SAUDIA Cargo believes further yield pressure and belly cargo capacity additions will be the main challenges faced by the air cargo industry in 2016, reports London's Air Cargo News.
“For us as a true air cargo operator and running 16 freighters, the main challenge is the yield development," said Saudia Cargo vice president Rainer Mueller.
“We still expect further pressure on yields. But you can develop your own strategy to deal with. In the end, we have the number one freighter fleet in the Middle East," he said.
“From my point of view, the passenger growth especially on the bellies is higher than the air cargo growth. That in the end has an impact on the yields and that also impacts the freighter programme," Mr Mueller said.
“So you will see a growth on the bellies but when it comes to freighter operation, in the long term there is a question mark whether we will see growth in that sector as well," he said.
To meet the challenge, Saudia Cargo has been developing specialisations in certain products, such as its pharma offering, which was created in 2014.
At present it is concentrating on pharma imports in Saudi Arabia, which has a population of 30 million, and is looking to develop temperature controlled facilities in the country.
Source : HKSG.