‘We were too ambitious and tried to be too global’ says Etihad executive
Etihad Cargo tried in the past to be too global and was too ambitious, according to Abdulla Mohamed Shadid who joined as managing director cargo and logistics at Etihad Aviation Group a year ago.
Speaking to Air Cargo News, he said changing market conditions several years ago revealed that the airline had concentrated too much on creating a global footprint and not enough on developing other key areas of the business such as the technology, which customers are demanding to improve business processes.
“Abu Dhabi is right in the middle of the Europe – Asia corridor, the world’s busiest trade lane,” he explains. “In the past, we may have been overly ambitious and tried to be too global. Now it is more about choosing the trade lanes we can be competitive in.”
Abdulla Mohamed Shadid, managing director cargo and logistics at Etihad Aviation Group
Etihad exited its A330F fleet last year and now operates B777Fs which are flying mainly to core markets such as Europe and Asia (eg India, Vietnam and China), complementing the bellyhold capacity that feeds over 90 destinations including North America, Africa and Australia.
With reduced capacity effectively helping Etihad eliminate “bad revenue”, the smaller footprint has allowed Etihad to refocus and fine-tune the network, and this allowed it to open up Singapore as a new route and increase Shanghai frequencies.
“We need to be conscious of the ecosystem we are in, where there is industry overcapacity,” says Shadid. “That is why we right-sized our fleet, and today are confident that we have sufficient capacity to meet our needs for the foreseeable future.”
“We are maintaining our fair share with key customers – if we are not doing that, we are doing something wrong. If you operate transparently with customers, there is no reason why they would leave.”
This transparency and communication with customers has been greatly enhanced by the introduction of Etihad Cargo’s new technology platform, IBS iCargo, last October.
“The change has been like a switch between night and day. In a short span of time, we have probably become more digitised than most other airlines of our size. Only a handful have managed to do more than we have – in a few years we aspire to be ahead of the rest,” claims Shadid.
“We are investing heavily to offer customers a differentiated service – from live quotes to knowing the exact temperature of their product at any point in the journey.”
He says 22% of the business went online in the first six months after the launch of etihadcargo.com.
“Another channel is to link via API’s into our forwarders’ systems which will digitise another 40-50% of the business. We have run very successful pilots with DHL Express and DB Schenker, so between this and our online offering we expect to have about 70-75% of our bookings through these new distribution channels by the end of the year. No other airline does that.”