Subscribe to our free, weekly email newsletter!


2011 Q4Q Winners: AIR CARRIERS


August 01, 2011


Source: Logistics Management, Peerless Media Research Group

Resilient leaders
While every freight transportation mode took a financial hit during the Great Recession, no other mode had to navigate the level of global volatility that the air cargo sector faced.

In fact, events affecting the air cargo industry over the past 12 months seem almost biblical: tornados, earthquakes, tsunamis, terrorism, wars, revolutions, volcanoes, as well as failing economies and continued sky rocketing oil prices.

As our air cargo correspondent Karen Thuermer reported in LM’s State of Logistics Report last month, the world’s air cargo carriers should be applauded for the work they’ve done to maintain a high level of service during these trying times.

And while the air sector certainly did gain some financial altitude over the course of 2010, they’re still looking for a patch of smooth air in 2011. According to analyst and association reports, despite the fact that air freight revenues rose 11.2 percent in 2010, the sector hit the wall by the end of the year. Most of that growth was in the first half 2010, but by mid-year it retracted as retailers, facing disappointing sales projections, turned largely to moving shipments by ocean.

Recent reports indicate that air carriers saw business continue to dwindle during the first half of 2011 as customers, facing higher transportation costs due to rising oil prices, continued to go with cheaper options whenever possible. Outgoing International Air Transport Association (IATA) director general Giovanni Bisignani recently stated that the association expects the profit margin for 2011 to be a very disappointing 0.7 percent, with overall profits coming in at $4 billion, down a hefty 78 percent from 2010.

Any way the analysts slice it, the air cargo business has shown remarkable resilience over the past two years—and shippers have shown their appreciation.

According to the readers of Logistics Management, the 11 carriers below have weathered the storms and have landed safely as 2011 Quest for Quality winners.

First to the gate again this year is Southwest Airlines with a category-high 50.29 weighted average. To reach this lofty altitude, the carrier posted top marks in On-time performance (12.92), Value (10.98), and Customer Service (10.46). Virgin Atlantic was right on their tail this year with a 49.47 overall weighted average. Virgin tied with Singapore Airlines (47.96) for the top score in Equipment & Operations attribute category (8.50). Lufthansa, which improved its 2010 winning score by more than 10 points this year, put up top marks in the IT attribute category (8.63).

We found quite a bit of continuity in this year’s list of winners. In fact, 9 of the 11 listed won Quest for Quality gold last year—and in nearly the same order. The only 2011 winners that missed the cut in 2010 are Cathay Pacific (46.58) and United Cargo (44.05).


2011 Quest for Quality Winners Categories

NATIONAL LTL | REGIONAL LTL | TRUCKLOAD | RAIL/INTERMODAL
OCEAN CARRIERS | 3PL | AIR CARRIERS | FREIGHT FORWARDERS


home page

Subscribe to Logistics Management magazine

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your
entire logistics operation.
Start your FREE subscription today!

Recent Entries

For November, which is the most recent month for which data is available, the SCI came in at -3.2. While this is still entrenched in negative territory, it represents an improvement over October and September, which were -5.5 and -6.6, respectively.

Total December shipments––at 1,150,810––were 3 percent better than November and up 5 percent annually. And total 2014 shipments––at 14,092,551––were up 5.61 percent, setting a new record for annual shipments during the time which Panjiva has been collecting this data since 2007.

The biggest story in the energy sector has to be the 30% decline in oil prices since June to a level not seen since the global recession cut a whopping 6% from global consumption back in 2009.

The challenge for air cargo operators to fill capacity, and the confidence to add capacity, remain the same as the demand curve for air freight services recovers.

For the fourth quarter of 2014, UPS said it anticipates adjusted diluted earnings per share of roughly $1.25, with full-year 2014 adjusted diluted earnings per share at $4.75, which represents a 3.9 percent annual gain over 2013’s adjusted earnings per share of $4.57, with full-year 2014 diluted earnings pegged at around $3.28 per share, which is 28.9 percent below 2013’s $4.61.

Comments

Post a comment
Commenting is not available in this channel entry.


© Copyright 2013 Peerless Media LLC, a division of EH Publishing, Inc • 111 Speen Street, Ste 200, Framingham, MA 01701 USA