Air France KLM 2019 cargo falls 5.9pc to US$2.2 billion in downturn
AIR FRANCE-KLM airline posted a 5
AIR FRANCE-KLM airline posted a 5.9 per cent year-on-year decline in 2019 cargo revenue to EUR2.1 billion (US$2.2 billion) on the back of a 2.3 per cent drop in volumes to 1.1 million tonnes.
Overall the company posted a net loss of EUR385 million for the year with increases in fuel costs and cargo performance having contributed greatly to the result.
Fourth quarter cargo revenues fell 12 per cent year on year to EUR559 million. Fourth-quarter volumes slipped five per cent to 288,000 tons and load factors were 4.5 percentage points to 59.5 per cent.
'Substantial cargo industry capacity additions in 2019 led to the worst traffic versus capacity trend for the last 10 years, driven by opportunistic growth strategies after the strong cargo market in the second half of 2017 and full year 2018. This caused substantial (belly) overcapacity, particularly on the North Atlantic route,' said the company statement accompanying the results.
'On the demand side, at the year end worldwide air freight volumes had fallen for 14 consecutive months, caused by geo-political uncertainties resulting in weak global air freight demand, trade tensions impacting especially ex-Asia volumes and a strong decline in demand from the automotive industry.'
However, the group said that its market share 'proved resilient' with growth 'realised in alternative flows partly mitigating the ex-Asia losses'.
'The group's cargo strategy is focused on maintaining and increasing load factors where possible and taking a pro-active approach to new revenue opportunities,' it added.
'A new revenue action plan for 2020 has been established to deliver incremental revenues.'