UK-based maindeck operator CargoLogicAir (CLA) has called it a day, perhaps an early victim of the ongoing coronavirus outbreak that, on top of persisting financial problems for the carrier, proved one big problem too many.
Rumours had been swirling about the industry for days now, with the carrier confirming in a statement that it has reached the end of the runway.
“Due to the latest market development, specifically the drastic decrease of the market demand, CLA finds it extremely difficult to continue its commercial operations,” the UK-based all cargo carrier says in a statement.
CLA went on to say that its operations have been severely affected as “a significant portion” of its commercial activities were focused on the Chinese market.
The China market has been reeling for over a year now, as the trade war with the US weighed heavily, only to be followed by a tepid peak season. The traditional closure of factories during Chinese New Year was then exacerbated by the coronavirus outbreak which continues to stall factory openings and cargo movement in the country.
“As a result, a decision was made to suspend the flights. However, CLA continues to fulfil its contractual, financial and regulatory obligations. CLA is in close communication with the UK CAA in order to ensure the safe transition period.”
Last year the carrier announced that it would halve its freighter fleet from four to two B747Fs in what it said was a response to market conditions. Just last week CargoLogicAir sold one of its B747-400Fs (previously owned by the now-defunct German/Chinese carrier, Jade Cargo) to Cargolux.
The Volga-Dnepr Group, whose owner Alexei Isaikin operates five cargo airlines – including CargoLogicAir, Volga-Dnepr Airlines, AirbridgeCargo, Atran Airlines, and new licensed CargologicGermany – suffered significant losses during 2019.
Cargologicair posted 2018 revenues of GBP 213.7 million (EUR 253.58 million) with its net loss reaching GBP 18 million, up from 2017’s net loss of GBP 2.5 million.