Qatar Airways has announced
its intention to tap the surging
e-commerce business by getting
into door-to-door courier delivery.
Speaking to cargo media in Doha,
Qatar Airways chief executive, Akbar Al
Baker said the new QR Express product
announced today, was aimed squarely at
the growing global ecommerce logistics
business.
“We want to get into the courier
business which is high yield and high
margin business,” Al Baker said. “We are
very keen on this and this is the first step.
We don’t want to be the likes of FedEx,
DHL and UPS but we want to play a
significant part in this very lucrative
business.”
“If you look at the capacity of FedEx
and if you see their network, their
network in America alone is bigger than
our total network, so we are really not
going to compete, but we are going to
compete within our sphere of influence
where we operate,” he added.
Citing the example of the UK, the
Qatar Airways CEO noted the carrier
would not be interested in carrying
packages to the smaller regional cities, but
would instead focus on carrying packages
to the larger cities of London, Manchester,
Edinburgh for instance.
Th e carrier plans to subcontract the
door-to-door delivery to another party
which will operate the final-mile delivery
under the Qatar Airways brand.
Qatar Airways chief officer cargo,
Ulrich Ogiermann said the test phase
has already been launched in London
and by the end of the year will roll out
to another couple of stations. “We cannot
do this on a world-wide basis all in one
go, we have to build up the expertise on
the ground with the third-party provider,”
Ogierman said.
Growth & quality
While growth is important, Al Baker
emphasised it’s not merely growth for
growth’s sake. “We are not here in the
business of charity,” he highlighted. “I
would not have a big freighter fleet if I
was not going to be profitable. I made it
very clear that we are not here to show
our flag, we are a business entity and we
are responsible to my government as a
business to make money,” he said.
“What we are interested in, is not to
become number one, but certainly to be
one of the top three which we are already
and the quality of product delivery that
we will be providing will surpass all the
number one and number two in the
ranking,” Al Baker told air cargo media in Doha. “So the ranking in size is not
important to us, what is important to
us that we want to be number one in
the customer service that we provide to
our clients.”
“Two years ago I committed to driving
QR Cargo to the worlds fifth largest
cargo carrier and the good news today
is that I’m proud to announce that we
have surpassed that goal and based on
the latest IATA FTK rankings we are
now number three in the industry, Al
Baker said.
He went on to note that Qatar Airways
is a diverse company in every part of
the supply chain and highlighted it
was a success story since starting cargo
operations in 1997. At that time the
carrier uplifted only belly cargo, “and
since then our FTK growth has been
phenomenal and our position in the
IATA cargo ranking has steadily risen,”
he said pointing to the fact that in 2010
the carrier was sixteenth in terms of
FTKs and now only five years later its
number three.
“Qatar Airways Cargo is continuing its
growth and contributing fundamentally
to the growth and expansion of Qatar
Airways also as a global cargo carrier.
In today’s world, few airlines can thrive
without successfully tapping into the
cargo component of their business as an
airline,” Al Baker said. He added that the
carrier is aiming for a contribution from
the cargo division of up to 25-30 per cent
of the total airline revenue.
“Our predictions for the future are very
bright we want to be industry leading
carrier offering more efficient services
through our improved technology and
investment,” both of which will result
in cost savings for the carrier, which
will then be passed on to its clients, Al
Baker said.
“Th e airlines which do not invest in
its cargo divisions will continue to lose
their market share and in the next five
years, in my opinion at least one or two
major players will bow out of the cargo
industry,” he said. “I will not name them,
I know who they are, but I will not name
them,” he added coyly.
Fleet expansion
From only belly-capacity 18 years
ago, the carrier now has a fleet of 15
freighters – eight B777-200s, six A330-
200s and one leased B747. Belly-capacity remains a key component of the airline
with its passenger fleet having substantial
wide-body aircraft including 30 B777s,
28 A330s, 23 B767s, six A380s and at the
moment four A350s.
This of course is set to change
substantially with between nine and
11 aircraft coming in before the end of
2015. Currently Qatar Airways serves
48 freighter destinations, more than 150
belly hold destinations and has over 100
interline partners.
Th is growth sees no signs of abating
either with Al Baker confirming at the
press event Qatar Airways’ commitment
to expanding the cargo fleet further –
with a seventh A330-200 freighter to be
delivered in December, an eighth A330
in March 2016, the ninth B777F in June
2016, a B777F in July 2016, the 11th
B777F in October of 2016 and yet another
B777F of March 2017. “As you can see
we’ve already added four freighters in
2016 taking our total freighters to 20
and eventually our 21st freighter the
following year.
“Our network enhancement has also
been very rapid – in 2014 we added 12 new passenger destinations and 11 new
freighter destinations – this is already
a record for any carrier to achieve this
massive growth in just one year,” says
Al Baker. In 2015 alone QR added four
new freighter destinations and from
November to Dec it will enhance services
to Mumbai, Hyderabad, Chennai and
Dhaka.
Th ere is also a launch of a new route
to Durban with 40 tonnes of belly cargo
a week and in March 2016 it will launch
a new route to Sydney with an additional
40 tonnes of belly cargo per week.
Hub growth
All of this growth at the home carrier
has also been a windfall for Doha,
ascending to global hub status alongside
the growth of Qatar Airways. “Qatar
has of course become a global hub and
has established itself in the forefront of
global aviation the country has invested
significantly in infrastructure projects
and aspires to become a world recognised
logistics centre with the development of
free trade and logistics zones expanding
around my country.
“Qatar airways cargo has reached
where it is today through commitment
and vision of course our employees and
the technology that we deploy,” he said
pointing to Cromos, the next generation
cargo management system that was
developed by the carrier’s in-house IT
department along with a third-party
provider.
It is also committed to growing the
cargo infrastructure with a new US$1
billion state-of-the-art 292,000 sqm cargo
terminal – the cargo terminal building
itself is 55,000 sqm – with a capacity of
1.4 million tonnes annually and parking
stands for 11 freighters simultaneously.
And clearly the theme of growth
touches all aspects of the carrier’s
business, with Al Baker announcing at
the press conference plans for a second
cargo terminal more than doubling the
capacity of the current operation.
Th is will take the total capacity to
4.4 million tonnes per annum when the
second terminal is operational, boosting
the existing facilities by 110,000 sqm.
“The new cargo terminal, which is
scheduled to open in 2017, underlines our commitment to continued growth
and expansion in line with the airline’s
group objectives for the future,” added
Qatar Airways chief officer cargo, Ulrich
Ogiermann. “Having the ability to handle
4.4 million tonnes of cargo a year will put
Qatar Airways Cargo into another league,
and enhance the efficiency and service
already offered at our existing state-ofthe-
art facility,” he said.
But not stopping there, Al Baker also
announced a further cargo terminal
that will leapfrog the 4.4 million tonnes
capacity to seven million tonnes, a feat
that is targeted to be operational in just
over years’ time, in 2018.
He said the investments at Hamad
International Airport were testimony to
the seriousness with which Qatar Airways
regards cargo. He added: “Our cargo
network direct from Doha using our B777
freighters, we are covering nearly 88 per
cent of the total world’s population.”
The carrier is also keenly committed
to corporate social responsibility as well,
evidenced by the 22 freighters full of aid
that it sent to Nepal after the earthquake
earlier this year.
Specialty products
It also has ventured down the highyield
route of many of its contemporaries,
having launched QR Pharma not long ago,
with 54 approved pharma stations on the
QR network already. These include both
active and passive stations, quick ramp
transfers at its Doha hub, and a dedicated
climate control team.
Th e carrier also has QR Fresh for
transporting fresh products and its hub
is compliant to IATA Ch. 17 and has high
loading priority, quick transfer at ramp,
temperature control vehicles at the hub
and also a dedicated climate control team
for fresh products.
QR Charter is another new product,
positioned as a quality, reliable and cost
effective global charter solution including
full, part and combination charter
operations. Th is is where the recent lease
of a B747 converted freighter comes into
the picture – which is only a temporary
solution while the carrier awaits a noseloading
B747-400.
“Th e new arrival of this new B747
freighter is exactly for this purpose so
that we can carry outsized cargo.” Moving
into this area was given a substantial push
by the fact that QR had previously been
refusing outsized cargo because it simply
did not have the capability. “So we were
giving an opportunity to our competitors
to fill in this small void that existed in the
Qatar Airways cargo fleet,” says Al Baker.
Also announced at the event was
another new specialty product – QR
equine offering five-star service and
world class facilities for the transport of
horses, which is managed by a dedicated
team of experts both in Doha and
abroad. “We’ve committed to creating a
unique mix of industry-leading specialty
products, we’re committed to expanding
in every aspect of the cargo market, Al
Baker added.
