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WORLD AIRPORTS .COM ACW Digital is sponsored by FREIGHTERS.COM
FREIGH
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The weekly newspaper for air cargo professionals Volume: 20
Issue: 39
2 October 2017
Alaska launches first 737-700 freighter conversion
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laska Air Cargo has introduced the first converted Boeing 737-700 Freighter to the marketplace – the first of its kind in the world. The aircraft entered commercial service for the first time last week carrying a payload of goods from Seattle to the state of Alaska. The aircraft was converted over 19 months in Tel Aviv by Israel Aerospace Industries and Alaska will take delivery of two more converted 737-700Fs allowing the new, all-cargo fleet to carry 15 per cent more capacity. Currently, Alaska operates one 737-400 Freighter and four 737-400 combi aircraft, which carry both passengers and cargo. Alaska plans to retire its entire 737-400 combi fleet by 18 October. Alaska Airlines vice president of airport operations and customer service, Wayne Newton says: “This one-of-a-kind aircraft marks the beginning of a new era at Alaska Airlines. With an all-freight fleet, our cargo business is now a stand-alone operation, allowing us to better focus on the needs of our cargo customers.” Alaska Air Cargo managing director, Jason
Berry adds: “The new freighter will transform our cargo business and allow us to provide more efficient and consistent service. “Now we can move more freight than ever before, and optimiae schedules to meet the needs of our cargo partners.” Initially, the new fleet of freighters will primarily serve the state of Alaska, and provide scheduled services to 17 communities across the state.
Independent of Alaska Airlines’ passenger operation, Alaska Air Cargo will provide more scheduled freight service than any other carrier in the state, and connect customers to 100 destinations across the airline’s route network. Alaska Air Cargo transports more than 170 million pounds of cargo annually, including seafood, mail and freight and operates the most extensive air cargo operation on the US West Coast of any passenger airline.
Qatar Airways has firmed up an order of two Boeing 747-8 Freighters and says it could place orders for more 747-8Fs in future. The fast-growing carrier also ordered four 777-300ERs and says the $2.16 billion valued order is a sign of its “continued expansion and contribution to the US economy,” and adds to its fleet of nearly 100 Boeing widebody aircraft and its more than 100 additional Boeing aircraft on order. The announcement was made at a delivery ceremony in Everett, Washington, where the airline also received the first of its 747-8F. Qatar Airways Group chief executive, Akbar Al Baker said at the event it had already sold its capacity on the first two aircraft and a second is set to join its fleet in November. Al Baker also says the carrier is seeing strong growth in tonnage, 160 per cent compared with the same period last year, due to the blockade placed upon Qatar by Saudi Arabia, Bahrain, Egypt and the United Arab Emirates.
Qatar Airways says the 747-8F gives cargo operators the lowest operating costs and best economics of any large freighter aircraft and provides greater revenue cargo-carrying capability than the 747-400, offering 16 per cent more cargo volume. Boeing Commercial Airplanes chief executive officer, Kevin McAllister adds: “It is heartening Qatar Airways has selected the 747-
8F to meet its growing cargo operations and to see the important role the 777-300ER continues to play in its long-haul fleet.” Qatar Airways Cargo is now the world’s third largest international cargo carrier, and serves 60 freighter destinations via its Doha International Airport hub utilising 200 aircraft. It’s fleet includes eight Airbus A330 Freighters and 12 Boeing 777 Freighters.
TONNAGE ON THE UP AND MORE TO COME FIRST SCHEDULED SERVICE PROVING POPULAR THE GOOD TIMES KEEP ROLLING FOR AIR LOGISTICS INVESTMENTS PAYING OFF FOR ECS AS IT EVOLVES
Qatar firms up order for two 747-8Fs and receives first one
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Court injunction sought ATLAS Air and Polar Air Cargo – subsidiaries of Atlas Air Worldwide Holdings – are seeking a preliminary court injunction to stop they say is an “illegal slowdown” of work by pilots. The injunction calls for the International Brotherhood of Teamsters, the International Brotherhood of Teamsters, Airline Division, and Local Union No. 1224 (IBT) – to meet obligations under the Railway Labor Act and “stop the illegal and intentional work slowdown and service interruptions they are causing”. Atlas’s request for a preliminary injunction was filed in the District of Columbia. In its filing, the company states the IBT is engaging in an “unlawful, concerted work slowdown” to gain advantage in pilot contract negotiations currently underway. The filing says the IBT has violated its status quo obligations under the RLA by encouraging the slowdown and failing to prevent it. Atlas is asking the Court to compel the IBT to stop the illegal work action and return to normal operations and it says customers have been notified of the steps it is taking to address the work slowdown. The company says the illegal work slowdown and service interruptions are “causing significant flight delays and harm to the company”.
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Valuable
vaccinations
4,000 tonnes of medicines and vaccines, worth ÂŁ2.1 billion were exported by air via Heathrow over 12 months, protecting the health and wellbeing of millions of people worldwide. Source: Seabury - Global Trade Database > UK Monthly (excludes EU27 & Transhipments); Nov 2015 to Oct 2016 (incl.)
Vaccines-tabloid-290x390mm.indd 1
05/09/2017 08:09
NEWS WEEK Another perishables acquisition for Panalpina
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analpina has acquired Dutch company Interfresh Airfreight Handling – which specialises in the Customs clearance and last-mile distribution of imported perishables from Africa, Asia-Pacific and Latin America. Panalpina will also takeover its sister companies Fresh Cargo Connection and Dutch Cargo Connection, subject to conditions. The parties reached an agreement on 27 September. Located at Amsterdam Airport Schiphol with offices, a cold storage facility and an experienced team, the three companies handle around 20,000 tonnes of perishables airfreight per year. Other important origin countries besides Kenya are Sri Lanka, South Korea, Taiwan, Canada, Ethiopia, Turkey, Colombia and Ecuador. The move follows the successful acquisition of Kenya-based forwarder Air Connection earlier this month, a specialised forwarder of flowers and vegetables while Panalpina also bought perishables forwarder Airflo in 2016 and grows its Perishables Network. Panalpina chief executive officer (CEO), Stefan Karlen says: “By acquiring Interfresh we gain full control over the cool chain for one of the perishables industry’s most important trade lanes for flowers – from Nairobi to Amsterdam and beyond. “It is also a logical transaction as the primary customer of
LUG owner takes over Hamburg handling firm THE Dettmer Group which owns LUG air cargo handling – has taken over the largest air cargo handling company at Hamburg Airport – Hamburg Air Cargo Handling Company (LHU). Due to the insolvency of its former owner, the Carl Tiedemann Group, LHU was facing financial difficulties, but with the change in ownership and continuation of the company and the employment of the staff are secure. The Dettmer Group says LUG aircargo
handling is active at Frankfurt and Munich airports, and is a “reliable and experienced partner” in cargo handling and the storage of air cargo and the addition of LHU, further broadens its presence in the German air cargo market. Dettmer Group owner and chief executive officer, Heiner Dettmer says the move will open new opportunities to raise volumes in Hamburg. LUG handled over 300,000 tonnes of in 2016 across Frankfurt and Munich airports.
Interfresh is Air Connection, the Kenya-based forwarder that we successfully acquired earlier this year.” The latest acquisition allows Panalpina to significantly expand its perishables offering in the Netherlands. Having its own fleet of vehicles, Interfresh specialises in the customs clearance and last-mile distribution of imported flowers from Kenya and different types of perishables from many origin countries in Asia-Pacific and Latin America. Fresh Cargo Connection acts as a fiscal representative for customers and Dutch Cargo Connection provides services for other perishables such as fish, fruit, vegetables and mushrooms. Interfresh founder and CEO Sonja Kauffman will join Panalpina as the new country head of perishables for the Netherlands.
Lufthansa and easyJet in talks over Air Berlin AIR Berlin says negotiations with Lufthansa and easyJet will continue until 12 October 2017 with the aim to takeover units of the German carrier. Air Berlin has received bids from Lufthansa for the subsidiaries Luftverkehrsgesellschaft Walter (LGW), Austrian airline Niki and parts of Air Berlin,while low-cost carrier easyJet has submitted an offer to takeover some of the Air Berlin fleet. A large part of assets look set to go to
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Lufthansa, which is bidding around 200 million euros ($238 million) for Niki and regional carrier LGW, Reuters reported. The carrier says the parties have agreed to keep the purchase price confidential, and says if the deals are finalised, there is a good chance the development loan can be repaid. The carrier will cease long-haul flight operations by 15 October 2017. Reuters has also reported British Airways parent IAG put in a bid for Air Berlin.
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NEWSWEEK APA carriers maintain strong growth Freight volumes dwarf last year
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he Association of Asia Pacific Airlines (AAPA) says the solid expansion in international air cargo markets continued unabated in August and it was propelled by surging demand for manufacturing goods. AAPA explains firm demand for manufactured products, particularly pharmaceutical goods and technological equipment, underpinned the month’s strong 12.2 per cent increase in air cargo demand as measured in freight tonne kilometres (FTK) for Asian Pacific carriers. The growth in air cargo volumes significantly outpaced the 5.6 per cent expansion in offered freight capacity, leading to a 3.8 percentage point rise in the average international freight load factor to 64.1 per cent
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for the month. AAPA says that growth in both the Asia Pacific freight and passenger markets was supported by high business confidence levels across the services and manufacturing sectors in major advanced and emerging economies. AAPA director general, Andrew Herdman says: “The sustained growth in air traffic demand has clearly been positive for the sector. “Nevertheless, against the backdrop of a challenging operating environment marked by highly competitive air fares and rising costs, Asian carriers are continuing to work hard to improve profitability, with considerable variations in individual airline performance, both globally and within the region.” Looking ahead, Herdman is positive about the finish to the year: “Broad-based expansion in global economic output should help to sustain further growth in both air passenger and air cargo traffic demand in the upcoming months, and the longer term outlook remains broadly positive.”
THE Airports Council International (ACI) says in July freight volumes increased by 8.9 per cent fuelled by strengthening global trade and industrial production. On a year-to-date basis, global volume reached 8.4 per cent, which ACI notes drawing a particularly stark contrast with July 2016, where this number stood at 0.9 per cent. Most regions posted strong growth in freight volume, with Africa leading the group at 18.1 per cent, followed by Europe (11.2 per cent), the Middle East (10.6 per cent) and Asia-Pacific (9.3 per cent). North America and Latin America and Caribbean, did not benefit from the same strong surge, increasing 6.5 per cent and 3.8 per cent respectively, in line with their year to date numbers. ACI says two countries in particular helped boost Africa’s freight numbers: South Africa and Kenya, both posting growth rates of
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more than 20 per cent. The association adds: “Although most countries in Europe benefitted from significant growth in July, Germany and the UK, the two largest freight markets in the region, contributed significantly to these numbers, standing at 9.3 per cent and 12.5 per cent respectively. “As with the passenger traffic numbers, Istanbul Atatürk Airport stood out in freight volumes, growing 32.2 per cent year-overyear (YOY). Continuing a trend started in March, Heathrow Airport contributed a significant part of the freight market’s increase in volume, growing 15.1 per cent in July, YOY. “Despite a decrease in passenger traffic at Doha International Airport (pictured) due to diplomatic fall-out in the region, the airport continued its sustained growth in freight volume, reaching 14.5 per cent YOY.”
NEWS WEEK Aid flown out to hurricane hit Caribbean Irma relief missions for Volga-Dnepr
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argoLogicAir has flown over 100 tonnes of humanitarian aid from East Midlands Airport (EMA) to Barbados following Hurricane Irma. The aid left EMA at 17.00h on Thursday, 21 September carrying 110 tonnes of cargo including water and other supplies, flying to Barbados to then distribute the aid to islands across the region, mainly for British troops and aid workers in the region. The flight was operating on behalf of the UK Ministry of Defence, which worked in partnership with CargoLogicAir, Air Charter Service (ACS) and Manchester Airports Group (MAG). The Boeing 747-400ERF had already flown to Guadeloupe delivering aid on behalf of the French government, before flying to Quito in Ecuador to pick up flowers, which were flown to Maastricht in the Netherlands before landing in East Midlands to take the aid to Bridgetown, which is being used as a distribution hub as it has not been damaged. Speaking to Air Cargo Week (ACW), EMA operations director, Howard Ebison explained in a situation like this, it is hard to know what has happened at the destination, so MAG’s job is to
make everything easier at its end. He says: “As the largest pure cargo airport in the country we have a lot of relationships with significant partners and experts in this field and we can pull together as a team of multiple different businesses to enable something like to happen really effectively.” He is expecting more flights, not only due to Hurricane Irma, but also for the other hurricanes, and the Mexico earthquake, which are likely to require aid flights. CargoLogicAir chief executive officer, Dmitry Grishin told ACW the carrier has done three flights - two for the French government from Chateauroux to Pointe-a-Pitre and this one. “This aircraft has just come back from the second French flight with a load of perishables from South America to Maastricht,” he added. Speaking before take-off, ACS press officer, Glenn Phillips said ACS has been organising aid flights including island hops carrying small loads of about three tonnes, and private jets. He added it had organised about 20 flights to date, including two using Antonov AN-124s and at the time of writing ACS had moved about 1,000 tonnes of aid.
VOLGA-Dnepr Airlines has so far operated three flights carrying nearly 175 tonnes of relief goods and equipment supporting international humanitarian aid projects to help victims of Hurricane Irma in the Caribbean and Florida. The most recent flight on 18 September was chartered by DSV Air & Sea for the Danish Red Cross and operated from Billund Airport to Miami International Airport. The 25 tonnes of cargo onboard the IL76TD-90VD Freighter included medicines and medical equipment as well as tents and other equipment to set up a large base camp, such as bedding, a mobile kitchen, office equipment and supplies, an electricity generator, maintenance tools, mobile showers and toilets. Volga-Dnepr’s first An-124-100 flights to the region on 11 September carried 87 tonnes of food service equipment, generators, motor pumps and spare parts to Pointe-à-Pitre on the island of Guadeloupe. This coincided with a second An-124-100 flight to Bridgetown, Barbados, with a further
60 tonnes of humanitarian cargo. Onboard was a wide range of relief goods including sanitation and cleaning equipment and products to help those worst affected by the devastating hurricane that swept through the Caribbean earlier this month. Volga-Dnepr Airlines group commercial director, Alexander Kraynov explains: “For one of the flights we were also able to identify a shorter route via the Azores Islands which helped to reduce the cost of the operation. “Given our expertise in humanitarian flights and our specialist services for transporting outsize and heavyweight cargoes, we expect to be supporting the relief and rebuilding programmes in the region for some time to come.”
Double-digit tonnage growth for Dubai DUBAI International Airport’s freight volumes surged to 221,508 tonnes in August, up 10.1 per cent compared to the 201,100 tonnes recorded in the corresponding month in 2016. The gateway’s operator Dubai Airports says year-to-date cargo reached 1,737,676
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tonnes up three per cent on the 1,686,277 tonnes recorded the first eight months last year. Dubai Airports chief executive officer, Paul Griffiths says the airport is very pleased with the way things are shaping up this year across its operations.
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LONDON CARGO
Tonnage on the up and more to come
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eathrow Airport has been growing its cargo tonnage and has had 13 successive months of record volumes. In the first eight months of 2017, volumes grew year-on-year (YOY) by 10.3 per cent passing 1.1 million tonnes, and were up 8.7 per cent to over 1.6 million tonnes on a rolling 12-month basis. Head of cargo, Nick Platts (above) is expecting a busy peak ahead of Christmas and say he has been working with colleagues across the airport about doing all it can to ensure a “timely and predictable flow” of cargo during this time. “It’s hard to say whether we’ll see volumes significantly higher than last year’s peak given recent global trade trends. We are hopeful we will continue to deliver record volumes of cargo through our airport,” Platts explains. He says this year the YOY rise is widespread and it doesn’t seem to be attributable to a particular product launch or lane. The landmark 12 months for Heathrow’s freight services has seen scheduled cargo services started by Qatar Airways Cargo and AirBridgeCargo Airlines. Platt says the gateway is pleased to see “more requests for freighters in our winter schedule” so there may yet be more freighters arriving. The building of a third runway would definitely boost cargo, Platts says giving the hub greater capacity and open up some
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constrained trade routes, which he says are much needed to maintain the UK an outward-looking trading nation after Brexit. An efficiency drive has been in action in terms of cargo and Platts says it has been gathering more information and speaking to more people about how Heathrow can help. He says: “We recently completed a workshop with over 50 people from across the industry to develop a ‘Journey Map’ for cargo, which has identified some pain points and we’re now developing an action plan to address them. Some of those pain points are outside of our control so we’ll work with the appropriate stakeholders on those.” There are opportunities and Platts believes the airport now needs to action positive change but it is making infrastructure improvements and enabling better planning so it can deliver incremental improvements. “Once we get ‘Cargo Cloud’ our application that will facilitate load consolidations between members of the freight community, and the Call-Forward project which will reduce congestion in our cargo sheds area. We’ll start to see the benefits flow through,” he explains. The biggest challenge he feels is retaining the open dialogue with partners, and collaborating on action plans and encouraging stakeholders to embrace new technology and different business processes. Heathrow started the Cargo Service Quality (CSQ) scheme with likeminded European airports back in November 2015 and Platts says it continues to look for “reliable objective data” that it can use to benchmark across us all. As for the next few years, he says it is “more of the same”, adding: “We’ll be looking at all of the projects and ideas we have that will deliver a timely and more predictable flow of cargo. “We’re working closely with colleagues in the expansion team to ensure we deliver on targets to double cargo capacity with expansion and ensure a third runway is able to deliver the UK more opportunities for international trade.”
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Stansted at the ready
LONDON Stansted Airport is a key gateway for air cargo into the London region and its operator the Manchester Airports Group (MAG) believes it can play an even wider role. MAG Head of cargo and business aviation, Conan Busby feels Stansted is well established as London’s “premier freighter airport” and this is unlikely to change, but he calls on the UK Government to consider the wider UK aviation strategy to ensure it remains able to support future demand. He says there are plenty of opportunities for Stansted, saying: “It has the potential to support substantial belly cargo demand as it secures new long-haul passenger services in the future, and in the meantime there remains capacity to welcome new freighter operators and indeed growth from our existing customers. “The UK is a dynamic market and given the propositions of the Northern Powerhouse and Midlands Engine, it is likely demand for freighters will spread into regions in the future.” Busby says Stansted’s volumes have been on a steady five per cent growth trajectory since the beginning of 2015 when volumes sat at 231,000 tonnes and in September he expects volume to exceed 260,000 tonnes. “More importantly, the diversity of Stansted’s customer base has increased to represent a global portfolio of world-class cargo airlines, with recent additions including CargologicAir’s new Mexico service, Etihad Cargo and Icelandair Cargo,” he adds. All markets are performing well and the strongest are China driven by China Southern while Cargolux has commenced weekly flights from Zhengzhou, which Busby says geographically compliments the direct Chinese capacity available into the UK. He says perishable lanes continue to show growth and MAG is excited for the start of the peak season in the coming weeks. The express sector is also performing well, driven by improving macro-economic factors and e-commerce. Perishables is the stand-out vertical: “We are confident this will continue to grow – in terms of consumer demand but also as e-commerce drives demand for direct shipments rather than via European hub airports,” Busby notes. He adds: “The UK is already one of Kenya’s largest export markets, and this could grow if direct shipments become a higher priority as vendors seek product quality and speed to market.” More routes are on the radar and Busby says MAG is hopeful both belly and maindeck cargo, can be developed across MAG’s airports to satisfy passengers and UK PLC. He explains: “Given the congestion and lack of capacity in the South East there is an unprecedented opportunity to demonstrate the benefits of point to point services including shortened supply chains, reduced road traffic miles for passengers, and more investment into the regions.” Busby is sure UK volumes will grow in future due to lack of capacity in and outside of the UK: “Stansted has potential to meet up to half of London’s capacity shortfall over the next few years. Cargo will contribute towards growth.”
LONDON CARGO First scheduled service for CargoLogicAir proving popular
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argoLogicAir’s (CLA) first scheduled service from London Stansted Airport to Mexico City International Airport has started well, according to chief executive officer, Dmitry Grishin. The first and only UK freighter carrier started twice-weekly flights on a Boeing 747-400 Freighter to Mexico via Hartsfield-Jackson Atlanta International Airport on 19 August after previously running only charter services. He was speaking to Air Cargo Week at East Midlands Airport at the launch of humanitarian relief flights to the Caribbean. Grishin explains: “We launched a new service from the UK into Mexico in August and that has been very popular, we have had tremendous support from the customers and we have all the reasons to believe this service will be a success. China –
FTA welcomes transition call
Europe lane is also strong.” A massive earthquake recently struck Mexico and he says the carrier looks at its capacity to see what it could do. “We fly twice weekly out of Stansted to Mexico City and the commercial teams have been working hard to see if there is anything we offer to the relief organisations to take freight out of the UK to Mexico to help out,” Grishin says. He adds: “We have had a couple of enquiries, I’m not sure if these have been firmly booked, but we are operating on day three and day six from the UK to Mexico some I’m sure we will have some freight booked. Grishin also hails the success of the carrier, which is just short of its two-year anniversary as it was launched at the end of 2015. Grishin says: “This country did not have a full freighter operator for some time and it is important that CLA can offer capacity and capability out of this country. If you look at it, it becomes a
strategic asset we can use to respond quickly to disasters, not only to areas of British interest but also to anyone. “Our feedback is people are happy with what we can provide, especially in the current market where capacity is scarce. Anyone who can offer extra capacity on the market will be welcomed by the customers and we are hearing a lot from our customers that they would like to see more capacity on certain routes and we are working hard to develop.”
THE Freight Transport Association (FTA) has welcomed the call from UK PM Teresa May for a transition period to be a key priority for Brexit talks and says “finally” the logistics message is being heard. UK and European Union negotiators met for the latest round of talks in Brussels last week after May gave her speech in Florence. The FTA has been lobbying for a transition period since Article 50 was triggered in March this year, to enable the preparation of necessary systems and processes to ensure post-Brexit trade can run smoothly. FTA’s head of European policy, Pauline Bastidon says May’s speech finally recognised the “complexities of the trading relationships and processes which will need to be agreed and implemented”. Bastidon says May’s call for a transitional period, to give enough time for negotiators to conclude a trade agreement, and for authorities and businesses to adapt, is a “huge relief” for a logistics industry charged with ensuring trade continues to move smoothly after Brexit. She adds: “The government has finally acknowledged the scale and complexities of the task ahead to ensure frictionless trade across borders with the European Union, both mainland Europe and in Ireland, which will come as a relief to our members, which have expressed concern while facing the task of ensuring that goods and services still reach their destinations. “It is now imperative that the intentions outlined in Mrs May’s speech are followed by concrete actions. Logistics arrangements affect every part of our daily lives and need to be prioritised in Brexit negotiations. “Customers need to be certain that vehicles and planes can keep moving, that drivers can operate across borders and supply chains will not have to face insurmountable challenges overnight on Brexit day.” Bastidon notes setting up necessary arrangements for post-Brexit trade will take time and effort to get right and industry and authorities need certainty that the status quo will prevail until all parties are ready to proceed with new arrangements. She adds: “The UK’s trading partnership with the European Union is vital to the future health and growth of the British economy and it is now time for the detail of how these relationships are to develop to be at the top of the Brexit negotiating agenda.” Bastidon also urges clarity from government negotiators regarding trading arrangements with Ireland, which were missing from May’s speech as it is a “hugely complex one”.
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GLOBAL GSSAs
The good times keep rolling for Air Logistics
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here has been an upsurge in business in 2017 since the confirmation of Brexit and the appointment of a new US president, and Air Logistics Group is expecting double-digit growth, chief operating officer Stephen Dawkins says. He says it is anticipating tonnage to rise 25 per cent in 2017 followed by 12 per cent in 2018, adding “it is the time for outsourcing”. Exports have received a boost with many companies taking the opportunity to replenish their stocks as pressure remains on the Euro and Pound against the Dollar. Dawkins says: “The general feeling amongst our principals is that this upsurge will even continue through the first quarter of 2018.” All regions of the world have experienced year-on-year improvements, with key growth from Europe to Asia in the last six months, and
transpacific from Asia to the USA. This brings opportunities to expand. “We will continue to expand our operations worldwide, however we continue to see double-digit growth coming in our Asian operations, be it organic, or via acquisition,” Dawkins says. Events such as Brexit have had an impact on business. “As our world is governed by micro-economics, where you see exports in the UK substantially improving due to the weakness of the Pound, so too you see a slowing of imports from the US and Europe because of the strength of the Dollar and Euro.” Dawkins expects to see more consolidation and an increased need to provide additional services such as fiscal, sales or operations. He says the Group’s approach allows partners to take advantage of a variety of solutions, from turnkey Total Cargo Management to local sales.
He says: “Air Logistics has moved with the times and has invested significantly in IT and back office functions, and will continue to do so as the demand from our airline clients is to have revenues and yields as quickly after flight departure as possible.” The company has invested over $6 million in the last five years in IT development to strengthen its network and offer a cost effective solution to airlines in sales, revenue accounting, trucking management and business intelligence. Dawkins says: “Adding value is key; through IT development, business intelligence, compliance and employee advancement via training and targets. These are Air Logistics Group’s core pillars, ensuring our employees are able to deliver and meet our principal’s demands today.” Understanding the customers’ need is essential in any business, and air cargo is no different.
It was the first GSSA to run its own compliance and ethics in-house training programme. Dawkins says: “This brings added value to many of our clients who are looking for assurances in the challenging and complex legal climate that we live in today.” Employee development is also key to the strategy, Dawkins says, while he is optimistic about the overall future of the GSSA market: “The size of the worldwide cargo airline market is 55 million tons of which the GSSA business is processing over 20 per cent, so there is ample opportunity for GSSA companies to invest in the future and increase this market share.”
New offices and contracts help AIA grow
AIRBRIDGE International Agencies (AIA) has had a strong year with tonnage growing 25 per cent due to new offices and carrier contracts, says chief executive officer Mark Andrew (right). The company has opened offices in Cyprus, gained Thomas Cook and Cobalt Air and existing clients have been performing well, including China Southern Airlines, which added a second daily London to Guangzhou service. Andrew says AIA has also invested in new IT systems and online booking platforms to offer better customer service. So far this year, tonnage is up 25 per cent and turnover by 15 per cent. Andrew is expecting a strong peak season: “We are now entering our peak period so we are expecting some good results which coupled with results so far should give us an improved performance on 2016 for both tonnage and revenue.” New staff also help, Andrew says: “We have just taken on Jaime Salguero in our worldwide and commercial vice president role to look at ways to expand further our brand in terms of offices and mandate carriers.” AIA plans to finish its European Union expansion in 2018, then Asia will be the focus. The UK is performing well due to the weak Pound, while key routes to the Far East and Australasia are busy, and Thomas Cook flights to New York have seen strong results along with Cobalt services to Cyprus. Andrew feels AIA offers airlines a number of advantages including its knowledgeable staff, flexible business model and offering
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cost savings for carriers from having to set up their own offices, making cargo a more profitable set up and inserting a valuable revenue stream into their operation. He says: “We are always looking for the long term relationship with a carrier, a win-win solution. AIA has seen considerable growth over the past few years and that’s down to our current airline mandates. “I would like to think that any new carrier looking at AIA would see these results and feedback from current airlines and understand how they too can enjoy the benefits of having AIA work with them.” Andrew says a GSSA must offer more than just sales, marketing, reservations and accounting. He says: “We offer a total solution of not just the mentioned basics but other solutions like cargo training to airlines so they understand the costs involved in carrying cargo, IT software, e-commerce solutions, audits of all stations on the airlines network, assistance with ACC3 certifications, charter work for the clients fleet, linking up SPA potentials for the airlines network, the list is never ending.” The market is facing many challenges, not just Brexit and potential trade deals. Andrew says: “We have to be mindful of competition, rates, yields, market shifts and ensure we are in-front of these so that we can adapt accordingly.”
GLOBAL GSSAs Investments paying off for ECS as it evolves its business
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he ECS Group has arguably been the most active of general sales and service agents (GSSA) this year widening its network and taking stakes in various companies. These have included taking a majority stake in the AVS GSA Group, new carrier contracts with Jetstar Asia and Finnair Cargo, and airlines in other regions and partnering with Canadian-based Exp-Air Cargo. ECS Group chief executive officer (CEO), Adrien Thominet (pictured) who took over the helm from Bertrand Schmoll as CEO in June this year, says all the moves have boosted business. “Business ventures are always very beneficial for ECS. Since our strategy is to integrate new companies under ECS as one sole entity, the synergies are immediate and at all levels. This creates interactive opportunities and exchange of business opportunities,” Thominet explains. He adds: “The new contracts are very important too, especially when it is TCM (total cargo management) like for Jetstar; this justifies even more the interest of having a complete network whom become the GSA of this carrier sharing the same motivation and aim as HQ. “The local contract like Oman Air (in Benelux) is also a testimony of the good relationship we keep with our partner. Oman is already a strong ECS partner in Asia and this helped to enlarge our coop in Benelux. The results are satisfying too since we are exceeding our budget since the first month.” In 2017, Thominet says business has been “excellent” with an overall double-digit uptick and the only slow region has been South America, which has seen a lower level of growth.
our core business and face this disruption with serenity,” he adds. And to make sure ECS remains in a strong position, he says ECS wants to fully align with the transformative needs of partners and clients and to support them to navigate the shift to compete in the digital economy.
Reorganisation
This means changes as to how the whole business works, Thominet explains: “We cannot focus only on innovative tools and new business solutions, but we also have to make mentalities evolve to match with the future of our business. “We organise regular training sessions and communicate a lot internally about those new changes among our group. We also hired experts on digitisation so that our group is capable of adapting quickly to the global changes.” The reorganisation he says is the precursor to the comprehensive approach ECS is adopting to stay on top in the competitive
business environment and it intends to steer this strategic expansion and concentrate on a new business model to reinvent the way GSSAs currently work. As for the future, he is clear on how GSSAs need to be: “The GSSA should be able to reinvent itself and become more and more a mirror to the airline’s organization. The local hero concept is not enough anymore when we see the challenges ahead of carriers.”
Outsourcing gains
He expects this performance to continue and notes ECS is looking to grow its network in Northeast Asia: “We expect to keep same trend until end of the year. 2018 seems to keep the same trend too and we foresee no reason of decline on trade volumes.” Thominet believes when a carrier outsources the selling of its cargo space to ECS, there are many advantages as consolidation brings synergies, while being part of a strong network allows all its subsidiaries to provide their principals with unlimited connections and options to expand their coverage. He says being one of the biggest integrated GSSAs gives coherence to daily work and ECS acts as a facilitator by bringing streamlined process and standardised services. Thominet explains: “Regarding our way to do business, we understood that airlines are looking for more than sellers. Hence, we are able to propose new business services and to rethink the way to cooperate with them. “Also, we are still focusing on bringing and hiring the best and most experienced people on the local market. Our teams are strongly established and leaders in their market. It’s not only putting a flag in a country, it is much more a question of loyalty, strengthening of a relationship and trust, which bring us the capability to provide the best services within the region.”
GSSA role evolving
In today’s market, he says airlines are looking for more standardised services with more security, and beyond the forecasts they are looking for a commitment, which ECS can offer. “Hence, we provide high flexibility and tailor-made solution, in terms of IT, organization, and services to provide. Innovation is definitely an area where we invite our customer to focus with all new technologies and BI that we can provide,” Thominet adds. The role of the GSSA is evolving and Thominet believes they will need to transform and provide multiple solutions in terms of service, technologies and market presence. He believes the relationship with customers will become closer and closer thanks to new technologies adopted and will be focused on offering a new set of services in the logistic chain. Thominet says new technologies and digitisation are the new way to compete on productivity, cost-efficiency and market shares. “Obviously, this has a disrupting impact on the entire logistics value chain and we need to get the capability to reinvent
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PHARMA ROUND-UP Hyderabad looking to further grow its pharma traffic
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ajiv Gandhi International Airport (RGIA) is one of India’s most important pharmaceutical gateways and is looking to further grow its pharma traffic. The core part of operations is the Pharma Zone, which when opened by airport operator GMR Hyderabad International Airport Ltd (GHIAL) was India’s first end-to-end temperature-controlled terminal dedicated to handling pharma shipments. Hyderabad is the pharma hub of India, and 60 per cent of RGIA’s cargo volume is made up of pharma products and Hyderabad has witnessed CAGR of 10 per cent in the last five years. RGIA has started various initiatives to drive pharma traffic and help meet demand from customers including developing partnerships for active and passive cooling storage mechanisms with Envirotainer and Agility Logistics. GHIAL has also successfully obtained approvals from the Customs to start movement of refrigerated ‘cool containers’ directly to and from the premises of customers. Envirotainer has a network of 200 airports and has chosen RGIA as their regional hub for distribution of their products in
India and made it possible to bring cargo from shippers’ premises and delivering it to the importer’s premises without any disruptions in the cold chain. In order to create awareness among the pharma community, RGIA says it has been supporting regular training and awareness programs on Envirotainer operations. RGIA has also brought in Agility in partnership with va-Q-Tec, to start their first temperature-controlled life sciences storage
and handling facility at RGIA. Va-Q-tec’s 6,000 square foot facility Life Sciences Excellence Center (LSEC) caters to pharma manufacturers in Hyderabad, Goa, Pune, Vishakhapatnam and Bengaluru. Over the years, the Pharma Zone has catered to shipments moving to the Middle East, Asia, Europe, North America, South America, Africa and Oceania, but to grow pharma exports further, RGIA says it plans to grow international connectivity and expand its cargo network to Africa, the Far East and China. Over the years, India has become a leader in pharma production ranking 4th in the world among generic pharma producers and contributing around 20 per cent of global generic drug exports. Hyderabad has been a catalyst in development of the pharma industry in India with 60 per cent of exports pharma products. Around 20 per cent of exports of RGIA come from other states including Vizag, Nagpur, Goa, Chennai, Pune, Mumbai, Bangalore, Ooty, Coastal Andhra, Indore, and Nasik. GHIAL says transporting pharma by air in temperature-controlled conditions is a “life-critical business” and its facilities are playing their role in “maintaining the integrity” of the vital drugs.
Osaka pharma community
A pharmaceutical community has been developed at Osaka’s Kansai International Airport in Japan as the gateway looks to increase pharma traffic. The operator Kansai Airports says the KIX Pharma Community will work towards acquiring IATA’s CEIV Pharma certificate and all six community members will train towards gaining the certification from spring through to summer next year. The KIX Pharma Community was developed in August this year and will see six participating companies: Bolloré Logistics Japan, CKTS Co (Kansai Airports Group), Hankyu Hanshin Express Co, JAL Kansai Aircargo System Co, Mitsubishi Logistics Corporation and Yusen Logistics Co. Kansai International Airport says it has been improving the quality of pharma cargo handling, and with the airport playing a central role, Japan’s first ever airport-based pharma community will be formed to work toward acquiring the certification. The certification it explains will allow the airport to provide customers in the pharma and related industries with “safer and higher quality of pharmaceutical transport services”. Kansai Airports adds it will continue to strive for further improving the quality of pharma cargo handling.
China Airlines signs deal
DOKASCH Temperature Solutions has expanded its global network after entering an agreement with China Airlines. The deal gives the carrier access to lease the Opticooler, the firm’s newest technology of active containers. China Airlines says: “With DoKaSch Opticooler, we are able to offer our customers a particularly reliable container for their extremely temperature-sensitive air cargo shipments. “In this strongly competitive market, it is key that we offer our shared customers the best possible solution for their most precious cargo.” DoKaSch Temperature Solutions says the Opticooler operates like a “flying smart warehouse” safeguarding the effectiveness of vital pharmaceuticals throughout global transportation chains Electric, battery-powered cooling compressors and heaters are able to keep the temperature inside the Opticooler in the once set temperature range. DoKaSch Temperature Solutions managing director, Andreas Seitz says: “We are very pleased to make our Opticooler available through China Airlines. Especially as Asia, and in particular Taiwan, is one of the main hubs for the fast growing market of pharma goods.”
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NEWSWEEK Real-time data to be available to Cargo iQ members for 1st time
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argo iQ has launched an ‘Air Cargo Intelligence Hub’ giving its members real-time access to data for the first time. The move was detailed at its Commercial Summit in Geneva, where the IATA-interest group also revealed a new Sales Toolkit, outlining the value of the organization. The ‘Hub’ allows members to search their Cargo iQ data by route, milestone, station, product, customer, or provider, enabling them to develop new products, improve processes, and drive quality in the air cargo industry. The online self-service access gives members real-time information on performance, enabling them to develop new products and improve processes. The ‘Air Cargo Intelligence Hub’ gives members access to their data on any given route and produces customised reports, allowing them to
compare their own performance against Cargo iQ standards, and the community overall. Cargo iQ members work with shared shipment planning called route maps, based on its Master Operating Plan (MOP), which measures each individual cargo journey from shipper to consignee against 16 milestones. Through analysis of the data generated by these measurements, members can work with their customers and suppliers to improve performance, develop new products, and drive quality in the air cargo industry. Cargo iQ executive director, Ariaen Zimmerman says: “Our members can now analyse their data and see it in an easy to understand, meaningful way; giving them the tools to focus their resources to where they need to improve processes, and supporting them to optimise their products and requirements both for their industry partners and our customers, the shippers.
“Cargo iQ members are focused on quality in the air cargo industry and our new Hub will help demonstrate the value that air freight brings to the global logistics market. “Members will be better able to explain to current and potential customers exactly what it is they are paying for, and offer them a choice
of products – something new and refreshing for the somewhat traditional airfreight sector.” Cargo iQ chairman and DHL Global Forwarding senior vice president and global head of network carrier management, Henk Venema believes Cargo iQ members continue to innovate and make quality the focal point of the air cargo industry, collaborating to improve airfreight, and using Smart Data to optimise their products. He adds: “Our work with shippers shows the need to have timely and clear information shared and our members understand that better than anyone. “Cargo iQ will take part in GSF’s next meeting in preparation of a joint launch of the industry’s first shipper KPIs later this year, marking another important milestone for our industry.” The ‘Hub’ is one of a series of initiatives aimed at improving the value Cargo iQ delivers to its members and to the industry as a whole.
BOLLORE Logistics has opened a new multimodal hub on the Logistics Park of Pont de Normandie 2 (PLPN2) – in the heart of France’s leading foreign trade port. The French logistics firm says with this new site located near the multimodal terminal, it offers all the solutions to manage flows throughout the Seine Valley. The 24,000 square metre warehouse built near the multimodal terminal it says reinforces Le Havre as a major port logistics hub. Bolloré Logistics now has 110,000 square metres of warehouse space in Normandy, with 39,000 square metres in Le Havre. Director of the Normandy Region, Laurent Foloppe says: “Our platforms connected to all modes of transport – sea, air, road, rail, barges are designed to support the growth
and sustainable development of our clients in the Port of Le Havre and the Normandy region.” Bolloré Logistics’ strategy is to invest in the hubs by positioning itself on the world’s major trading hubs, such as Singapore, Dubai, Miami, which allows Le Havre to draw more flows and manage global logistics activities and supply chain of its customers.
New mulitmodal hub for Bollore
Cargo cover recycling service launched
DUPONT Protection Solutions has started a new courtesy recycling service for its range of DuPont Tyvek Cargo Covers. The program is available in the US and will soon be offered in Canada and other markets. The program is the latest step in the company’s commitment to sustainability and the environment and it says it will ensure all Tyvek customers have access to a “satisfac-
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tory end-of-life solution”. DuPont Protection Solutions North America segment manager, Linnette Lopez says: “Shippers have told us they want a dedicated recycling service that is convenient to use and guarantees the product will be recycled in an environmentally responsible manner. “The new recycling program is provided to our Tyvek customers at no charge and, depending on volumes, the spent covers can either be picked up from site or dropped off at a local processing center.” All Tyvek Cargo Covers are included. Reclaimed Tyvek material will be recycled into a high-grade polymeric feedstock for processing into products such as decking boards, street furniture, playground equipment, siding materials and lightweight shipping pallets.