Virgin aims to capitalise on pharma and e-commerce growth

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Virgin Atlantic Cargo

As an airline that has grown up on transatlantic routes over more than 30 years, Virgin Atlantic Cargo says it is perfectly placed to capitalise of two of the industry’s fastest-growing trends; e-commerce and pharmaceutical shipments.

Virgin now provides some 30 per cent of all capacity on transatlantic routes, the world’s largest pharma trade lane and a buoyant market for international e-commerce, and 2017 has seen its commitment increase even further.

Seattle is the latest destination to join Virgin’s transatlantic network, which also includes Atlanta, Boston, Las Vegas, Los Angeles, Miami, New York, Newark, Orlando, San Francisco, Seattle and Washington.

Business from the UK to the US continues to show the most sustained level of growth. Tonnage rose 8.4 per cent in 2016 and this momentum has continued into this year.

Tonnage in March alone was up by more than 20 per cent over the previous year, and Virgin says nearly all of its routes to the US were ahead of expectations.

On a route sector with such intense competition, Virgin’s ability to consistently ‘punch above its weight’ in a market under constant yield pressure is down to its service.

Virgin Atlantic Cargo managing director, John Lloyd (pictured above) describes the airline’s commitment to great service as a ‘passion’ and it applies just as much when there’s a problem that needs fixing or to finding a bespoke solution to meet a customer’s needs.

While Virgin may not be able to compete in terms of size alongside the world’s biggest airlines, Virgin Atlantic’s network is made up of many other desirable cargo routes beyond its US stronghold.

These include Shanghai and Hong Kong, Dubai, and the biggest airfreight gateway in India – Delhi, South Africa and Nigeria.

It has also extended its appeal by offering fast trucking connections over London to more than 50 of the major airports in Europe.

Plus, through its longstanding and growing long-haul cargo sales and management contract with Virgin Australia, which began in 2009 and was extended again in 2016, this March saw the addition of Virgin’s Australia’s new Melbourne-Los Angeles route.

The new route joins its existing services connecting Sydney and Brisbane to LAX.  Virgin Atlantic Cargo can seamlessly connect Australia to its global network, and vice versa, via the US west coast city.

As well as expecting to see a continued increase in e-commerce business on its network in 2017, Virgin is actively developing its solutions for pharma customers, although Lloyd is keen to point out that the airline is no newcomer to the sector.

“We’re seeing strong growth in our pharma business because we can add real value for our customers. Once you prove your capability and earn customer trust, they will pay a fair price to guarantee the integrity of their product is maintained throughout the cool chain.”

“We’ve been carrying pharma shipments for a number of years and are steadily increasing our market share, particularly from the UK to North America.”

Virgin Atlantic Cargo

“Ecommerce also demands speed and reliability. Business to and from the US is growing substantially year-on-year and our high frequencies of daily services connecting major US cities and the UK means we are well placed to benefit from the online shopping revolution.”

“The global B2C ecommerce market was worth nearly $2 trillion in 2016 and is forecast to grow to $4 trillion by 2020 so it is going to generate long-term business for airlines that offer the best value/service proposition,” he says.

Virgin’s ability to compete will be further enhanced in early 2019 with the delivery of the first of 12 Airbus A350-1000 aircraft following a $4.4bn order placed by the airline in 2016.

For cargo, the aircraft promises a significant improvement in lower deck cargo capacity of between 10 and 22 per cent over the aircraft it will replace.