Record losses for Air France’s KLM Cargo Division

2016 saw a record loss for the cargo division of the Air France KLM group.

The French-Dutch airline recorded a full-year operating loss of €244m, compared with a €245m loss in 2015. This was a 14% year on year decline as a result of structural industry overcapacity and a decline in traffic of 6.3% to 8.4bn revenue tonne km (RTK). Its full-freighter operating loss for the year was €28m, compared with a €42m loss in 2015. According to KLM “The group continued to restructure its cargo activity resulting in its gradual turnaround, in order to address the weak global trade and structural industry overcapacity, and to maximise its contribution to the group,” Looking at fourth quarter results, revenues declined by 10.8% year on year to €546m and its operating loss sank to €28m from a loss of €23m during the fourth quarter of last year. Fourth quarter traffic was down 3.9% year on year to 2.2bn RTK. The average cargo load factor for the 2016 period stood at 63.2%, which was the same level as a year earlier. From 2017, AF-KLM will be merging the reporting of its cargo business into its overall financial and passenger results to reassess its performance. Previous years have seen the company drastically decrease the size of its freighter fleet as it tries to bring down the overall heavy losses under previous calculation methods.