Japanese
carrier All Nippon Airways (ANA) is bullish on freight
out of Asia this year, despite reporting declining revenues
on international services last month in its annual report,
and admitting that a subdued Japanese economy was dampening
the domestic outlook.
An ANA spokesperson told FlyingTypers the airline expected export cargo
from Japan to remain weak this year, but “for
FY2016, we see the cargo demand departing Asia will
be strong.”
But the spokesperson
said demand growth this year had been patchy and ANA
would be “setting flexible fares to address the
supply-demand balance as well as cancelling some freighter
flights when demand is low.”
Not that this cautious
approach is seeing ANA—which currently operates
some 250 aircraft, including 12 freighters—adjust
its ambitious objectives, which are focused on becoming
a regional and global player rather than a Japan-centric
carrier. Indeed, at the start of this year the carrier
unveiled its new five year plan for FY2016-2020, during
which it aims to increase both international passenger
and cargo revenues by 40 percent and achieve an operating
profit of ¥200 billion in FY2020.
ANA also aims to achieve
profitability in the air freighter business by FY2017
and become one of the world’s top five carriers
in terms of freight handled by FY2020, up from 8th place
last year. “By the end of FY 2020, ANA plans to
achieve capacity on a tons-kilo basis of 138 percent
compared to FY 2015,” the airline wrote in a mission
statement.
“While
maintaining profitability in its core full-service domestic
passenger business, ANA will actively expand its full-service
international passenger business, LCC business, and
cargo business. In addition, ANA will continue to improve
the profitability of its non-airline businesses, working
to build an optimum portfolio for the maximization of
overall profitability.”
To this end, ANA will
further develop a logistics service that covers all
of Asia, where growth is rapid, while the spokesperson
added that ANA had also been building up its OCS arm,
which offers end-to-end supply chain services and which
the carrier is using to increase its exposure to growing
e-commerce markets.
“Based on the largest
and fastest growing market, Asia, we aim to develop
an integrated logistic service across the region by
harnessing freighters and infrastructure via our Okinawa
cargo hub,” said the spokesperson. “E-commerce
is expected to grow, especially for destinations in
China. We continue to expand our Business to Consumer
business, together with OCS, and expect to increase
revenue by JPY1.0 billion annually.”
ANA Cargo’s joint
venture agreement with Germany’s Lufthansa Cargo
has been up and running for more than a year on Asia-Europe
routes and this is expected to be a key revenue driver.
A similar agreement is in place with United Airlines
covering Transpacific markets and is due to start operations
before the end of June on routes from Japan to the U.S.,
and in the second half of the year in the opposite direction.
“The JV with LH
has started both ways since last summer,” said
the spokesperson. “The planned target increased
revenue will be, including our JV with UA, JPY1.5 billion
for FY2016.
“JVs allow both
carriers to best utilize our space, provide customers
with a wider option of flights, and therefore improve
flexibility.”
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