At least partially. The two carriers intend to suspend some of their freighter services to the
sub-continent. While Martinair continues serving Bogotá as sole destination south of the Panama Canal, QR Cargo pulls their B777 freighters out of Santiago and Viracopos but continues offering freighter flights to Bogotà, Quito, and Guarulhos, a spokesperson told CargoForwarder Global. Simultaneously, the Arabian carrier will also abandon some routes to the U.S.  These unexpected network decisions, both becoming effective during the course of SEP24, have caught forwarding agents by surprise – particularly those who had been allocated major volumes by their airline partners on routes across the South Atlantic.

Capacity crunch looms
Their withdrawal means that roughly 600 tons of capacity will be removed from the market. In the case of Qatar Airways Cargo, it concerns three B777-F flights connecting Luxembourg with South America, accounting for 300+ tons. Martinair used to operate three weekly B747ERF flights from Amsterdam to Viracopos (VCP), with two of the services connecting VCP with Buenos Aires (EZE) and Santiago de Chile (SCL), offering a total of 330 tons.

Forwarding agents are not amused
Why this move and why at this time, i.e. in the middle of the current summer flight schedule period which runs until 27OCT24? These questions come to mind. There are three key considerations. Firstly, the shift of capacities from transatlantic routes to the Far East is based on commercial considerations. There, the rates per kilogram are significantly higher compared to South America rotations. Secondly and related to the aforementioned reason: The e-commerce market is booming on routes to and from China, so shifting additional capacity on sectors served between the Far East and Doha or Amsterdam, is a plausible consideration. Thirdly, rotations between Europe and Buenos Aires, Montevideo, Santiago de Chile or even Viracopos, are time consuming and thus costly. If these services do not generate sufficient margins over a longer-term period, scaling them down or discontinuing the services completely is sensible.

Far East flights pay off more
This is confirmed by Adriaan den Heijer, EVP Cargo at Air France-KLM and Managing Director Martinair: “In the East Asian market, the e-commerce segment is growing steadily, driving increased demand for efficient and reliable air freight solutions. The introduction of this [Martinair’s] new Boeing 747 freighter service [to HKG] is a crucial step in adding main deck capacity to our extensive belly network. This expansion not only strengthens our freighter footprint in Asia, but also offers more options and greater flexibility to our customers. By enhancing our connectivity and broadening our reach, we are better positioned to support the growth and evolving needs of our global customer base.”

Returning after almost a decade
The network change at Martinair (MP) will take effect on 19SEP24. On that day, the airline’s first flight to Hong Kong will take off from Amsterdam, ending an absence of almost nine years. All flights, initially three per week but to be increased to 4/7, will be operated via Dubai, using a Boeing 747-ERF that offers a payload of 110 tons per flight.

At least MP is not withdrawing completely from the subcontinent. Flights to Bogotá will continue with three B747F rotations per week via Miami. The Franco-Dutch group also emphasizes that Air France-KLM operates 145 weekly passenger flights to 24 destinations in Latin America and the Caribbean, offering abundant capacity in their cargo holds.

QR Cargo shifts capacity to Asia and Europe
Qatar Airways Cargo will discontinue the above-mentioned flights to / from South America in the course of September. According to its itinerary, these are 4 weekly frequencies. The carrier enjoys strong partnerships with a number of airlines on routes to Latin America, so that the discontinuation of flights to Santiago and Viracopos could be easily compensated by partners jumping in. One of them is the Chilean airline LATAM and its cargo arm, with which QR is on friendly terms. This amicable pact does not include a capacity agreement between the two airlines, although QR holds a 10% stake in LATAM. A LATAM executive told CargoForwarder Global that without regulatory approval such accords are illegal for compliance reasons.

Further north, QR Cargo will also scrap routes between Europe and the U.S. This affects Atlanta that is completely taken off the route map, among other destinations, while Chicago will continue to be served.

Asked about the network changes, QR Cargo delivered this statement: As the world’s leading cargo airline, operating in a dynamic market, it is our responsibility to address market needs. Our global customers and consumers drive our capacity and market changes, resulting in Qatar Airways Cargo adding extra frequencies to India, China, Vietnam and Europe. The Doha-based cargo carrier serves a global network of more than 60 freighter destinations and 170 passenger destinations utilizing freighters and belly-hold passenger aircraft. 

Demand tends to outgrow capacity
QR Cargo’s and Martinair’s withdrawal of main deck services from the South American market (except for Bogotá) leads to a considerable capacity gap. This might at least partially be filled by freight hungry Cargolux, Lufthansa Cargo, and LATAM Cargo, which will continue to operate freighters across the South Atlantic as documented in their itineraries. LATAM Cargo, for instance, operates 10 cargo flights per week deploying B767Fs ex Amsterdam, Brussels and Frankfurt, and serving the Brazilian destinations Viracopos, Florianopolis, Curitiba, as well as Montevideo, Buenos Aires, and Santiago de Chile. Thus, the airline holds pole position in freight traffic between Europe and South America. This is a considerable advantage, especially should the demand for air transportation increase moderately or even sharply in the coming peak season.

Cargolux offers customers three B747 freighter flights a week to Viracopos, Rio de Janeiro, Curitiba and Quito, and Lufthansa Cargo operates four freighter frequencies to six destinations, complemented by daily passenger services to Sao Paulo, Buenos Aires, and Bogotá (5/7). The cargo holds in the lower decks of Lufthansa’s jetliners, are roughly equivalent to the capacity of three Triple Seven freighter aircraft.

It is unlikely that EK, EY or TK will fill the capacity gap
It is not known whether the cargo divisions of Emirates, Turkish Airlines, and Etihad have plans to adapt their networks to and from Latin America following the withdrawal of Qatar Airways Cargo and Martinair. Yet even if they do, it will not bother LATAM Cargo, CV Cargo, or Lufthansa Cargo as their peers from the Middle East do not siphon off European produce to first fly them eastbound to their hubs Istanbul, Dubai or Abu Dhabi, and from there westbound across the South Atlantic to Latin American final destinations. Such time and fuel consuming detours make neither commercial nor ecological sense.

Finland was once a key gateway for passengers and air freight shipments on routes between northern Europe and China. In the meantime, the former flow has become a trickle. This is because the long-standing advantage of short flight times between the two countries has grown from formerly nine hours to twelve hours or even more. From the moment Moscow’s air space closed for Western airlines, Finnair lost a key USP that had benefitted the carrier over many years.

Hans-Ulrich Klose, the former mayor of Hamburg, was known for his clear words. During a meeting of aviation journalists, he once said: “If I want to fly from Hamburg to China, why should I first fly to Frankfurt, Paris or London to catch a long-haul flight to Beijing, Guangzhou or Shanghai, from there, only to fly, four or five hours later at an altitude of around 10,000 meters above Hamburg, where I had begun my journey towards the Far East.” And he added: “The smarter route is Hamburg-Helsinki-China, which saves air travelers 5 hours or more.” His statement immediately caused outraged protests at Lufthansa.

Salmons demand speedy transport
Mr. Klose died in 2023. The hassle caused by time-consuming long-haul flights on routes between Europe and the Far East, has become even more acute since then. Hardest hit are passengers from Scandinavia and northern Germany, but also freight forwarders doing business there. This is particularly a challenge for Norwegians who rely heavily on time-definite salmon and seafood transportation bound for Korea and Japan. Flight times are longer, prices have increased, and greenhouse gas emissions per flight have also risen due to the detours Finnair or SAS are forced to take to avoid touching Russian airspace.

Sharply reduced flight program
Finnair has so far scrapped flights to six Chinese cities due to cost-cutting measures. Only Shanghai and Zhengzhou are still served, albeit with fewer frequencies. Since 2020, the formerly highly frequented Helsinki-Shanghai route has been cut by 9%. Flights between Helsinki to six other Chinese cities have been stopped altogether, as data identified and evaluated by Cirium consultancy, shows. “Helsinki’s main attraction was its favorable geographical position enabling shorter flying times between northern Europe and China, benefitting not only many travelers but shippers and forwarding agents alike,” states Nouri Neller, Managing Director of general sales agent and cargo broker, AirCargoConcept (ACC).

Trains stopped running
Meanwhile, the number of Chinese tourists to Finland toppled from a late-2019 peak of more than 40,000 per month, to last year’s monthly apex of around 12,000, according to the Bank of Finland Institute for Emerging Economies, states South China Morning Post in a report. Rail services crossing the vast Siberian land bridge between China and Finland, have stopped altogether. As have trains formerly running between Helsinki and St. Petersburg, with onward transportation to final destinations in China. 

Trade volumes go south
This all led to a sharp contraction of trade volumes between China and Finland. According to Chinese customs data, it reached USD 2.6 billion in the first five months of this year, versus USD 3.3 billion for the same time span in 2023. It doesn’t take a prophet to predict that the trade volume between the two countries will continue to decline, since the Russians do not appear to be willing to end their war against Ukraine. In that case, sanctions will not be eased but stepped up instead. These are not hopeful signs for intercontinental air traffic between China and Europe, not to mention the mounting technical and financial pressure bringing Russian airlines to their knees.

In Sichuan’s capital, Chengdu, leading executives of DHL Express and cargo carrier, China Central Airlines, met to agree on a cooperation. The outcome of the gathering was that both sides signed a letter of intent to start joint freighter operations. This will be enabled by two Triple Seven freighter aircraft provided by the integrator, that will be deployed on international routes. The multi-year agreement is the first one ever between the package delivery company and a Chinese cargo carrier.

The two B777-200 freighter aircraft belong to DHL’s fleet and will be utilized to strengthen DHL’s intercontinental e-commerce services. “This increases our capacity offering to the market and adds another puzzle piece to our global network,” says Sabine Hartmann, spokesperson for DHL Express. She adds to this that many technical, operational and staffing aspects still have to be carved out, since a letter of intent is just a memorandum of understanding aimed at joining forces without specifying the terms of the forthcoming collaboration. Therefore, network decisions or operational issues are still not defined. This also includes cockpit arrangements, whether Central Airlines’ own pilots will operate the aircraft or DHL own cockpit crew instead.

Dual logo on the hull
Since the deal was inked in Chengdu, it can be assumed that the aircraft will be based at Chengdu Tianfu Airport, located 51 km southeast of the city and operational since mid-2021. However, the letter of intent reveals no information on this.
In contrast, it has been agreed that the freighters will display the logo of both partners on their fuselage, following the proven dual livery example of Polar/DHL or Kalitta/DHL, where both companies’ names appear on the jointly operated freighters.
“The signing of the Letter of Intent is an important milestone for both parties in the process of establishing a partnership and is another important step for DHL Express to deliver its commitment to long term development in China, and to seek and deepen its cooperation with Chinese companies. The partnership with Central Airlines will further strengthen our capacity on intercontinental cargo routes from China, while providing more convenience and higher efficiency for Chinese enterprises to expand their businesses globally,” said Dongming Wu, CEO China at DHL Express.

Strengthening e-commerce traffic
Annie Hou, Chairman of Central Airlines, reacted to this statement with the following words: “We are very pleased to establish a partnership with DHL Express and are full of expectations and confidence in the prospects of cooperation between the two sides. The partnership fits well with our current B777 freighter operations planning. With the two additional B777-200 freighters, we will provide stronger capacity to support DHL Express and contribute to the development of cross border e-commerce and promoting China’s supply chain and Chinese firms going abroad.”
In MAY22, China Central Airlines filed an application to change its main operating base airport from Zhengzhou Xinzheng International Airport to Haikou Hainan Meilan International Airport. After approval, the freight carrier relocated its headquarters to Haikou Airport. Since AUG22, it is the first airline to run a full cargo main base in the Province of Hainan.