ANNUAL REPORT 2011 - Kuehne + Nagel

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Report of the Business Units _ _ _ _ _ _ Airfreight
Airfreight: On course for growth despite strong headwinds
Kuehne + Nagel’s excellent performance in airfreight is based on its strong position in
growth markets, the expansion of its industry-specific solutions and intensified sales
efforts. In 2011, the company increased its tonnage by 13 per cent in a contracting market.
Development of market and rates
The global airfreight market experienced a divergent development
in 2011. A strong first quarter was quickly followed by a
downward trend which became more accentuated in the following
months. Volumes in the fourth quarter were 2.5 per cent
lower than in the previous year’s period. In particular, Asia, the
growth engine for airfreight exports in the past years, began to
clearly splutter. As a result of the restrained consumer demand
in the U.S.A and large parts of Europe, the “peak season” failed
to materialise.
The volume decline was accompanied by falling rates in almost
all trades and the airlines’ concurrent deployment of new capacity
did not ease this situation. In addition, the even-faster spiralling
of the oil price due to the political unrest in the Middle
East also presented serious problems for the airlines.
Development of Kuehne + Nagel’s airfreight business
Kuehne + Nagel increased its tonnage on almost all routes and
achieved a new volume record by handling 1,073 million tons of
airfreight. Particularly strong growth was achieved in exports
from North America to Europe and South America and on the
trade lanes from Europe to North America and Asia. The fall in
demand in Asia did also affect Kuehne + Nagel’s activities;
freight volumes, particularly on the routes to Europe, considerably
declined in comparison with the previous year.
Strong growth in industry-specific solutions
In 2011, the portfolio of industry-specific airfreight solutions
again proved to be a significant factor for success. Kuehne +
Nagel concentrated on developing tailor-made services for specif-
ic segments such as the automotive and pharmaceutical industry
and for high-value consumer and perishable goods, which bring
benefits for customers in terms of quality, offer high transparency
and are also cost-efficient. In addition, increased sales activities
contributed to the favourable business performance.
Perishables Logistics
The global expansion of perishables logistics for goods such as
flowers, fruit and vegetables is a significant element of the
Kuehne + Nagel growth strategy. In 2011, by the acquisition of
three companies specialising in logistics services for perishables,
namely Translago S.A.S. and Agencia de Aduanas Excelsia Ltda.
in Colombia and Mastertransport S.A. in Ecuador, Kuehne +
Nagel opened up two key South American markets for the
export of perishables and at the same time reinforced its position
in the regional airfreight market.
In Europe Kuehne + Nagel strengthened its activities in this
segment by the acquisition of the Dutch company J. van de Put
Fresh Cargo Handling. This company, which is domiciled at
Amsterdam Schipol airport, concentrates on logistics, customs
clearance, handling and added value services for perishables.
As a result of this transaction, Kuehne + Nagel is now able to
offer integrated door-to-door services for perishable goods from
a single source. In the first year the new members of the
Kuehne + Nagel Group already contributed 8 per cent to the
volume growth.
Pharma Logistics
A high-quality service is crucial for the pharmaceutical segment.
Today, in addition to shipment tracking and management via