Cargolux targets more markets in Africa

Cargolux Airlines

Cargolux Airlines International had an “excellent year” in Africa in 2016 and expects the market to remain stable for the first half of 2017, regional director Africa Jonathan Clark explains to Air Cargo Week staff writer, James Muir.

He says Cargolux registered a healthy tonnage increase compared to 2015 and will remain an important market. The first few weeks of 2017 have been slow due to holidays in Southern Africa but he says northbound traffic has been strong helped by Cargolux’s Fresh product designed specifically for perishable cargo.

Clark notes overcapacity remains an issue in Africa: “As in other markets, there has been some pressure on the yields due to overcapacity, nevertheless Africa is and will be in the coming years a very important market for Cargolux.”

He does not foresee any major peaks or drops in 2017, saying: “One of the reasons that we do not foresee the market growing is related to the lack of investment in the oil and gas industry.”

The market is expected to continue to show moderate growth especially for imports, but exports are more concerning. Clark explains: “The biggest problem will be exports, as most markets rely on perishables. Here, we don’t see a lot of volume growth potential in the coming years as they are already on a pretty high level.”

Manufacturing is also limited to due poor infrastructure such as electricity, deficits in education and governments not attracting multinational companies through incentives.

He says: “The car industry in South Africa is still quite strong, however many suppliers have, or will, move to Eastern Europe and China, where costs are lower and the infrastructure is better.”

Cargolux is exploring new opportunities in Africa. Clark says: “We see the potential to increase our presence in West Africa as well as in East Africa over the coming years.”