United Airlines and Lufthansa to partner in international cargo operations

United Airlines (UAL) and Lufthansa Cargo have signed a joint venture agreement for extensive cargo cooperation on routes between the U.S. and Europe.

The contract signing initiates the implementation phase of the joint venture project, during which the carriers will align their cargo IT systems and business processes with the goal to implement Business Day 1 later this year.

The announcement comes in the wake of a major move by Lufthansa earlier this year to eleminate hundreds of management level positions to cut payroll costs.

According to spokesmen, the cargo joint venture partners plan to provide a wide range of benefits to shippers by cooperating on the availability of their capacity and aligning booking and handling processes.

Ideally, the carriers’ joint venture route network will provide greater flexibility and time savings for shippers with thousands of new route combinations and more than 600 direct connections per week between the U.S. and Europe.

If successful, the combined network offering may create additional benefits through access from either partner’s booking channels along with coordinated handling processes and transfers at numerous stations, said spokesmen for both airlines. 

Chuck Clowdis, managing director of transportation advisory for IHS Global Insight, told LM that the deal may “simplify” cargo bookings for U.S. logistics managers.

“Time will tell how the rate structures and seamless tracking can be implemented,” he said. “A competitive service that makes for enhanced efficiencies along the Supply Chain typically results is success for shippers and receivers alike…and if course the carrier(s) involved.”