Bloomberg Businessweek - USA (2020-12-07)

◼ BUSINESS

18

VACCINE: ALEX KRAUS/BLOOMBERG. GOLDSMITH: COURTESY COMPASS PATHWAYS. *FOR A SIX-MONTH

SHELF

LIFE.

● Thepandemichasvastlyreducedairlines’ DATA: COMPANY STATEMENTS

capacitytohaulfreight

FindingFlightsto

DeliverVaccines

ThecoronavirushasleftDeutscheLufthansaAG’s

passengerfleetflyingatjust25%capacity.But

ina setofcooledwarehousesonthefringesof

Frankfurt’sairport,a 20-membertaskforceis hard

atworkfiguringouthowthecarriercanmanage

thecomingboomina differentpartofitsbusiness:

airliftingmillionsofdosesofthevaccinesmeantto

endtheglobalpandemic.

Lufthansa,oneoftheworld’sbiggestcargo

carriers,beganplanninginAprilinanticipationof

theshotsthatAstraZeneca,Moderna,Pfizer,and

othersaredevelopinginrecordtime.Nowthatthe

drugmakersarestartingtoapplyforauthorization,

Lufthansa’staskforceis rushingtodevisewaysto

fitmoreofthecrucialpayloadontotheairline’s 15

Boeing 777 andMD-11freighters,alongwithhold

spaceinitspassengerjets.“Thequestionis how

wescaleit up,”saysThorstenBraun,wholeads

Lufthansa’spartintheglobaleffort.

Airlineswillbetheworkhorsesoftheattemptto

endthepandemic,haulingbillionsofvialstoevery

corneroftheglobe.It’sanunprecedentedtask,

mademoredifficultbythecarriers’diminishedstate

aftercullingjobs,routes,andaircrafttosurvivea cri-

sisthat’sreducedairtrafficgloballybyanestimated

61%thisyear.“Thiswillbethelargestandmost

complexlogisticalexerciseever,”saysAlexandrede

Juniac,chiefexecutiveofficeroftheInternational

AirTransportAssociation,theindustry’schieflobby.

“Theworldis countingonus.”

IATAestimatesthattheequivalentof8,000loads

ina 110-ton-capacityBoeing 747 freighterwillbe

neededfortheairlift,whichwilltaketwoyears

tosupplysome 14 billiondoses,oralmosttwofor

everyman,woman,andchildonEarth.It’sa tall

order,givenaboutone-thirdoftheglobalpassenger

fleet is still in storage, based on data from travel

analytics provider Cirium.

One of the biggest challenges will be finding

enough planes. There are some 2,000 dedicated

freighters in use, carrying about half of all goods

moved by air. The remainder of the freight typically

goes in the bellies of the world’s 22,000 passenger

jetliners. Air cargo volume has tumbled this year,

not for lack of demand, but because so many pas-

senger planes are sitting idle. Airlines have drafted

about 2,500 passenger planes into cargo-only roles,

but distributing the vaccine would be easier if fleets

were flying their usual schedules.

At the start, space will be limited because of

competing demand from merchants seeking to

deliver goods bought online during the Christmas

season. Then the sheer volume of vials from

attitude of big international brands is changing

significantly,” says Wu Wenmi, founder of Wenzihui

MCN, an agency in Hangzhou that partners with

Alibaba. “They are more humble now and willing

to hear our opinions of how to play the game.”

One way Chinese companies are playing the

game is with marketing that resonates for locals.

While foreigners’ ads stress the nutritional value of

their infant formula, Feihe nurtures relationships

with consumers via loyalty programs, new-parent

support groups, and collections of bedtime sto-

ries. And Chinese brands are increasingly tailor-

ing their wares to domestic tastes. China Mengniu

DairyCo.,forinstance,is steppingupsalesofinno-

vationssuchaspineapple-flavoredcheeseand

squid-infused snacks in addition to its lineup of

basic milk and fruit yogurts. “Foreign brands were

so innovative three decades ago when they first

cametoChina,”MengniuCEOLuMinfangsaidata

Novembermediabriefing.“Butnowthey’redevel-

opingslowerthanlocalbrands.”�BruceEinhorn

andDanielaWei

▼ Vaccine storage

temperature*

AstraZeneca

2C to 8C

Pfizer

-70C

Moderna

-20C

THE BOTTOM LINE Chinese brands account for seven of the

country’s top 10 cosmetics lines, up from three in 2017, while the

share of L’Oréal’s Maybelline makeup has plunged by half since 2010.

▲ A refrigerated

shipping container

in Lufthansa’s Cargo

Cool Center at

Frankfurt Airport

0C