FNC GROUP,Intl Freight Forwarders Network Shipping News

Possible Nation Wide Strike in India from 5th December & Restriction of Export Movements at Chennai Port

Admin Dept — Wed, 01 Dec 2010 05:08:59 GMT

Dear All

We understand from the sources that the 2nd round of talks between the Government and the Lorry Transport Owners (AIMTC) was failed as their demands are not met. Hence The All India Motor Transport Congress had decided to go ahead of their original plan of going on an INDEFINITE NATIONWIDE STRIKE from 5th of December, 2010 Midnight.

Meanwhile, the Chennai Container Terminal is facing heavy congestion right now. The terminal is facing heavy inventory load which is a result of the driver's and cleaner's strike in Week 46 (13-16 November) leading to trailer shortage impacting import pendency at the terminal.

We understand from the shipping lines in Chennai that in order to clear the congestion at the port, a meeting was convened by all Trade bodies and the following has been agreed to ease the congestion in the Port through mass evacuation of the inbound containers from Port CY to off dock CFS..

1. Export carting into the port will temporarily be stopped for 3 days starting from 2nd December 1200 till 5th December 1800 hrs.

2. CFS will stop stuffing export containers from 2200hrs today, 30th November 2010.

3. Both terminals (CCTL and CITPL) will offload export containers till 1200 hrs of 2ndDecember 2010.

4. Export Factory stuffed containers arriving after 1200 hrs of 2nd December will be accommodate in CFS till export carting commences.

5. Import evacuation will be focused on during the above said dates.

Thanks with Warm Regards,

M.Sriram

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No.15/8, First Floor, Second Main Road, New Colony, Chrompet . Chennai – 600 044, Tamilnadu, India.

Direct Telephone No.+9144 42877201 // Board Telephone No. +914422410701 // Fax :+914422410703

Mobile +91 9962200441 Skype sriram_maa

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Yahoo sriram_maa Mail sriram@vglogistics.org

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Container Trailor Operatorw at Chennai - On Flash Strike

Admin Dept — Mon, 15 Nov 2010 02:12:20 GMT

News Reported By Victory Global Logistics - FNC Member - Chennai

Dear All

The container trailor operators at Chennai are on flash strike from 1000 hrs on 13/11/2010 due to altercation between one of the drivers and General public, hence all the in and out movements from the port is totally affected. Coupled with the above problem, the roads leading the GATE NO.1 ( 'O' Gate) meant for receiving export laden and empty container is congested and the queue is upto 15 K.M long . This was mainly due to the bad and unusable port main gate.

Also 2A gate ( meant for import laden and empty trailors/tankers going out) is still in unusable condition and hence all the import laden containers (off-deck CFS movement) were also diverted through GATE No.1 which is adding more congestion at the main gate.

The drivers are very much upset due to this long delay as they could not make enough trips and the turn around of the Vehicle is very slow. Trailor movement are still affected due to drivers agitation against outside road condition and frequent fiction with local residents leading to law and order. The strike continues till date.

The Confederation of Surface Transport in Tamil Nadu has already announced an indefinite strike by trailers, trucks and lorries from November 22, condemning the poor maintenance of Tiruvottiyur-Ponneri Road and Madhavaram-Manali Road.

Meanwhile a press report in local Tamil newspaper stating that a case filed in High Court to restrain container movement on Ennore Road until the road expansion is completed; a notice to this effect is send to Central and State Government for their inputs.

Port Chairman is expected to convene a meeting today afternoon to defuse the situation.

Shall keep you posted on developments.

Thanks with Warm Regards,

M.Sriram

************************************************************************************************************

No.15/8, First Floor, Second Main Road, New Colony, Chrompet . Chennai – 600 044, Tamilnadu, India.

Direct Telephone No.+9144 42877201 // Board Telephone No. +914422410701 // Fax :+914422410703

Mobile +91 9962200441 Skype sriram_maa

Googletalk sriramvglmaa@gmail.com Msn sriramdel@hotmail.com

Yahoo sriram_maa Mail sriram@vglogistics.org

************************************************************************************************************

WE SERVE OUR BEST TO WIN YOUR TRUST

European Union Black Listing Airports that are not secured:

Admin Dept — Fri, 12 Nov 2010 06:33:17 GMT

The associated press reporting that European union interior Ministers panel Monday reviewed that a proposal to tighten the Air cargo security which should include black listing risky airports that are deemed to have inadequate security systems.

The German interior Minister Thomas De Maiziere saying that a five point plan will be implemented to protect the Airports to avoid security threats which was happened last month in Yemen.

Several countries including United States, Germany, and Britain, France have temporarily banned all Air freight from Yemen.

European Union has had a list of unsafe Airlines since 2006 and it is also included 278 banned airlines from various countries. Most of the carriers are from Africa and Asia.

European Union finds Cargolux dollar 112 million for Air cargo cartel :

The Luxembourg based Cargo airline Cargolux find by European Union for illegal air cargo cartel. The fine was $112 million. According to the airline the fine would not be a major impact of its revenue and it has already made sources for this penalty.EU also find other airlines for alleged conspiracy to fix prices mainly for Fuel surcharge.

Maersk container shipping business continues to improve in 3 Q.AP Moeller – Maersk declared that 3 Q income statements improved comparing to previous Q.The business is now healthiest has been for sometime and 47% of companies revenue for 3 Q’s helped to drive company wide margins north of 20% during the Q

Indian ports container volume increased 12%:

The major port in India is reported 12 % increase in the month between April and October 2010.The volume for first seven month of the financial year was estimated at 4.4 million Tues comparing 3.9 million Tues last year. The Navasheva port, the largest Indian port handles 2.5 million Tues which shows 9% increment comparing to last two years.

Standardization of Cargo Liability announced by IATA

Admin Dept — Fri, 16 Jul 2010 07:34:06 GMT

IATA has announced the standardization of cargo liability limits. With regulatory approval and with effect from 1 July 2010, the Air Waybill (AWB) Conditions of Contract (IATA Resolution 600b) have been changed to harmonize the application of the Montreal Convention liability limit for all air cargo across all routes.

This simplified approach improves efficiency for shippers and forwarders. It is also consistent with industry efforts to improve competitiveness by simplifying global processes with projects including IATA e-freight.

The amendment to Resolution 600b standardizes the application of the 19 Special Drawing Rights (SDRs) per kilogram Montreal Convention liability limit to all routes worldwide. The following advantages derive from the change:

- Increased certainty for claims handling and service determination
- Increased accuracy for claims procedures by standardizing the various regimes

The single global standard eliminates the uncertainty that existed where there was no applicable convention, or where existing conventions were out-of-date or required conversions from non-existing currencies, such as French gold francs.

IATA says that the acceptance by airlines of the Montreal Convention liability limit standard on all routes is a step forward for the air cargo industry.

Oliver Wyman / IATA Air Cargo CEO Review Forecasts Stabilization, Consolidation

Admin Dept — Thu, 11 Mar 2010 00:54:52 GMT

International consulting firm Oliver Wyman, with help from the International Air Transport Association (IATA), today revealed the results of its 2010 GlobalAir Cargo CEO Assessment at the IATA World Cargo Symposium in Vancouver. This year's survey of more than 30 CEOs of top globalair cargo players found that, while the global economy may be showing signs of stabilization, the recovery in the air cargo market is still fragile. Survey highlights to include:

# Air cargo firms are careful about scheduled ameliorations in 2010, but most predict a return to 2007 peak levels within 1-3 years.

# The greater part of growths is predictable to come from China and North Asia, accompanied by the rest of Asia-Pacific. Therefore, air cargo providers chart to focus sales concentration in these terrains.

# In spite of the planned recuperation, client purchasing likings and patterns have experienced a stable shift. Customers will keep on to be most price-sensitive and will sharply appraise substitute transportation modes to meet their shipping needs for segments with slower supply chain needs.

# Temperature-controlled and pharmaceutical shipping are widely expected to lead the recuperation in terms of growth rates; nevertheless, yields for this section will unavoidably come down, too, unless carriers can clearly differentiate their offering and forge closely integrated associations with customers around these products.

# The most immediate CEO investment priority is the e-freight; others include security improvements, cold chain capabilities, and lightweight containers.

Air Cargo World Declares 2010 Air Cargo Excellence Survey Conquerors

Admin Dept — Thu, 11 Mar 2010 00:27:33 GMT

The five main airlines were honored with awards from bronze to diamond, on 9 March, the function in Vancouver. Airlines Southwest Airlines had the highest overall score led all airlines in performance and price category, and obtained the biggest award of the night, the Diamond Award.

Airports highest rated airlines and carriers include Memphis in North America, Europe, Amsterdam and Seoul Incheon in Asia and the Middle East, one million metric tons or more categories. In half a million tons, for the class, Dallas / Ft Worth, Luxembourg and Tokyo's Haneda took the initiative in the regions. For the half million or fewer categories, Athens (Europe) won the first place to 11 in 2009, and Rockford (North America) moved to the place, compared with the last seven years. Total Nagoya is the highest in Asia and the Middle East.

A Significant improvements of airlines from 2009 to 2010, the immediate Southwest Airlines' in the first place from 12th to ninth place in the second FedEx Express, Nippon Cargo Airlines to fifth place from the 30th and Japan Airlines, 22 sessions.

Japan airlines Ends Cargo Operation with Yusen KK

Admin Dept — Tue, 02 Mar 2010 04:58:44 GMT

Japan Airlines Corp and Nippon Yusen KK, the largest shipping company in Japan said Tuesday it has decided to enter talks to end cargo operations, when the plan failed after the carrier filed for bankruptcy will be in January.

The decision is nearby the subject JAL to reduce significantly the loss of view is that the air cargo operations, including the possible lifting of the cargo flight under the rule led by rehabilitation.

JAL does not seem to even out the differences in the merger after the government sponsored enterprises such relief initiative of Japan, which sponsors the restoration efforts, called for major changes in how the load because it is sensitive to changes in economic conditions.

The decision could also choose to JAL's efforts to prepare and submit a plan for the rehabilitation of the Tokyo District Court in late June

The two parties,''a friendly negotiations, because the structure of merger must be organized under Abkommens''zwischen the two companies have reached an end, said in a statement.

The carrier has negotiated and Nippon Cargo Airlines Co, Nippon Yusen cargo unit Air, had since August last year to merge their shipping operations around April this year.

JAL originally introduced the charge and spin-related activity accounts for about one third of the ANC Carrier Integrated Cargo.

The statement said the two companies for existing relationships, including the further operation of cargo flights as part of an agreement to codeshare.

The turnover of JAL cargo handling operations, have the peak in 2006 of tax 239.4 billion yen to 199.8 billion yen for fiscal 2008 decreased due to the impact of global economic slowdown. The company also recorded operating losses of approximately 20 billion yen in the part of the load for the year to March 2009.

Cathy-Air China Merge

Admin Dept — Mon, 01 Mar 2010 07:59:34 GMT

Cathay Pacific and Air China have agreed to use part of handling them, which will merge with the purchase of 49% of Air China Cargo (ACC) of Cathay.

In a complex case, Air China Cargo, a subsidiary of Air China to stay, another important contribution to the book value of investments Cathay Pacific to 1.6 billion RMB. This is done as a framework agreement on February 25 described, although the agreement still requires approval from competition authorities.

The rationale behind the agreement seems to be able to access the global network of Air China and Cathay in cargo logistics infrastructure in Hong Kong. In turn, the Air China, Cathay will provide access to the markets of Shanghai and the Yangtze Delta. New Active Air China Cargo will sell capacity in the belly of cargo and air cargo in China, but apparently not by Cathay Pacific. In fact, the cargo of Cathay Pacific will continue to compete with the China Air Cargo.

Christopher Pratt, chairman of Cathay Pacific, said: The joint venture will help carriers of the two most important assets producing areas of the mainland, with two very competitive and efficient at home airline Cathay Pacific in Pearl River Delta and Yangtze Delta district at the ACC. Since a large house haulage with one foot in the company River Delta Yangtze, the ACC is able to ensure the efficient movement of goods, which are distracting to other platforms rival in the region. It is reasonable to Cathay Pacific and Air China Group for this joint venture. The two companies have entered into a strategic alliance since 2006, when it organized the purchase of shares, while Cross Cathay, Dragonair, a company based in Hong Kong, which serves most of the rest of China.

AIR CARGO 2010 in Orlando in March

Admin Dept — Mon, 01 Mar 2010 05:11:43 GMT

The organizers expect 800 participants and 100 exhibitors and sponsors will be the successful marketing techniques, compliance with domestic supply chains and global and discuss how the burden of 100 per cent for the control in August to predict.

The presentations will include a summary of the TSA inspection requirements for cargo, Terry Jones to adapt to new techniques for the success of the brand, marketing and managing customer relationships, Brian Clancy Merge on the state of the global aviation industry freight, and future projections to ensure compliance with the requirements of managing the supply chain Lenok WWA Neil, Leigh Kirby unlimited prospects in social networks and increase sales, and Bob Reilly GovPro Partnership for how companies can benefit from trade with the U.S..

To know more about this conference please visits the web site www.aircargoconference.com.

Dubai Airports skipped two levels to be higher

Admin Dept — Mon, 01 Mar 2010 05:07:24 GMT

Dubai International Airport

Dubai Airports skipped two levels to be higher, the fifth largest cargo handling, compared with 5.6 percent increase in air cargo in 2009.

Memphis International Airport is the largest cargo airport in the world for 18 years, especially in Hong Kong and Shanghai.

Although the Airports Council International (ACI) index of 15 February will be updated to continue to make Dubai airport, covered in seventh place in the cargo during the last 12 months based in late November 2009, the emirate has been a significant step in the past two months witnessed the movement of two points.

Dubai Airports announced last week that the movement of cargo and passenger ships on the rise. Load recorded the fourth consecutive month of double-digit growth in cargo volume rose 31.5 percent.

Dubai Airport Cargo handled 171,453 tons of cargo in January 2010, compared with 130,375 tonnes during the same month of 2009.

The sharp increase in the volume of goods in January is the result of increased economic activity and the continued expansion of Emirates SkyCargo, which contributed to 39.9 per cent increase in transhipment, an increase of 33.6 per percent of exports and 29.3 percent increase in imports, said a statement from Dubai International Airport.

Meanwhile, global growth in air transport in recent months to December alone, registering 23 percent in December, according to the International Air Transport Association (IATA).

Memphis International handled 698.5 million pounds of cargo, up 5.9 percent from 659.6 million in January 2009. The authority also reported U.S. $ 1.61 million (Dh5.91m) income transfer territory in January, 5.9 percent, compared with $ 1.52 in January 2009.

In Hong Kong airport, which occupies the second position, cargo traffic increased by 43.3 years per annum 301,000 for tonnes in January. This led to an increased demand for air freight in a year the 55 percent annual increase in imports and 51 per cent increase in exports during the month.

Abu Dhabi Airports Company (ADAC) last week published a report in January 2010 and said the burden was a significant recovery, up 25.6 percent over the same period last year.

Total load was 10.1 percent in 2009. However, it expects a slight improvement from IATA is 7.7 percent in 2010, while the total volume of cargo to remain 10 percent below the peak of 41.8 million tonnes in 2007, although the load demand is somewhat faster than world trade as companies seek to replenish stocks again. Yields affected, 15 per cent last year. It should be expected to increase only 0.9 percent in 2010, IATA said the recent statement.

Middle East is the only region that has seen growth in 2009. According to ACI statistics, air cargo traffic in the region grew by 4.9 percent in 2009. Dubai International Airport, however, was carrying out regional development increased by 5.6 percent.

Cathy Pacific & Air China May share the load

Admin Dept — Mon, 01 Mar 2010 05:04:41 GMT

Air China and Cathay Pacific, Hong Kong, the airline and the largest operator, seems to enter into a joint venture cargo airline. The Air China is seven cargo flights, while Cathay, refers to the application is to create five or six aircraft.

The talks began in 2006, focuses on more than one contract Cathays most important acquisition Airlines Hong Kong Dragon

Air transport will continue to rebound

Admin Dept — Mon, 01 Mar 2010 05:01:55 GMT

The Association of Asia Pacific Airlines said air transport continue to rebound since last quarter.

The organization of member companies showed an increase of 33.1 percent over the previous year were recorded in terms of freight tonne kilometers (FTK) in January.

The average capacity of international air cargo carriers in Asia Pacific in January, 12.6 percent more than in 2008 to 66.4 percent.

The airlines shall Peat handles about 40 percent of global air cargo annually.

After two difficult years, first indications are very encouraging for the year 2010, CEO Andrew Herdman said Peat International charter Weekly.

FNC Logo on Freightworld.com

Admin Dept — Thu, 25 Feb 2010 06:43:46 GMT

Now FNC logo on Freight World website.

View Freight Network Corproation Logo on Freightnet

Admin Dept — Thu, 25 Feb 2010 06:09:26 GMT

FNC logo on Freightnet Directory Home page.Advertisement combine to popularize the Logo.

Newsletter January

Admin Dept — Thu, 21 Jan 2010 06:01:54 GMT

Happy New Year and best wishes from www.fnc-group.com.

There are plenty of positive notes and result in this fresh year. US airline says Air cargo demand is up for first time since '08.U.S. airlines posted their first month of cargo traffic growth in November since July, 2008..Another news from Japan, Japan's second-largest air carrier All Nippon Airways said its international cargo volume grew for the third consecutive month in November on a year-on-year. Next from China, A ir China said the 220 million funding is to go toward a larger share of the Air China Cargo joint venture. Air China, which ranked as the world's 15th largest cargo. All these news expect new hopes to the industry.

Etihad to operate relief cargo flight to Haiti

Etihad Crystal Cargo will operate a special Red Crescent and Khalifa Welfare Foundation charter flight to Haiti on Wednesday 20 January, carrying medical and humanitarian supplies to the earthquake hit country.

The MD11 aircraft, which will use its full capacity of 88 tonnes, will fly first to Casablanca and then onto Santo Domingo in the Dominican Republic. The cargo will be unloaded there and taken to neighbouring Haiti.

The charter flight is part of the “Care By Air” initiative, founded by Maximus Air Cargo, Etihad Airways and Abu Dhabi Airport Services, which provides cargo space ‘at cost’ to deliver relief aid to disaster-stricken areas around the world.

Editor's note : Any one interested to offer a free charity logistic services to Haiti same can be published in our website/newsltter.Interested logistic provider please email us admin@fncmail.com

Ransom paid for oil tanker, Somalia pirates feud

The largest ransom ever paid to Somali pirates was dropped on Sunday onto a Greek-flagged oil tanker with two million barrels of oil on board, pirates and maritime officials said.

An aircraft dropped a ransom believed to be between $5.5 million and $7 million for the release of the tanker which was hijacked near the Indian Ocean archipelago of the Seychelles, the officials said.

The Maran Centaurus was seized on November 29 with nine Greeks, two Ukrainians, one Romanian and 16 Filipinos on board and the ransom dwarfs amounts paid previously for vessels held captive by Somali sea gangs.

Diana Shipping to invest in new containership project

Diana Shipping is planning to participate in a new project involving the formation of a company expected to invest in containerships over the next 12 to 18 months. The company intends to invest $50 million for a minority stake in the project, with the balance being raised in a private offering to institutional and accredited investors.

Diana Shipping's wholly-owned management company will also enter into administrative and vessel management agreements with the new company, and certain Diana Shipping executives would also hold positions as executives of the new company

www.fnc-group.com is one of the leading Logistic and freight forwarding network presently having many reputed freight and shipping companies from various coutries.FNC welcome Project Handlers, Removal and Freight forwarding companies to become official member of network. Please visit our website www.fnc-group.com

We hope that you enjoy this newsletter and that it helps you to get more out of your website. Please pass this newsletter on to your friends.

Best regards,

Tina Florian / Editor

FNC GROUP

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Air cargo Falls 12.7% in Europe

Admin Dept — Sat, 02 Jan 2010 01:44:54 GMT

The European Airline association said in October falls 12.7% of Air cargo Tariff. And Middle East traffic improved 30% in October. Still the Asian traffic from Europe in not up to the market. The traffic is dawn 20.9 % down comparing to last year same month statistics.

According to AEA traffic of Atlantic routes are slightly better small route of mid Atlantic slightly improved by 4.9%

Last 2 months (peak season) reports are still not available.

MANDATORY ISF PROCEDURE ON YOUR OCEAN IMPORT CARGO TO USA

Admin Dept — Fri, 01 Jan 2010 06:55:45 GMT

Further to the ISF (10+2 ) message, this is to Alert that ISF filing streamline deadline is ahead of month (Effective - 26th Jan'10).
We need to start the ISF procedures with immediate effect to avoid last minute rush...

ISF filing is mandatory for all In-Bound shipments into USA hence we need to insist the same to all Shippers to start doing it like AMS filing.

The mandatory ISF (“10+2”) will be enforced with Liquidated Damages Penalty ($5,000 per violation) by U.S. Customs as of Jan 26, 2010 for ALL USA IMPORTERS.

Soonest Express Inc can file the 10+2 info on behalf of ALL importers upon request.

ISF FILING FEE IS $50 PER ENTRY

ISF SINGLE BOND FEE IS $150 PER ENTRY

** ( If importer does not have Customs Annual Bond, each importer is only allowed to purchase this ISF Bond five-times, only, please be awarded that this Single ISF Bond is NOT cover the regular Single Entry Bond you normally purchase for every entry. In other words – yes, you need Single ISF Bond and Single Entry Bond if you do not have Customs annual Bond)

All agent please make a note of it and do the proper co ordination with respective agent/consginee/shipper.Still more assistace please do contact our US agents for more details

United States, Japan on Course to Liberalize Air Services

Admin Dept — Wed, 23 Dec 2009 06:28:39 GMT

The United States and Japan have reached agreement on liberalizing air services between the two countries, paving the way for cross-border airline alliances and more choices for passengers.

The two sides initialed an open skies agreement December 11 after seven months of negotiations.

“Achieving open skies with Japan, a major U.S. transportation and trade partner, has been a long-standing U.S. goal and is good news for air travelers and businesses on both sides of the Pacific,” said U.S. Transportation Secretary Ray LaHood.

Bilateral open skies agreements give airlines in both countries the right to operate air services from any point in one country to any point in the other, as well as to connect those flights to points in third countries.

Copenhagen Agreement Step in Right Direction - IATA

Admin Dept — Wed, 23 Dec 2009 06:23:39 GMT

The International Air Transport Association (IATA) welcomed the Copenhagen Accord as an important step in the right direction for climate change. Aviation emissions were not addressed specifically in the Accord, a reflection of the pro-active measures the industry has taken to set challenging targets for itself, together with an aggressive strategy to achieve them. The industry will continue to work towards achieving these global targets, which were recognized by the member states of the International Civil Aviation Organization (ICAO) at its High Level Meeting on Environment in October 2009 and which were commended by UN Secretary General Ban Ki-moon at a meeting with Giovanni Bisignani, IATA’s Director General and CEO, in New York later that month. IATA will continue to work with ICAO to develop a global framework for managing aviations emissions.

“We came to Copenhagen to be part of the deal and we were encouraged by the level of support for the industry’s global sectoral approach and targets. We will continue to press states to include these global targets in any future deal,” said Bisignani. “Airlines, airports, air navigation service providers and manufacturers are reinforced in their commitment (1) to improve fuel efficiency by an average of 1.5% per year to 2020, (2) to stabilize carbon emissions from 2020 with carbon-neutral growth, and (3) to a net reduction in carbon emissions of 50% by 2050 compared to 2005,” he added.

Bisignani said, “We also found consensus among the delegations that a global sectoral approach should be established for aviation emissions by ICAO, the UN’s specialized agency for aviation. We will work closely with ICAO to prepare a global framework for managing aviation’s emissions for the ICAO Assembly to consider in September 2010. And we will urge governments to ensure this framework is presented to COP16 in December 2010. In the meantime we continue to urge governments to avoid creating a patchwork of national and regional solutions and to ensure aviation’s emissions are dealt with as a sector and across the world. A global sectoral approach supported by tough targets is the only sensible way forward for a global industry.”

A Global Sectoral Approach, under ICAO, to manage aviation’s emissions will ensure a level playing field. The approach consists of three main elements:

Full accounting for aviation’s emissions as a global industrial sector, not by state.
Global coordination of economic measures to ensure that aviation will not pay more than once for its emissions
Full access to global carbon markets

The aviation industry is already working towards its climate change goals through its four pillar strategy. The strategy focuses on investing in new technology, flying smarter, building efficient infrastructure, and taking advantage of positive economic measures.

Lufthansa: Crisis in the industry burdens economic result

Admin Dept — Fri, 31 Jul 2009 02:29:13 GMT

Lufthansa has posted an operating profit of eight million euros for the first six months of 2009. The Group has therefore not been able to match the good results of the previous years during the current business year. The causes for the decline in earnings lie in the economy-related weaker demand and the altered travel behaviour of the passengers. Business travellers in particular, have increasingly been buying tickets in the cheaper booking classes, leading to a significant slide in average yields during the first half of the year. “Lufthansa has made provisions and is holding its course against the competition in highly challenging conditions. This is a strong performance by all of the employees in the Group; however, we still cannot be satisfied with this result”, commented Member of the Executive Board of Deutsche Lufthansa AG and Chief Financial Officer Stephan Gemkow, speaking at the presentation of the first-half results.

Chairman of the Executive Board and Chief Executive Officer of Deutsche Lufthansa AG Wolfgang Mayrhuber commented on the economic developments in the Group’s individual business segments saying: “The figures speak for themselves. Crises ruthlessly reveal the weak points and we shall act. It is only sustainable structures that will allow our company to match its past successes and succeed against the competition in the long-term.” During the first half of 2009, the Passenger Airline Group in particular had to deal with the economy-related decline in demand and achieved significantly lower traffic revenues. The operating result was therefore below the figure for the previous year. In response to the negative trend in its core business segment, Lufthansa has launched “CLIMB 2011”, a program to safeguard the earnings of Lufthansa Passenger Airlines. The aim is the sustainable improvement of the result for Lufthansa Passenger Airlines by one billion euros by the end of 2011; thereby, the focus will lie on cutting costs. According to Gemkow, the measures of the program would be elaborated and implemented during the upcoming weeks. The Logistics business segment also showed a significant slump in revenue and loss in the operating result during the first six months of the year, and consequently intensified the measures to safeguard earnings. Among others, the measures included the reduction of cargo capacity by 30 per cent and the increase of short-time work to 25 per cent in the business segment during the second quarter. MRO was the only business segment to record an increase in revenue despite the highly challenging conditions. However, the operating result was lower than in the same period the previous year: This was mainly due to increasing price pressure, reserves for bad debt and foreign exchange losses due to the record date effect in inventory valuation. The measures to safeguard earnings were also intensified in the IT-Services business segment. Lowering the number of external staff by half, time off in lieu and reducing the administrative costs by 30 per cent are all measures aimed at counteracting the slump in revenue and the operating result. Revenue and profits also slumped in the Catering business segment. The “Performance 2009“ and “Upgradeplus” programs aim to secure an operating profit for the current business year and ensure the set up of a sustainably competitive company structure.

“Lufthansa is a strong company and Lufthansa and SWISS belong to the best airlines in the world. We are fully determined to remain the best – also in a time of crisis and in significantly changing competition. We are acting now in order to ensure success”, stressed Stephan Gemkow. He went on to add that the Group was continuing to operate in a challenging environment that could also lead to expect a significant decline in revenue for the full year 2009. Despite these challenging conditions and the burdening effect of the new airlines on the result of the Group, its activities had continued to target an operating profit for the current business year. Gemkow however pointed out that achieving this target would require the timely implementation of the planned additional measures to safeguard earnings and would be accompanied by major risks, particularly in the form of the further development of demand and fuel prices.

First-half figures 2009

During the first six months of 2009, the Lufthansa Group generated revenues totalling 10.2 billion euros, 15.2 per cent less than the year before. The traffic revenue fell by 19.3 per cent to 7.8 billion euros. This was mainly due to the decline in passenger and freight figures, as well as lower average yields per passenger. Overall, the operating income of the Group decreased by 10.1 per cent to 11.6 billion euros during the reporting period.

Operating expenses decreased by 4.8 per cent to 11.6 billion euros during the first half of 2009. This was mainly due to the 897 million euros lower fuel costs; equivalent to a year-on-year reduction of 36.6 per cent, which was both price and volume related. The fees and charges were 2.5 per cent below the previous year’s figure.

The Group’s operating result during the first six months of the year was eight million euros, which was 669 million euros less than during the same period last year. The decline is mainly the result of the negative developments in the Group’s Passenger Airline Group and Logistics business segments. The company’s net profit is -216 million euros; this time last year it was at 381 million euros.

Lufthansa’s capital expenditure during the reporting period totalled 1.2 billion euros, of which 898 million euros were spent on the expansion and modernization of the fleet. 77 million euros were gained from the disposal of the remaining Condor shares and the repayment of related loans. Operating cash flow totalled one billion euros. At the close of the first half, the Group's net indebtedness stood at 396 million euros.