x Abu Dhabi, UAESunday 21 January 2018

Qatar Airways buys 35% stake in Luxembourg's Cargolux

The Doha carrier's 35 per cent purchase of Cargolux is part of a "strategic equity and commercial partnership", the airline said this week.

Qatar Airways has bought a major stake in the Luxembourg cargo airline Cargolux in a deal that will also see the two airlines integrate their operations.

The Doha carrier's 35 per cent purchase of Cargolux is part of a "strategic equity and commercial partnership", the airline said this week, and comes on the heels of the carrier's recently announced plans to dramatically build up its fleet of dedicated cargo planes to serve the growing Asia to Europe market.

Financial terms of the deal were not disclosed.

"Our investment in Cargolux, a sound, healthy and profitable company and a leading all-cargo carrier, will deliver great value to Qatar Airways proving to be an excellent strategic partnership," said Akbar al Baker, the chief executive of Qatar Airways.

"We look forward to strengthening our Doha hub with greater freighter operations that will see Cargolux in the not too distant future serve Doha, to create synergies with Qatar Airways Cargo and our freight business on Qatar Airways' passenger flights."

The agreement was signed in Luxembourg on Thursday by Mr al Baker and the Cargolux president and chief executive Frank Reimen, in the presence of Qatar's prime minister and the Luxembourg minister of finance.

The Qatari carrier is also considering a plan to retire up to 15 Airbus A330 wide-bodied passenger aircraft. These would be converted into cargo carriers by ripping out the seats to make room for freight containers, and allow the airline to retire some of its five older Airbus A300 freight aircraft.

Mr al Baker said the final figure to be converted, and the timing, depended on slot availability at the Airbus freighter conversion centre in Germany.

"We seek to fuel our growth plans by further developing our air freight business as a major part of our overall product offering and develop Qatar as a leading global cargo hub and one of the major players in the international freight market by 2015," he said.

Qatar Airways is one of the world's fastest growing airlines and operates a fleet of 98 jets with an additional 200 on order.

Cargolux operates a fleet of 16 Boeing 747 cargo carriers flying to more than 90 destinations. It will be the launch customer of Boeing's next generation wide body 747-8 Freighters with 13 of these aircraft on order.

The European aircraft manufacturer Airbus said it is in discussions with Qatar Airways for further orders including A380 superjumbos and the A320neo, a re-engined, more fuel-efficient version of the top-selling A320, with some analysts expecting deals to be announced as early as the Paris Air Show later this month.

Officials from Airbus and its parent company EADS have been making optimistic comments about prospects for order announcements in the coming weeks.

The Airbus chief executive Tom Enders has said he expects this year's crop to be even larger than the hundreds of orders bagged at last year's air show at Farnborough, England. The most important annual trade shows for commercial aircraft builders alternates between Farnborough and Paris.

Airbus has said it expects to deliver between 520 and 530 aircraft this year, and that gross orders should exceed this figure.

The thin order intake in May appears to suggest that Airbus is holding back some order announcements for the Paris Air Show that starts on June 20, industry observers said.

Executives of Airbus and its parent company have said they expect the order book for the A320neo will top 500 by the end of the air show, compared to 332 at present, including 130 firm orders.