Air China Cargo (ACC) is moving to up its game, targeting juicier yields from premium services but also the general freight segment with a more differentiated offering. On January 1, the carrier will commence the roll-out of its revised product portfolio. This will mark the first phase of a broad revamp of service parameters and product definitions that has been in the works over the past 12 months.
The new service levels are benchmarked against product definitions of major international airlines, according to Titus Diu, the carrier’s COO. The product upgrades have been developed on the back of ACC’s new IT platform, which was brought in a year ago.
“With the new system we can base products on Cargo 2000 standards,” said Diu. “It took us a while to get familiar with the new operating system to lay the foundation for the new products.” Management has also been busy with the transition of the fleet from an all-747 freighter line-up to 777s and the introduction of four B757-200Fs into the mix.
“In the first phase, we will introduce our new products of a time-sensitive character,” said Diu.
At the apex of this segment will be ACC’s express product. One rung down, the standards and features of its general airfreight service have been re-defined to constitute a distinct product, with another service level added below.
“We will introduce a product below general airfreight with more flexibility on the airport-to-airport aspect. This will have a lower rate than general cargo if we get a longer timeframe to move the shipment to the destination airport,” said Diu.
At the same time ACC has upgraded its service levels for three brackets that feature special handling. January will see the unveiling of new products for dangerous goods, perishables and horses.
In a second phase, management is going to focus on pharmaceuticals and cold chain products. “We are already preparing to get approval for special containers like Envirotainer units that have active temperature control capability,” said Diu. “They have not been approved yet by the civil aviation authority in China.”
At this point he has no clear timeline for the implementation of the second phase of the product revamp.
ACC, a joint venture between Air China and Cathay Pacific, operates a fleet of 777 and 747 freighters and markets the bellyhold capacity of its Chinese parent.
Diu would certainly welcome higher yields from his revamped service portfolio. ACC’s cargo volume has improved in the first nine months of this year, but yields have been under pressure.
“We are on track in terms of volume, but it all depends on market rates,” he said. “It is still challenging for freighter operators.”
By Ian Putzger
Air Freight Correspondent | Toronto