Effective today, Henan Civil Aviation and Investment Co. Ltd (HNCA, an investment arm of the government of China’s Henan province) owns 35% of Luxembourg-based Cargolux Airlines. The sale of the stake to HNCA was agreed to late last year, and although it has only become final today, it has already had an enormous impact on the carrier.
From the beginning, the prospect of selling the 35% stake to HNCA was divisive, with the Cargolux Board and the Luxembourg government (which owns the carrier) pitted against senior executives who believed the conditions demanded by HNCA would be ruinous. When the Board and Government, against the advice of top management, signed the deal they were US$231 million richer, but all those millions of dollars came with a high price – the resignations of Senior VP Marketing and Sales Robert van de Weg, COO Peter van de Pas, and Asia boss Matthew Ma. All of which came at a time when Cargolux was without a permanent CEO.
So today is Day One for the New Cargolux:
- New ownership structure
- New dual-hub strategy
- New CEO (Dirk Reich, who will also take over as SVP Sales),
- New SVP Asia Pacific (Robert Song, the point man for HNCA during their purchase of the 35% stake),
- Many new faces in other executive positions…
This list could go on, but the point is that the Cargolux that has been such a significant point of reference for the air freight industry is gone. The carrier that replaces it has the same name, and yes, there will be some continuity, but it really is a new player. Perhaps, given that the air freight game has changed so much in the last few years, new players are only to be expected. But tonight I expect many in the industry will be raising a glass in memory of the “Old Cargolux.”
For more on the New Cargolux, and the problems it faces implementing its dual-hub strategy, click here to read the analysis written by our European editor Alex Lennane.