly than a MD-11 with 80 tons both ways, but appears be be heavily VOLUME restricted </li></ul><ul><li>AMS-tip-nbo-JNB-HRE-NBO-ben-AMS. Carrying 92 tons sb and 95 tons nb 747-200 appears to be > 10 % more costly than a MD-11 with 80 ton both ways, but FREQUENTIE (peaks) is here more important than payload </li></ul>
    24. 25. Aircraft type comparison <ul><li>AMS-sju-SCL-LIM-BOG-sju-AMS carrying 71 tons sb and 72 tons nb 747-200 appears to be approx. 25 % more costly than a MD-11 with 67 tons sb and 69 tons nb, but payload difference is not that significant so clear choice: MD-11. </li></ul><ul><li>AMS-atl-MEX-LAX-atl-AMS carrying 76 tons wb and 87 tons eb 747-200 appears to be approx. 30 % more costly than a MD-11 with 69 tons wb and 78 tons eb, here same as above payload difference not that significant so clear choice: MD-11 </li></ul>
    25. 26. 747-400/747-200 freighter comparison <ul><li>Due to its volume the Boeing 747 is the most suitable aircraft to fly to and from the Asia-Pacific region. </li></ul><ul><li>A Boeing 747-400 BCF operates 12.6 % more economical (mainly fuel consumtion) than a Boeing 747-200. </li></ul><ul><li>Newer aircraft, newer engines, less crew, better aerodynamics: LESS COSTS </li></ul><ul><li>An ongoing development </li></ul>