News / Frankfurters fear the worst as ABC deal trundles on

By Alex Lennanehttp://www.blogger.com/profile/[email protected]

23/02/2012

They are jittery in Frankfurt. The news blackout on the AirBridge Cargo/ Air Cargo Germany story is making everyone nervous. Even Lufthansa Cargo, normally as cool as a cucumber and smooth as silk (in the PR department, anyway), seems unnaturally hesitant. And it certainly won’t be commenting today on whether it is, behind the scenes, lobbying the German CAA hard. Neither is it keen to talk about any concessions that may or may not be granted to airlines of either nationality in the forthcoming round of bilaterals between the EU and Russia, for which, apparently, there is yet more jostling. Is it rattled? Perhaps.

It is no secret that there is little love lost between LH and ABC, the two largest freighter operators out of Frankfurt. Lufthansa and the Russians have played cat and mouse for a while – although which is the cat, and which is the mouse is open for debate.

Air Cargo Germany continues to operate, albeit with fewer services perhaps than last year. But the financial pressure, surely, is mounting for a deal to be done. And, say sources, the signature for a 49% share in ACG is likely to be placed on a contract any day now – except it’s unlikely today, as it’s a bank holiday in Russia. (Defender of the Fatherland Day, since you ask.) The basic agreements have been, well, agreed.

But the silence is still deafening, says one source in Frankfurt. No one is talking – and in the meantime, those whose jobs may depend on one outcome – or the other – are fearing for their livelihoods. If ACG goes under – that’s jobs lost at HHN. If ABC buys it, will that be jobs lost at FRA? No one knows.

Either way, ABC is stepping up the pressure in Germany, opening a new station in Hannover in March (for flights to Beijing, apparently.) And it is keen to get those traffic rights to the US. But it’s difficult. ACG must remain majority German-owned.

Yet Mr Isaikin, who is ambitious for his carriers, is not known for minority shareholdings, and would have to do some fancy footwork – and still convince the German CAA that he doesn’t have effective control. One must assume that LH will be pointing this all out to the German CAA, in no uncertain terms. (The German CAA seems to be out of the office, too, incidentally.) But possibly too late.

Of course, there may be ways around it if ABC is in a creative mood. And it would certainly be worth doing. ACG has international crews, a maintenance facility at HHN, and traffic rights to the US. ABC has Alexey Isaikin.

So what if, just for example, Air Cargo Germany appointed ABC as its general sales agent? (Not a natural step in a national carrier’s home market.) Or, if ACG leased an aircraft from ABC and used its own crew, relieving the pressure on ABC’s Russian crews? It’s likely there are many ‘synergies’ to be found between the two carriers. But more than a 49% stake? Never. It’s as simple as ABCG.