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Icelandair Cargo

Icelandair Cargo

“Icelandair Cargo offers its customers competitive and quick global services through its extensive interline and special prorate agreements with other airlines.“

OPERATIONGR_CARGO

The main business of Icelandair Cargo is scheduled freight services on its own freighters and in the lower holds of Icelandair´s passenger aircraft. There are five Boeing 757- 200 freighters in the fleet, of which two came into service in August and November 2006. All aircraft are leased and crews are leased from Icelandair. Some 82% of the cargo is carried on freighters and 18% on passenger aircraft. At the end of the year three freighters were on ACMI (Aircraft, Crew, Maintenance and Insurance) leases to TNT during weekdays and were operated on Icelandair Cargo’s scheduled services at weekends.

The year 2006 was a period of expansion and growth for Icelandair Cargo. Tonnage on scheduled flights grew by 13.7% to 41,000 tons. Two new Boeing 757-200SF aircraft joined the fleet and three destinations, Brussels, Jönköping and Charlotte, were added to the network.

There were nine flights per week to Liege in Belgium, four to Brussels, four to Humberside in the UK, one to East Midlands, two to Jönköping in Sweden, six to New York (JFK), one to Charlotte in North Carolina, and one to Halifax in Canada. This network of freighter aircraft is enhanced by the 23 destinations of the Icelandair passenger network. Imports to and exports from Iceland account for about 75% of the tonnage, while the rest is freight carried between other European countries and North America.

MARKETS

Icelandair Cargo offers its customers competitive and quick global services through its extensive interline and special prorate agreements with other airlines. The company also operates trucking networks in Europe and, by demand, in the US A. Sales are made by the company’s own staff in Iceland, the Benelux countries and North America, and by general sales agents (GSAs) in other markets. The company has a number of GSAs in all of the larger and growing markets in Asia and in most countries in Europe.

review_cargoFor a number of years, Icelandair Cargo has carried express freight for TNT to Iceland and across the Atlantic, as well as freight for DHL from Brussels. Icelandair Cargo also counts FedEx among its most important customers.

In 2007 Icelandair Cargo expects the company to carry 46,000 tonnes, of which a third is expected to consist of exports from Iceland, a third in imports and a third in freight between Europe and North America. Eighty-five per cent of the exports consist of fresh seafood, whereas the imports include produce, hightech products and spare parts. Fish exports from Iceland grew by 11% in 2006 and a similar growth was seen in imports. There is a strong and growing demand for fresh seafood in most European markets, fuelling growth in exports although the supply of fish may eventually become a limiting factor. Imports to Iceland are expected to decline moderately while strong growth is expected in transit freight.

OUTLOOK

The current strategy pursued by Icelandair Cargo assumes a considerable annual growth over the next five years. The emphasis is on making the company less dependent on the Icelandic market and gradually increasing its participation in the global markets. This calls for larger and longer-range aircraft. The Boeing 757-200 fleet is expected to grow by one or two aircraft by 2008, and conversion of the company’s Boeing 767-200 is also being contemplated.

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