Monday, November 19, 2012

Freight Only Airline Cargolux Lose Qatari Support

Luxembourg Carrier Restructures for Future
Shipping News Feature

LUXEMBOURG – QATAR – Just eighteen months after acquiring a 35% holding in freight only air carrier Cargolux for an undisclosed sum Qatar Airways has today confirmed it will be disposing of its holding in the European airline. Albert Wildgen, who joined the Cargolux Board of Directors three months after the original deal in September 2011, also announced his decision to step down from his post as Chairman at the next meeting of the Board of Directors on 30 November 2012.

The Luxembourg based air carrier has had a chequered history of late and has faced, along with many other cargo airlines, legal assaults and huge financial penalties for anti trust activities in countries from South Korea, New Zealand and Australia to South Africa and Europe. In December 2011 two executives, including the former president and CEO plus a senior marketing VP, were jailed for thirteen months each following guilty pleas to cartel activity in the United States.

The original Qatari deal was lauded by executives from both airlines as a sound partnership between two leading industry lights with the potential to increase the Middle Eastern airline's foothold in the air cargo market between Europe’s leading freight only carrier and ‘the fastest growing airline in the world’.

Cargolux issued a statement today saying that its shareholders (passenger airline Luxair and Luxembourg state owned banks BCCE and SNCI):

“…have confirmed their full confidence and support of Richard Forson, the interim President and Chief Executive Officer, and his management team as they take the airline forward through this difficult phase of restructuring in order to position Cargolux for future growth and prosperity benefiting not only the air logistics industry, but the country as a whole. There are many significant challenges facing Cargolux and the shareholders remain committed to implementing those actions that will ensure it long term sustainability.”

Editors Note:

Following publication of this story we have been advised by the ITF (International Transport Workers’ Federation) that it was in fact union pressure which led to the withdrawal of Qatar Airways following demonstrations by its member union, the OGBL (Onofhängege Gewerkschaftsbond Lëtzebuerg).

The union believes that the Middle Eastern airline was seeking a controlling interest in Cargolux which it felt would mean the potential loss of ‘thousands of jobs’. On the 13th November OGBL held a demonstration against the increase in shareholdings by the Qatari’s leading to a statement from the union’s spokesperson on aviation affairs, Hubert Hollerich, which said:

“The OGBL is opposed to selling off one of the jewels of the Luxembourg economy to a state that does not know the concept of parliament, trade unions, social dialogue and democracy.”

Among the arguments presented to the government in Luxembourg against a Qatari takeover was a formal complaint that the ITUC (International Trade Union Confederation) presented to the ILO (International Labour Organization) denouncing serious breaches in international labour conventions in Qatar. The ITUC is developing a campaign against these violations ahead of the 2022 Football World Cup, which is due to be held in the country.