Frankfurt, 27.08.2009
Dear Mr.,
Only a few days ago we again grounded one of our MD-11 cargo aircraft - and another one will follow in the coming weeks. That means that a total of four of our freighters will soon be parked in the Californian desert. By the end of September, we will have further reduced our freighter capacities by about 30 per cent. We have never witnessed anything like this before in the long history of our company, and it will not be without consequences for our business model.
The massive slump in demand has, of course, affected everyone involved in the transport chain - forwarders, shippers and airlines. But we, the carriers, have been hit particularly hard. The International Air Transport Association (IATA) predicts that the world's airlines will collectively post a record full-year loss of at least nine billion US dollars for 2009.
At present, the drastic fall in demand for airfreight capacity is accompanied by a dramatic decline in rates. In the last six months, the ten largest IATA cargo carriers have together returned a loss of well over a billion euros. Lufthansa Cargo alone recorded a loss of 134 million euros in the first half of 2009.
This is why we face unprecedented pressure. If current market trends continue, we expect that, in the medium term, the majority of the world's freighter fleet will have to be permanently grounded because there will simply be no economic justification for keeping these aircraft in service.
In order to meet the current market challenges, we will gradually raise our rates over the coming weeks by an average of 25 percent worldwide. But even this increase will only partially compensate for the dramatic decline in rates in the last few months.
In addition, your personal Lufthansa Cargo customer representative will provide you with detailed information for your specific market.
We ask for your understanding - these measures are unavoidable in view of the unprecedented market conditions. At the same time, we hope that you will stand by our side, particularly in these difficult times. Our close, longstanding partnership and the established relationship of mutual trust will help us to weather this crisis and to emerge from it jointly stronger than before.
Yours sincerely,
Dr. Andreas Otto
