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What is your assessment of the current concern of over capacity and what do you think will be the impact of supply-demand equation on profitability of air cargo industry? Going through the economical cycles, you will always have the good times and the bad times. The question is what you do during the bad times when the demand slows down. You have excess capacity. And then what do you do during good times when the demand is strong and you readily have that capacity available. You are then able to leverage that. That is why we are focusing on products and ensuring that our investments are there. We actually are able to provide solutions to different verticals. We are closer to the customers and understand their requirement and be able to align some of our products to their requirements. These are things that help you in the downturn of the economy. We have seen a decline in China and in different parts of the world. Despite the decline in overall volume, on Emirates, we have actually seen an increase in tonnage. Year on year we have grown almost by 6 percent which is incredible during these difficult times. It clearly shows the fact that if we are able to work with the customers and understand their needs and be able to address their issues with right solutions you still be able to sustain the business even during difficult times. I think that is what we have done to weather this difficult condition and be able to overcome the challenge. No doubt, yield has been impacted simply because there is excess capacity. But I honestly believe that customers want the security and safety of their cargo. They want on time delivery and that is why they are choosing the mode of air freight transportation. More important is the transparency of the whole supply chain journey that we are able to offer to our customers that has a value and the customer seems to understand it and they are willing to pay for it.
There is a consistent decline in the air cargo growth numbers despite low oil price. Middle Eastern carriers continue to perform better than others.
It clearly shows the fact that if we are able to work with the customers and understand their needs and be able to address their issues with right solutions you will wstill be able to sustain the business even during difficult times.
What according to you is aiding such performance numbers? hope we continue to perform well. This
I isn’ t just about the carrier. Dubai is a dynamic city. Take the example of the pharma facility we have just launched. Dubai is already positioned as a major healthcare centre in the region. Major pharmaceutical manufacturers are basing themselves in Dubai. Because they see Dubai as an ideal distribution centre for them to be here and make use of the vast Emirates network – 150 destinations, multiple frequencies to lot of cities, substantial capacity that gets offered with 777. With all of these known facts it is quite common for any business to take advantage of this huge massive network where you have access to every single market in the world with the shortest elapsed time. Pharma companies based in Dubai obviously require the infrastructure, and one of the key integral parts of that infrastructure is the capability of transportation and if you are able to provide that, it is a no brainer. It just makes perfect sense. A part of our success is because of the initiatives taken by the government itself on different industry verticals. That really helps us.
Emirates SkyCargo contributed 14 percent to the airline’ s total transport
revenue in 2015-16. With substantial investment in creating and enhancing facilities and products, what’ s the target you have set for SkyCargo in terms of volume and revenue growth? Of course we have a target, we have clearly defined objectives and strategies, part of which is ensuring that our products are strong enough. We make sure our positioning is always strong in every single market we operate. That to me is an ongoing day to day activity. So far, looking at the global decline in tonnage versus our growth it clearly demonstrates that we are able to still project our market share perhaps with much better yield that other competitors. That tells the story.
Innovation and investments drive Emirates SkyCargo’ s success. What are some of the specific initiatives to offer better cargo service to your customers? Are they in creating new products( perhaps to tap into the cross border e-commerce logistics), enhancing current product range or in investment in facilities? We all recognise that the retail world out there is changing dramatically. E-commerce is a huge revolution and it is an emerging trend. As an airline and as a logistics service provider, we need
14 | OCTOBER 2016 www. stattimes. com