Cargolux looks back at 2015 and ahead to 2017

Luxembourg-based all-cargo carrier Cargolux spent much of 2015 locked in battle with one of its unions, but emerged from the year not only with labor peace finally achieved, but also reporting significant operational gains. Cargolux said cargo volume in 2015 was up 7.4% (well above the industry average) to 890,000 tonnes. How this volume increase will impact the carrier’s bottom line remains to be seen. Cargolux is not publicly traded, and will not release any details of its 2015 financial performance until the middle of the second quarter of 2016.

Turning from past to future, the big news at Cargolux is that the carrier’s Board of Directors yesterday approved an investment of US$77 million for a 35% stake in a new joint-venture airline to be based in Zhengzhou (the site of Cargolux’s second hub). Other shareholders in Cargolux China will be:

• Henan Civil Aviation Development and Investment Co. (HNCA) will hold 49%. HNCA, an investment vehicle of the government of Henan Province, focuses on the development of the civil aviation industry, and has been involved in the construction of the Zhengzhou Airport Economy Zone.

• Xin Gang Investment & Development Co., Ltd  will hold 8%. Xin Gang, a privately held construction company, is responsible for development of the 415 sq km Zhengzhou Airport Economy Zone, in which Zhengzhou Xinzheng International Airport (CGO) is located.

• Henan Airport Group Co. Ltd, the operator of  Zhengzhou Xinzheng International Airport, also holds 8%.

Regarding launch date, fleet and routes, the Cargolux Board offered no new information, merely confirming what CEO Dirk Reich has been saying for some time. Cargolux China is expected to start operations in 2017, “focusing on trans-Pacific and intra-Asian routes.” The fleet “is planned to grow to five 747 freighters within the first three years,” but how many it will start with, and whether they will be 747-400Fs from the used market or new 747-8Fs is something we will have to wait to find out.