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The weekly newspaper for air cargo professionals No. 1,007
12 November 2018
Turkish delight at Istanbul launch
Pages 8-9
INSIDE EUROAIRPORT GAINS IATA CEIV
EUROAIRPORT Basel Mulhouse Freiburg has been presented with its IATA CEIV Pharma certificate in the presence of airport stakeholders and ... PAGE 2
25 YEARS OF SUCCESS
JD.com cargo flights take to the skies C hinese retailer JD.com has partnered with Tianjin Air Cargo to ship goods on cargo aircraft as the e-commerce giant ramps up its logistics business. The service will fly six round trips a week between Tianjin and Guangzhou using a Boeing 737 branded with the JD Logistics logo. JD.com says the dedicated capacity will fulfil same-day and next-day orders nationwide, and will be used for JD’s growing logistics business, which includes business-to-business and parcel delivery throughout China. The retailer says using cargo airfreight is more reliable than belly capacity on passenger aircraft as flight times can be adjusted
according to industry demand. JD.com and Tianjin Air Cargo will work closely to expand the service, with further routes planned between Northern and Southern China. JD Logistics head of the express business unit, Hui Wang says: “We look forward to expanding our relationship with Tianjin Air Cargo in the coming months and we are sure that the resulting expedited delivery speeds will be welcomed by individual consumers as well as the businesses we work with as part of our ‘Retail as a Service’ strategy.” Tianjin Air Cargo chairman and president, Yi Zhang says: “This service sets a new industry milestone. The combination of Tianjin Cargo’s breadth
of experience in freight and JD’s expertise in supply chain makes this partnership a force to be reckoned with. “As China’s largest retailer, online or offline, JD’s resources across the e-commerce and logistics industry will be of great assistance to our company’s development going forward.” The partnership is the latest move by JD to open its technology and infrastructure to other companies and industries as part of its Retail as a Service strategy. JD is using a variety of delivery methods to get goods to customers including drones, freight trains, unmanned delivery vehicles and high-speed rail.
AIR Logistics Group is entering its 25th year in the air cargo industry, having grown dramatically since it was founded in 1994 ... PAGE 3 PROFITABLE Q3 FOR ATSG
AIR Transport Services Group has turned the losses of 2017 into a third quarter profit, but pilots are unhappy at the pace of contract negotiations ... PAGE 4
EASTERN EUROPE’S CARGO CITY
HAVING experienced a number of years of strong growth at Budapest Airport, new developments such as the Cargo City should mean the good times .... PAGES 6-7
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Movember update #2
THE man and his ‘tache. At last, after two weeks, there is evidence that the editor is finally growing his moustache. Naturally he is growing it for a reason and would ask all big-hearted readers to go to his Movember page and make a donation this month. https://moteam.co/ airfreight-airies
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EuroAirport earns IATA CEIV
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uroAirport Basel Mulhouse Freiburg has been presented with its IATA CEIV Pharma certificate in the presence of airport stakeholders and IATA representatives. The certificate was presented to the airport at a customer event at the EuroAirport Cargo Terminal in the presence of IATA’s global head of cargo, Glyn Hughes and representatives from Fiege, Fischer Road Cargo, Swissport and Swiss WorldCargo. The airport, which is situated at the crossroads of Switzerland, France and Germany is the first airport authority to be certified IATA CEIV Pharma within a community approach in France and Switzerland. In 2015, Fiege, Fischer Road Cargo, Swissport and Swiss WorldCargo joined forces to implement IATA CEIV both individually and at a collective level. All programme participants worked closely
together to ensure they delivered high quality standards in transporting, storing and handling temperature sensitive pharmaceuticals at EuroAirport. The 21,000 square metre Cargo Terminal offers constant temperature control, real-time temperature monitoring as well as fast and efficient processing.
Survival of the fittest WHEN the current recession hit hard in 2008, some executives of multi-national freight forwarders thought this would be an opportunity to out- manoeuvre their smaller competitors but did not take into account that smaller management teams, often headed by owner CEOs, meant quicker flexibility. It is worth noting that multi-nationals, of which there are only around a dozen of any note, may have offices in the major cities, such as Beijing, London, New York, Paris and Tokyo etc but are reliant in the smaller specialists in many of the other cities and towns. In total there are over 20,000 air cargo agent offices in the world. Now this is where the WCA Family of Logistic Networks has been so successful, boasting 5,304 cargo agent customers in 190 countries. Their success is based on providing great networking opportunities and the confidence of insurance policies. The whole idea is master-minded under CEO David Yokeum - a clear believer in Charles Darwin.
Whose agent?
It makes sense that cargo agents seek the approval of IATA to trade with their 290 airline members; this does not make them IATA’s agents. It is commonly accepted the freight forwarder is agent of the shipper. It is equally understood that if airlines wish to adopt a paperless booking system, the cost should be split between the 290 airline members of IATA. For years now there has been a computerised system for passengers but not cargo, simply because IATA hopes that cargo agents will pay for a system that will make the airline’s process easier. Perhaps it will speed up the long delay for airlines to appreciate their valuable cargo moves door-to-door, thanks to the airfreight forwarder, and for IATA to stop promoting them as their agent, when they are clearly the agent of the shipper.
ACW on this day
“Ad Astra”
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THE JFK freight community was never going to buy this plan which disappeared without trace
AfA attacks Cuomo plan for cargo
Vol 17 Issue 44 10 November 2014 THE Airforwarders Association (AfA) has hit out at New York state govenor Andrew Cuomo’s plans to move cargo operations from John F. Kennedy International Airport (JFK) to Stewart International Airport. Cuomo announced the plans to move cargo away from JFK to Stewart in a press conference on 24 October attended by vice-president Joe Biden. The Cuomo plan would set up a tax-free zone at Stewart to encourage business to relocate, while JFK and LaGuardia Airport would modernise their facilities. AfA director general Brandon Fried tells Air Cargo Week that his members “initially viewed them [the plans] as not serious and also indicative of the lack of knowledge of the impact air cargo has on JFK, the New York area and the nation as a whole.”
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25 years of success for Air Logistics Group
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ir Logistics Group is entering its 25th year in the air cargo industry, having grown dramatically since it was founded in 1994. The team consists of over 230 airfreight professionals spanning 88 offices in 48 countries, making it one of the largest and most recognisable GSSAs in the world. It has over half a billion Euros of cargo sales and processes over half a million airway bills every year. Air Logistics Group founder, chief executive officer and ACW A-lister, Stephen Dawkins (pictured) says: “Since its inception, ALG has developed significantly from the traditional ‘General Sales Agent’ that was established in 1994. Our business has come a long way over the years, airlines have come and gone, we are still here, striving to provide the highest level of service to our Airline and Forwarding clients.” “I am proud to be part of an ALG team of employees from many walks of life; some bring tremendous experience from airline and forwarding backgrounds, alongside a loyal and dynamic management team that has been the driving force behind our success.” “Moving forward, our focus will remain on providing airlines and
the first Boeing 747-400ERF joined SF Airlines’ fleet on 26 October when it arrived at Shenzhen Bao’an International Airport. It is the 48th aircraft in the fleet and ushers in what SF Airlines called the “big aircraft” era. Two 747s were bought at auction in November 2017, making SF Airlines the first express operator in China to own 747s.
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Aeronautical Engineers (AEI) has signed a contract with Automatic to provide the company with a Boeing 737-400SF. The 737-400, MSN 25853 is being modified and will be re-delivered in March 2019. It will be operated by UK-based Titan Airways and represents the airline’s second 737-400. Commercial Jet’s Dothan, Alabama is handling the modification touch-labour and maintenance requirements. forwarders with a reputable, financially sound partnership that can deliver in terms of revenue, network coverage, digitalisation and manpower.”
FedEx adds flights between Sydney and Singapore
Dubai World Central (DWC) has welcomed the inaugural flight by Uni-top Airlines, providing services to Kunming in Yunnan province. The Chinese airline will operate three flights a week between DWC and Kunming, the capital of Yunnan in southwest China. Uni-top Airlines was established in 2008, making it the first Chinese private airline to independently operate long-haul cargo aircraft. It started operations in 2009 with three Boeing 747-200Fs out of Wuhan Tianhe Airport, and Uni-top now also has one Boeing 747-400F and seven Airbus A300-600Fs. Finnair chief commercial officer, Juha Jarvinen will leave the company on 31 December to take up a new role at Virgin Atlantic in London. Finnair’s interim CEO, Pekka Vahahyyppa thanked Jarvinen for his work, saying: “During the almost seven years that Juha has been at Finnair, we have built a strong position in many markets. During his leadership of Finnair Cargo, we made the decision to build the most modern cargo terminal in Europe, and the cargo terminal is now a key enabler of Finnair’s growth strategy.” Jarvinen will continue as chief commercial officer until the end of the year, and the search for his replacement starts immediately.
FedEx Express has launched four flights a week between Sydney and Singapore to meet customer demand for capacity, particularly for heavyweight shipments. Australian customers will benefit from increased capacity and reliability to transport retail freight, healthcare products, perishables and lithium ion batteries between the markets. Customers in Sydney will have a three-hour cut-off time for outbound shipments to Singapore and Malaysia from Tuesday to Friday, with cut-off times closer to close-of-business hours. The new flights offer International Priority Freight and International Economy Freight services for imports into Australia from Singapore, China, Korea, Indonesia, Malaysia and Vietnam.
Customers will also be able to use the FedEx International Priority Direct Distribution service for import shipments into Australia from Vietnam and Indonesia. FedEx Express Australasia vice president, Peter Langley says: “This new flight shows our continued commitment to help connect Australian businesses, large and small, to new possibilities through the strengths and reach of our combined domestic and international networks. Australian products have garnered a strong reputation internationally and we are seeing growing demands for a range of Australian goods, including perishable and healthcare products. This flight is going to benefit Australian businesses in accessing markets both within and outside Asia Pacific.”
E-AWB will be the default from 1 January 2019 In a surprise statement, the International Air Transport Association (IATA) has informed the industry that, effective 1 January 2019, the electronic Air Waybill (e-AWB) will become the “default contract of carriage” for all air cargo shipments on enabled trade lanes. This is just weeks after Air Cargo Week carried an open letter from six industry leaders demanding greater implementation of this very measure. “This key industry milestone ushers air cargo into a new era where digital processes will be the norm and paper processes will be the exception,” says IATA. It claims the e-AWB brings numerous benefits such as: Elimination of paper based processes Improved efficiency and reliability of the overall cargo handling process Faster delivery times
Decrease handling errors Positive impact on the environment with reduced paper usage IATA introduced e-AWB in 2010 with the objective to initiate the digitalisation of the air cargo supply chain. Ever since, the e-AWB initiative has been a key enabler to the digitalisation and transformation of our industry, as data availability and quality is critical to deliver innovative solutions and enhance customer experience. The growing number of stakeholders using e-AWB demonstrates that the industry is ready and committed to embrace the full digitalisation of the air cargo industry. “IATA encourages all air cargo industry stakeholders to switch to e-AWB at the earliest unless a paper air waybill may still be required due to applicable international treaties, national law, or as bilaterally agreed between the parties,” the association says. All necessary information for implementing e-AWB is in the IATA e-AWB Implementation Playbook.
Chile’s Free Competition Defence Court (TDLC) has approved the Joint Business Agreements (JBA) between LATAM Airlines Group, American Airlines and IAG for both passenger and cargo businesses. Since the announcement of the agreements in January 2016, LATAM’s JBAs have been approved by Brazil’s Administrative Council for Economic Defence, Colombia’s Aerocivil and Uruguay’s Dinacia. United Airlines has taken delivery of its first Boeing 787-10, making it the first airline to operate 787-8s, 787-9s and 787-10s. The 787-10 is 18 feet longer than the 787-9, carrying more passengers and cargo than previous 787s and using 20 per cent less fuel than older generation aircraft. United Airlines took delivery of the aircraft at Boeing’s delivery centre in Charleston, South Carolina. The aircraft is expected to enter service between Los Angeles and New York Newark on 7 January. United Airlines will take delivery of 14 787-10s. At 05:05 (AST) on Wednesday 7 November, a Boeing 747-400 SkyLease cargo aircraft arriving from Chicago, Illinois, went off the end of Runway 32 upon its scheduled landing at Halifax, Nova Scotia. In a statement, Halifax Stanfield said it had “activated its emergency plan and its well-trained and highly skilled emergency response team is responding to the incident along with local emergency responders including Royal Canadian Mounted Police (RCMP), Halifax Regional Police (HRP), Halifax Regional Fire & Emergency (HRFE) and Emergency Health Services (EHS).” The aircraft was carrying five crew members who were removed from the aircraft and transported to hospital for treatment of minor injuries. The airfield was temporarily closed but reopened at 09.00 local time.
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Virgin adds second flight to Jo’burg
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irgin Atlantic Cargo has increased support for South Africa’s air cargo market with a second daily service between London and Johannesburg. The double daily Boeing 787-9 flights will also benefit customers in the US who will have access to additional cargo capacity to and from South Africa via London. Virgin says it is seeing strong demand to and from South Africa, with US-South Africa volumes growing eight per cent this year, and traffic from Johannesburg up two per cent thanks to regular shipments of perishables as well as car parts, computer components, mining equipment and personal effects. Exports from the UK to South Africa include fish and foodstuffs, pharmaceuticals, books and magazines, agricultural spares, electrical components and automotive parts. Virgin Atlantic Cargo managing director, Dominic Kennedy says: “We are experiencing a
Kennedy high level of demand for capacity to and from South Africa, so the launch of a second daily service will go some way to providing the extra space our customers in the UK, US and South Africa need. On October 28, our first day of double daily services, both flights operated with full payloads totalling 34 tonnes and we expect this to continue given the broad range of goods moving to and from Johannesburg. This is one of our best-ever years on the route, which Virgin has now served for over 22 years.”
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Auto clients drive growth at Air Partner Strong demand from automotive and aerospace clients helped push up profits for Air Partner’s Freight division by 36 per cent in the first half of 2018. Gross profits for the six months ending on 31 July 2018 were £1.5 million, with the Freight division continuing to grow its global operations. Customers using Air Partner’s Freight services come from industries from oil and gas to charities, with automotive and aerospace demand proving strong for charter and on board courier products In 2017, the German office moved to a larger premises in Cologne to cater for further growth, and 2018 saw the appointment of a new freight charter sales broker and sales manager. An office was opened in Los Angeles and the Freight team in Fort Lauderdale moved into a new office. The team in Turkey increased in size,
following significant business growth. Air Partner director of freight, Mike Hill says: “I am proud of the tireless work of the Freight team and our success in the first half of the year. We won’t be resting on our laurels, however – we are committed to continue growing our client numbers, whilst never sacrificing the high levels of customer service that are synonymous with Air Partner.”
Profitable third quarter for ATSG, pilots demand contract negotiations Air Transport Services Group (ATSG) has turned the losses of 2017 into a third quarter profit, but pilots are unhappy at the pace of contract negotiations. In the third quarter of 2018, net earnings were $33.1 million compared to a loss of $32.8 million in the same period last year. For the first nine months of 2018, profits were $73.6 million having made a loss of $76.6 million in 2017. Third quarter revenue was down from $254.1 million to $204.9 million and nine month revenue was down from $745.2 million to $611.5 million. ATSG president and chief executive officer, Joe Hete says the airline business performed well and has high hopes for the peak season. He says: “We intend to add five more 767-300 freighters, including three more external dry leases, to our in-service fleet by the end of the year, or all ten of the 767s we planned to deliver in 2018. Additionally, we expect to dry lease two 767-200 freighter aircraft, currently on lease to our airline affiliate, to external customers by year-end.” ATSG’s leasing business, Cargo Aircraft Management (CAM) saw third quarter revenue stay flat at $58.8 million with higher revenue from additional aircraft in service being offset by revenue loss from transitioning aircraft, fewer engine leases and lower revenue for maintenance services for lease customers. Pre-tax earnings fell slightly from $19.4 million to $19 million in the third quarter with improved lease revenues being offset by increased depreciation and lower revenue from engine leasing and lease-customer maintenance support. CAM acquired one Boeing 767 for freighter conversion in the third quarter, and expects to acquire another four in the fourth quarter.
Hete says: “Our outlook for the fourth quarter remains very positive, with five newly converted 767-300 freighters set to enter service, including three that will be deployed under long-term external leases and two that will support peak season ACMI demand. We are focused on providing our customers with excellent service during what we anticipate to be a very busy fourth quarter.” Responding to ATSG’s third quarter results, Airline Professionals Association Teamsters Local 1224 executive council chairman, Rick Ziebarth who is a pilot at ATSG subsidiary ABX Air says pi-
Hermes manages cargo in Hyderabad
Hermes Logistics Technologies has implemented Cargo Management Systems at Hyderabad International Airport. A five-year contract was signed with GMR Group’s subsidiary GMR Hyderabad International Airport (GHIAL) including an upgrade schedule to ensure the cargo terminal will continue to operate with the most sophisticated Cargo Management Systems available. The timeline from signing the contract to production was 60 days, with Hermes CEO, Yuval Baruch saying the company rose to the chal-
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lenge and managed to go live in 58 days. He says: “It was a pleasure to work with GMR who are highly professional and committed their best people to work with us on this project, which was extremely helpful and enabled us to meet the implementation deadline.” GHIAL CEO, SGK Kishore says: “Hermes was selected amongst others as they were found to be capable of meeting our needs and delivering our ambitious upgrade plans, as we seek to continuously offer the highest level of service for our customers.”
lots are “disappointed” at the lack of progress management have made to achieve a collective bargaining agreement. He says: “As we approach the holiday season, we prepare for some of our busiest days. We want to do the best job possible and help ABX Air be successful. It is crucial that ATSG focus on concluding an amended contract for the pilots of ABX Air in order to attract and retain the pilots necessary to be competitive in the cargo industry. With four years of negotiations and zero progress, the pilots’ patience is wearing thin.”
Saudia brings Crown Jewel to Riyadh
Saudia Cargo brought World Wrestling Entertainment (WWE) to Saudi Arabia by transporting equipment and supplies for the Crown Jewel tournament in Riyadh. Organised by the General Sports Authority, the Crown Jewel was held on 2 November at King Saud University stadium in Riyadh with the participation of professional wrestlers. A Saudia Cargo Boeing 747-8 Freighter trans-
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ported 100 tonnes of equipment and machinery together along with sound and lighting systems and other supplies from Maastricht, the Netherlands to Riyadh in mid-October. In April, Saudia Cargo transported the WWE heavy equipment and machinery including parts of the wrestling ring from New York’s John F. Kennedy International Airport to Jeddah, where the WWE event took place.
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Air cargo delivers good and bad news in September
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eptember has proved to be another slow month for air cargo with demand growing two per cent, the International Air Transport Association (IATA) says. The growth is similar to previous months though less than half the five-year average rate of 5.1 per cent measured in freight tonne kilometres. Growth is being supported by strong consumer confidence, robust global investment and rising international e-commerce but there has been a global contraction in manufacturing firms’ export order books for the first time since June 2017, and longer supplier delivery times are being reported by manufacturers in most of Asia and Europe. Freight capacity measured in available freight tonne kilometres grew by 3.2 per cent in September; the seventh month in a row capacity has outstripped demand though yields are holding up. IATA director general and chief executive officer, Alexandre de Juniac says: “Weakening order books and longer delivery times are undercutting the need for air freight in many traditional markets. But there is also some positive news. For example, strong consumer confidence goes hand-in-hand with expanding inter-
national e-commerce trade to give air cargo a boost.” He adds: “The bigger message for the sector is the need to modernise processes. There is some progress with the electronic air waybill becoming the default document on enabled trade lanes from 2019. But there is much more that must be done with governments and the supply chain to bring air cargo processes into the modern era.” WorldACD reports that global cargo volumes experienced their
first year-on-year fall in over two years in September, but advises against reading too much into the figures. September was down 0.9 per cent, the first year-on-year decline since March 2016, with fuel costs up 32 per cent compared to a year ago, though airline revenue is growing due to strengthening yields. WorldACD says September this year had one more Sunday and one less Friday, which would cause air cargo volumes to fall 1-1.5 per cent. In addition, Hong Kong was down 7.7 per cent and Japan by 4.8 per cent due to typhoons in September. Chinese exports are continuing to grow, though volumes to the USA were down 1.8 per cent year-on-year, which WorldACD speculates could be the first consequence of President Trump’s trade war. Global volumes increased 2.8 per cent in the first three quarters of 2018, while yields were up 14.2 per cent in US dollars and 6.6 per cent in Euros. All special cargo categories also outperformed general cargo, with pharmaceuticals, express and live animals recording double-digit growth.
Don’t be fooled by management painting a rosy picture, Atlas Air pilots warn the public
ATLAS Air Worldwide has posted a third quarter profits of $71.1 million but pilot unions are warning the public not to be fooled by executives painting a rosy picture. The third quarter profit compares to a loss of $24.1 million in the same period last year, while net income for the first nine months of 2018 are up to $59.6 million, compared to $14 million in 2017.
Revenue in the third quarter was up 23 per cent to $656.6 million, with ACMI revenue increasing from $258.1 million in 2017 to $288.6 million in 2018, charter from $243.6 million to $322.7 million and dry leasing from $30.8 million to $44.5 million. ACMI revenue was affected by unscheduled maintenance and higher crew costs resulting from an interim labour agreement with South-
ern Air pilots, while block hours grew 13 per cent due to Boeing 767 services for Amazon and starting Boeing 747-400 operations for several new customers. The charter segment benefitted from an increase in military and commercial cargo demand and higher yields. Dry leasing’s contribution reflected the placement of additional Boeing 767-300 converted freighters throughout the second half of
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2017 and first three quarters of 2018, as well as one Boeing 777-200 Freighter in February 2018 and a second one in July. Atlas Air president and chief executive officer, William Flynn says: “Secular trends are driving opportunities and growth in airfreight. And our focus is on express, e-commerce and fast-growing regions where efficient, time-definite, freighter networks are essential to meet the growing demands of businesses and consumers.” He says the fourth quarter will benefit from a second 747-400F flying for Asiana Cargo, the first 747-400F flying for SF Express and another two 767-300s joining Amazon’s fleet. Flynn says: “While tariffs and trade are important topics, neither we nor our customers, with whom we are in close contact, have seen a material impact on airfreight demand. Airfreight tonnage continues to grow from record levels, and airfreight demand is growing in line with its longer-term rate of about four per cent per year, with express and e-commerce growing much more than that.” Long-term Atlas Air pilot and executive council chairman of the Airline Professionals Association Teamsters Local 1224, Robert Kirchner says the financial success has come at the expense of its pilots. He says: “The bottom line is that although profits are high and executives paint a rosy picture, investors and the public alike should not be fooled. Going into Q4 and the peak season for cargo carriers, pilots fear Atlas Air will struggle with delays, scheduling, staffing, and more. It is time for executives to settle a fair contract with pilots so that Atlas Air can build long-term sustainable business practices that support our work.”
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Budapest is the cargo city of Eas Cargo is booming in Budapest, with three years of double digit growth and ground being broken at the Cargo City. Rene Droese and Jozsef Kossuth spoke to ACW about how the airport will continue growing in the future.
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aving experienced a number of years of strong growth at Budapest Airport, new developments such as the Cargo City should mean the good times will continue. The airport’s executive director of property and cargo Rene Droese and cargo manager Jozsef Kossuth spoke to Air Cargo Week at the TIACA Air Cargo Forum in Toronto where they
talked about the airport’s recent growth and plans for the future. Droese said that in 2018, Budapest is likely to handle around 150,000 tonnes, representing growth of 15 per cent compared to 2017 and marking the third year in a row of double digit growth. He said: “This is being driven by three different streams, the integrators have had fantastic business growth, we have new freighters coming to Budapest as well as belly capacity.” Droese is predicting this will continue in 2019, saying partners are do not want to stop and are considering adding even more capacity. Integrators are Budapest’s biggest customer, with aircraft laden with small packages arriving every morning to satisfy ever-growing demand from consumers wanting their goods and want-
ing it now. Kossuth adds: “Hungary Post has an exchange facility. It is always full and it is mostly e-commerce coming as normal postal shipments from China through companies such as Alibaba.” Admitting to having bought goods from one online supplier over another due to 24 hour delivery, Droese says consumer demands Droese provides challenges for the cargo community. He said: “It’s a mix of things to do, the airport needs to provide proper infrastructure, the handling company needs to make sure it has sufficient staff and equipment available 24/7 if aircraft arrive during the night and airlines need to arrive punctually.” Kossuth also emphasised B2B logistics is very important, saying: “There are hundreds of big brands in our region who are importing and exporting lots of cargo, it is booming. Bosch has 10 units in Hungary and BMW have announced a new factory. We are happy to say all segments
are growing.” The growth is being helped by air cargo partners including Cargolux, which has been flying to the airport for 16 years, as well as Qatar Airways Cargo and Turkish Cargo. Silk Way West Airlines and AirBridgeCargo Airlines have both started services to Budapest this year.
All under one roof
The partners are happy with the service they are receiving at Budapest but Droese says the airport needs to upgrade and expand facilities. He says: “This is why we have started the construction of Cargo City, where cargo will be under one roof. Cargo operations are across the airport in various warehouses. This is not the best solution.” Ground was broken at the Cargo City in September with construction expected to take 12 months and once the facility is open next September, the cargo business will be under one roof. Droese says: “This will be more efficient for handling companies, faster and offer considerable cost savings.” Budapest also has forwarding companies surrounding the airport because appropriate
Bucharest turns operations green Bucharest Airports National Company has been certified by Airports Council International (ACI) with the Airport Carbon Accreditation Level 3 Optimisation for Bucharest Henri Coanda International Airport (pictured right). The accreditation is granted through ana-
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lysing carbon emissions and steps taken by airport authorities and infrastructure users. Independent assessors and the accreditation committee is made up of representatives of institutions including the European Commission, the International Civil Aviation Organization,
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premises were not available, but this is changing. Droese says the airport is in a position to sign lease agreements with forwarders, having welcomed Kuehne + Nagel, Ekol Logistics, cargo-partner and Yusen Logistics. He says: “We have signed lease agreements for one building as part of the Cargo City project but further forwarding companies will come as well because we have realised that since the start of construction of the Cargo City that plenty of players are knocking on our door and asking for business opportunities and space in the Cargo City or on the airport.” Droese says this shows there was demand for cargo services at the airport, so infrastructure will be provided, with much “smoother” cargo operations.
No need to drive across Europe
This will be of benefit to companies within trucking distance of Budapest. There are number of prominent shippers, blue-chip companies coming from abroad to invest in central and Eastern Europe and setting up production. Droese says: “They truck their cargo to different airports, which are congested like Amsterdam, Frankfurt or Vienna but these air-
growth to continue forever. The airport is forecasting long-term growth of four to five per cent per year, which Droese believes is achievable if the Hungarian continues to perform as it has done in recent years. Ensuring the airport continues to grow in a sustainable manner will require constant attention from the cargo team by talking to shippers, forwarders, airlines and other industry stakeholders. Kossuth says: “One reason cargo has a bright future is that cargo has a strategic importance to our airport. It has been declared by our management that cargo is importance for our business as passenger operations.” Budapest is not constrained by slot restrictions or night curfews. Kossuth says the airport has space for cargo to grow, adding: “Our management doesn’t have to make decisions about whether to favour passenger or cargo operations. We can have both.” Droese says: “This flexible and liberal aviation regime in Hungary allows us to gain more
business.” Political support is also essential, with Kossuth commenting: “We are in close cooperation with the Hungarian government. Direct flights are very important to support trade between countries. If we have ideas for flights to countries where there is potential, the government jumps in to support us with traffic rights and political talks.” Both Droese and Kossuth are very optimistic about the future of Budapest Airport, with Kossuth saying: “The volumes are there and growing, connectivity is coming due to more airlines with freighters and belly capacity. We now have the facilities and the hardware. We are acting like a host, bringing together market players to find Kossuth the best solutions.”
ports are facing problems. This can benefit us as we are not congested.” Kossuth adds: “It would take a day [to drive to somewhere like Amsterdam], you need two drivers in the truck. It is costly and time consuming, added to the CO2 emissions the long distance trucking is bad for the environment. The roads are getting worse because of congestion, sometimes there are border controls within the EU. This pushes cargo to online solutions like direct flights.” Droese and Kossuth are confident about the long term outlook for Budapest Airport. Droese says: “It was a long way to reach a point where we can say we have finally started construction of Cargo City. This was a project that was desperately awaited for many years among the cargo community in Budapest, Hungary and neighbouring countries.” It involved a lot of hard work but Droese says: “With the new facility we believe we can stabilise cargo operations, we can further improve the quality of service to our customers and our partners. We can gain more volumes with more capacity and more efficient operations, which can convince more airlines to serve Budapest in the future.” Droese is not expecting the double-digit
UNO and Eurocontrol. ACI Europe says: “Henri Coanda Airport received this accreditation as an acknowledgement for the extensive work to reduce carbon emissions, as well as involving their business partners to do the same, as a reaction of the global airport industry to the climate change challenge.”
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ISTANBUL
Erdoğan opens new Istanbu A
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urkish president Recep Tayyip Erdoğan opened the new Istanbul airport with a special ceremony on the 95th Anniversary of the foundation of republic. The first phase of the new Istanbul Airport was completed in 42 months. The airport boasts two runways. The opening ceremony saw Turkish government officials joined by foreign political guests to inaugurate the airport. Among those present were the presidents of Albania, the Kyrgyz republic, Kosava, Northern Cyprus, Moldova, The Republic Of Serbia and the Bulgarian prime minister. The Istanbul Airport Economic Impact Report prepared in 2016 suggests that the economic value created of airport-related activities in 2025 will correspond to 4.89 per cent of Turkish GNP. The first flight following the inauguration was to Ankara. The “big bang” aeronautical service transition from Istanbul Ataturk Airport to Istanbul Airport will commence on December 30 and end on December 31.
Paying twice
However, the opening does not excite everyone in Turkish airfreight. Turkey’s freight forwarders body, UTIKAD, expecting sustained improvement now the airport has opened, has one issue with the emerging two cargo hubs – rent. “We are going to have to pay rents twice,” UITIKAD president Emre Eldener told Air Cargo Week in an interview. Istanbul Grand Airport, (IGA) a state of the art facility formally opened on October 29 whilst the city’s former airport, Ataturk, will become a designated cargo hub – a move which requires freight forwarders to run two operations, hence face two rent bills for the foreseeable future.
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President Recep Tayyip Erdoğan at the opening ceremony
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erging operations with new airport
“Both of them are expensive,” says Eldener who reported office rents of €100 per square metre per month. Whilst the official line is the two facilities will operate only for one year before being merged at IGA there is some skepticism in the industry it could lengthen. “Let’s hope it’s only one year,” Eldener told Air Cargo Week. “It’s best to consolidate all services in one place.” UTIKAD sees real potential for the air cargo sector with the new capacities IGA offers in terms of space and slots allowing not just growth that might allow some degree of modal shifting out of trucking if more capacity and airlines see rates dip. “It’s a possibility especially for European destinations and the CIS, (Commonwealth of Independent States),” says Eldener.
Driven to dispair
THY looks to join the 100+ club TURKISH Airlines aims to add “at least 16 more” destinations to the 85 it currently serves with its freighter fleet, making it a member of the 100+ Club. Turkish recently started freighter runs to Brussels, Miami, Mexico City, Kigali, Muscat and Taipei but aims to go further still and more frequently with South East Asia and South America very much in the frame. “We are looking for Indochina,” Turkish Airlines senior vice president for cargo marketing, Fatih Cigal, said in an interview specifically mentioning Vietnam, Thailand, Myanmar and Cambodia. In India where it already serves Delhi, Mumbai, Chennai and Hyderabad, Turkish has added Bangalore to its network to serve the pharma market. “We have real interest in Latin America,” Cigal said adding “We are looking for the candidates.” Among those places under consideration is Caracas, a des-
tination he acknowledged was “very challenging,” Quito and Panama City with some US destinations also being considered. It is also looking at Brazil, where it currently flies to Sao Paolo, and plans to “first invest on the current route then we are going to improve our service into new cities in Brazil,” said Cigal. Covering all these new routes will require more capacity and Turkish is currently talking to both Boeing and Airbus with a view to adding between five and ten new freighters up to 2023. What Turkish is leveraging off is not just the extra capacity its new home base airport IGA in Istanbul will give it but the new services it will be able to provide. “It will allow us to strengthen our position in the market especially in pharma, e-commerce and valuables,” said Cigal. Other sectors it is looking at are perishables, live animals, vulnerable products and courier.
Less likely to happen is the easing of Istanbul’s last mile problems – something rarer in the rest of Turkey. In a city of some 18 million people, a lot them connecting consumers, only one of the bridges crossing the Bosphorus, the Northern most one is allowed to take trucks. This creates a situation where goods needing to be moved only three or four kilometres can end up being driven seventy. “You ended up paying more, driving more and delivering later,” Eldener says. However the move which eased congestion in Istanbul is very hard to change, he adds. Istanbul Ataturk Airport, named in the 1980s after Mustafa Kemal Atatürk, the founder and first president of the Republic of Turkey, had been in operating for over sixty years and was the second airport to serve the Turkish city.
Istanbul now an international air logistics hub for the region TURKEY’S e-commerce trade look set to consolidate regionally before moving onto the global stage, ETID, the Association of Turkish Internet Retailers’ chairman Emre Ekmekci told Air Cargo Week. A key part of this process is the new Istanbul airport and Its soft opening on October 29, before it comeson line two months later, December 29, when operations are shifted from the existing, and constrained, Ataturk. “With the introduction of the new airport Istanbul becomes an international air logistics hub for the region and air shipments become cheaper with that investment,” Ekmekci says. The region is the Middle East North Africa and the CIS. Also helping is the quality reputation of Turkish products – those from China are considered cheap - underpinned by an initiative of the Turkish government to underpin quality of exports.
Doorstep market One reason for a more regional focus is it is a large doorstep market – especially the Arab speaking countries. “There’s an awful lot of market in the Middle East, there’s a lot of capacity,” says Ekmekci. “Turkish retailers and brands have already laid the foundation in consumers’ minds.” A market ETID is keen to develop is the local one – which is young and web-savvy although a sizable percentage remain unbanked. There are few last mile problems caused by infrastructure – the exception being congested and bridge restricted Istanbul which can make short hops into long hauls. “Turkey is very young. There is a digital generation of ten million people expected to come of discretionary spending age” he added. “We have a huge population driving this,” he added.
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ACW 12 NOVEMBER 2018
9
OVERSIZED CARGO
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Volga-Dnepr saves plane stranded in the Azores
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olga-Dnepr Airlines used its AOG (aircraft on ground) service to deliver a new engine to an Air Caraibes Airbus A330-323 stranded in the Azores. An IL-76TD-90VDs was dispatched with a team of AOG specialists organising delivery of the replacement aircraft engine from Paris Orly Airport to Lajes Airport on Terceira Island, where the A330 had made an emergency landing due to engine issues. The second IL-76 flight transported the damaged engine back to Orly for maintenance work and restoration. The process involved in managing the charter request followed standard procedures established by the AOG service, which was launched to manage the delivery of urgent spare parts to stranded aircraft. Volga-Dnepr Group vice president for sales and marketing, Robert van de Weg says: “Our 28
years of experience and expertise, as well as our unique freighter fleet, enables us to guarantee the prompt and high-quality response needed in these situations. “We see an increasing demand for our AOG service and will continue to expand the boundaries of our services, embracing new solutions and technologies for the benefit of our customers.” Volga-Dnepr Group, in concert with strategic partner CargoLogicAir, announced the introduction of a new AOG service during the Farnborough International Airshow this year. Volga-Dnepr Airlines and AirBridgeCargo – both part of Volga-Dnepr Group - have completed around 800 deliveries of aerospace equipment in the first nine months of 2018, including satellites, aircraft engines, and spare parts, and also operated more than 15 charters in response to AOG situations.
ABC is latest airline to join IATP AIRBRIDGECARGO Airlines (ABC) has officially joined International Airlines Technical Pool (IATP). The airline was presented with its membership certificate during the 118th IATP Conference held in Indonesia. “With our vast experience in oversize cargo transportation, extensive route network, and qualified team, and stocks of spare parts in several stations, we would be able to support our
partners in any AOG situation,” said AirBridgeCargo Airlines general director Sergey Lazarev. IATP is an international association, with 114 airline and 36 associate members, which was established to streamline maintenance pooling activities during AOG situations. ABC recently transported its 500th aircraft engine in 2018 as demand for abcXL product expertise grows, says the airline.
Oversize cargo on the outside
AT Long Beach Airport in California, Virgin Orbit’s LauncherOne rocket has been integrated with its carrier aircraft, a former Virgin 747 marking a major milestone on the path to the innovative small satellite launch service’s first space shot. The LauncherOne rocket is air-launched. Rather than lifting off from a launch pad on the ground, LauncherOne is first carried aloft by a customised 747-400 aircraft dubbed “Cosmic
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Girl,” which was modified explicitly for the purpose of serving as a flying launch site. Virgin Orbit CEO Dan Hart noted: “The fact that we shipped a rocket on this route, positioned it under the aircraft, integrated the system, and verified that that it all works together for the first time all within a single day still astounds me. In the traditional aerospace world, doing all of that would have taken weeks.”
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