ACW 23 July 18 by Azura International

The weekly newspaper for air cargo professionals No. 991

23 July 2018

FARNBORO’ REPORT

We were there so you didn’t have to be.

ECS MOVES TO ITS SAMBA BEAT

Liege is the place to be

Exclusive: Paris-based GSA expands in South America with BCS Air acquisition

By Donald Urquhart

CS Group has added a precious jewel to its global crown with the acquisition of BCS Air, Brazil’s leading GSA, helping firm up its footprint in South America. The acquisition clearly cements ECS’ position in South America as the dominant international GSA group on the continent, says ECS Group regional manager for LATAM, Jesus Escolar. The addition of BCS Air could be seen as filling a crucial blank spot in the global map for ECS, if it

were not for the fact the global GSA group has – like most of its acquisitions around the world – had a long and personal prior relationship. For Escolar, the deal is particularly sweet as his relationship with the family-owned BCS Air goes back nearly 22 years through his own Spain-based GSA, Gen-Air, that was acquired by ECS in 1999. “It’s really important for me, I was really very, very happy to make this deal. I’m very proud of that and I am sure also the group is really happy,” just as BCS is to be part of the ECS Group, he says. Pointing to not just the portfo-

AID FLIGHTS NEED TO GET THEIR PRIORITIES RIGHT

lio depth and longevity of airline contracts, averaging an impressive 12 years in length, and their very “solid” position in the Brazilian market, Joao Ferreira, managing director of BCS Air says: “We have a very experienced team that brings credibility to the programme – we’re a very clear, reliable partner especially in terms of compliance and governance.” Along with Argentina, ECS has a major presence in Latin America, including Mexico, Columbia, Ecuador, Peru and Chile. And there’s more news yet to come for Latin America as ECS

DRONES ARE COMING SOONER THAN YOU THINK

Full story pages 4,5 & 6

aims to establish a presence in Central America – Costa Rica and Nicaragua – before year-end. “We are now the leader for the international GSA groups in South America because our competitors have offices but are not really active in the main markets,” Escolar says. “We saw an opportunity of joining ECS and taking advantage of their management professionalism, innovation culture and synergies between our companies,” says Ferreira, the eldest son of the founder. Continued Page 2

SUCCESS IS NO FAIRY TALE FOR DENMARK

VOLGA-Dnepr Group and CargoLogicAir have signed a memorandum of understanding with Liege Airport to strengthen their positions in the European market through development of a regional hub. Within the next three to five years the parties will establish a regional hub with the provision to handle up to 30 cargo flights per week, including special cargo. All flights will be supported by maintenance facilities to be organised on the airport’s premises. The Belgian airport will support both companies in opening up new routes and establishing communication channels with government authorities for smoothing operations with other airports in Europe and worldwide. Liege Airport will also provide Volga-Dnepr and CargoLogicAir with ground handling, warehousing and office areas for smooth coordination and operation of freighter flights.

THE first BelugaXL took to the skies in Toulouse, France at 10.30 local time for its maiden flight on Thursday 19 July. The first of five BelugaXLs will enter service in 2019, gradually replacing the BelugaST.

60 SECONDS WITH ... JOHN BATTEN

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NEWS A

Delta and Korean Air in cargo jv launch

orean Air Cargo have launched their cargo cooperation following the start of their joint venture partnership on trans-Pacific routes. The joint venture routes will allow customers to work with either carrier to transport shipments across a range of flights, providing access to more than 290 destinations in the Americas and more than 80 in Asia. It builds on nearly two decades of close partnership between Korean Air and Delta who were both founding members of the SkyTeam global airline alliance. Delta Cargo vice president, Shawn Cole says: “The Delta and Korean Air JV means increased joint belly cargo capacity across the trans-Pacific as well as future co-location of key facilities, worldclass reliability and the industry’s best customer service. “The partnership also means a host of new destinations with commercial and logistics solutions across Asia and North America for these important markets.” Korean Air senior vice president, head of cargo business division, Samsug Noh says: “We are excited to partner with Delta to create an unrivalled air cargo network across North America and Asia. This is bolstered by Korean Air’s leading trans-Pacific air-

Southwest Cargo starts flying to Mexico

outhwest Airlines Cargo has started its international shipping programme with services between the USA and Mexico City. It passed the milestone on Sunday 15 July and later this summer it intends to add the ability to ship between the USA and Cancun, Puerto Vallarta, and Cabo San Lucas/Los Cabos before adding other international destinations to its network. Southwest vice president of cargo and char-

ters, Matt Buckley says: “Our teams have been hard at work getting ready for this historic milestone, and now we’re set to take our award-winning cargo services to places we’ve never been able to reach before.” Houston Airport System director, Mario Diaz says: “We applaud Southwest Airlines’ decision to expand cargo operations between Mexico City and Houston Hobby Airport. This move takes advantage of Houston’s growing logistics expertise and adds strength to the Houston economy.”

freight network, as well as Delta’s nationwide schedule and sales network within the US. “The partnership will further strengthen our capability to offer an unequalled expertise on all aspects of air cargo transportation.” Delta and Korean transport a range of products in the trans-Pacific market, with semi-conductors, perishables and e-commerce from the US, and mobile phones, automobile parts and other electronics going the other way

Hactl first with IATA handling audit system

HONG Kong Air Cargo Terminals Limited (Hactl) is the first cargo terminal operator (CTO) in the world to complete a pilot for IATA’s new Smart Facility Operational Capacity Audit (SFOC). SFOC is part of the Smart Facility program which aims to provide total transparency on capacities and services offered by CTOs, by means of a multi-tiered validation process. Hactl was chosen as the launch test site for the new audit system because of the scale and complexity of its operations, the diverse range

of cargo it handles, the number of carriers and the company’s management systems. “The SFOC pilot with Hactl was successful. The feedback received was valuable in fine-tuning the audit questions, auditor actions and guidance ensuring a consistently high audit quality across the program,” says IATA global head of cargo Glyn Hughes. Further SFOC pilot audits are to be conducted at locations in London, Luxembourg, Singapore, Amsterdam and Dubai throughout 2018.

ECS Group moves to its samba beat Escolar

From Page 1 Escolar adds that aside from BCS’ well established position in the market - which counts numerous airlines in its portfolio including Cargolux, Turkish Airlines, Qatar Airways, Japan Airines (offline), LATAM, TAP Portugal, Aeromexico, Delta and others - the team is young but experienced and talented.

ACW REWIND

“And there is a lot of talent and a lot of motivation in ECS which has a lot of energy and a brilliant future. I think the people at BCS are attracted to our innovation culture,” Escolar says. He has big plans for Latin America, and the young and driven team at BCS led by Ferreira, figures greatly into this. “Joao will be one of the important people in my group in the South American market because we are aiming to build a strong group of people,” he says. There are challenges in the Brazilian market, as the recent truckers and customs strikes showed and then here is the political elephant in the room. While things have stabilised, an election in October could be a challenge. “Where there is challenge there is also opportunity for air cargo,” Escolar adds saying he is upbeat on the market going forward.

THE JULES Rimet Trophy was held aloft last week by France. Twelve years ago, Lufthansa claimed the prize of world champion before the first FIFA World Cup ball had been kicked.

Lufthansa: We are on the ball

Vol 9, Issue 22 15 June 2006

ahead of Germany’s imminent role as host to the 2006 FIFA World Cup, a little bit of wishful thinking has led Lufthansa Cargo to already lay claim to be the world football champions - at least when it comes to transporting them. Since the beginning of the year, the German cargo carrier said it had airfreighted more than 3,000 tonnes of footballs. Demand has been huge in the run up to he World Cup and soccer balls are being flown all around the globe from Sialkot in Pakistan,

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which lays claim to being the centre of the football-manufacturing industry. In 2005, over 63 million footballs were made by more than 200 producers in the city on the fringe of the Jammu-Kashmir region. Although 90 per cent of the balls were transported by sea, Lufthansa Cargo has been trucking some of the uninflated balls from Sialkot to Lahore and Karachi where they have been flown to their final destinations on its freighters. That year, after extra time, Italy beat France 5–3 on penalties to win the World Cup.

Air cargo is going with Boeing

irlines got their chequebooks out at the Farnborough International Airshow, making large orders for Boeing’s freighter products. DHL Express signed a deal for 14 Boeing 777 Freighters, with the option for an additional seven on Monday 16 July. The first aircraft is scheduled for delivery in 2019, and DHL says that while the aircraft will not increase capacity, they will significantly reduce costs, increase efficiency and reliability. DHL Express chief executive officer, Ken Allen says: “The acquisition of the 14 Boeing airplanes reflects a gradual replacement of our older intercontinental fleet. As the most fuel-efficient, most reliable freighter type with the best long-haul range, these aircraft will contribute to our emissions reduction targets and allow us to serve even more markets with non-stop flights.” On the same day, Qatar Airways finalised an order for five Boeing 777 Freighters in a deal worth $1.7 billion at list prices, adding to Qatar Airways’ existing Boeing freighter fleet of 13 777s and two 747-8s. The announcement was attended by the state of Qatar’s minister of finance and Qatar Airways chairman, His Excellency Ali Shareef Al Emadi. Qatar Airways Group chief executive, His Excellency Akbar Al Baker says: “I am delighted to be further enhancing our cargo fleet and adding five Boeing 777 Freighter aircraft. In the past 15 years, Qatar Airways Cargo has grown steadily and globally, becoming the third largest in the world. We could not have achieved this success without our resilient relationship with Boeing.”

WorldNews LUFTHANSA is to launch a new twice weekly service between Edinburgh and Munich, as well as adding a fifth daily service between Dublin and Frankfurt when the new winter schedule begins on 28 October. The new Edinburgh-Munich route adds to the two daily flights to Lufthansa’s Frankfurt hub.

says: “With total firm and option aircraft commitments now at fifty 737-800BCFs, GECAS will commit nearly $1.5 billion worth of 737800s with conversions to the narrow body freighter sector.” Boeing Company senior vice president of commercial sales and marketing, Ihssane Mounir says: “The 737-800BCF is a great example of how Boeing’s Global Services business can extend the life of an airplane with new technology and help operators reduce their operating costs.” The agreement, which is subject to GECAS board approval, would take the total commitments for the 737-800BCF programme to 80 from more than six customers.

TIME-CRITICAL logistics specialists GBA Services is expanding its existing involvement in aerospace MRO and AOG work, with the opening of a dedicated Aerospace Division. One of the early projects of the new division is the creation of a dedicated components milk-run service, supporting line maintenance activity by delivering airside to all UK airports in support of airlines and their associated supplier bases. DHL Freight has opened a 30,000 sq m warehouse in Manisa, Turkey in the industrial zone that offers storage and customised, value-added logistics services

Planning for the future

On Tuesday 17 July, Volga-Dnepr Group and CargoLogicHolding signed an agreement to acquire 29 Boeing 777 Freighters, confirmed an order for five more Boeing 747-8 Freighters, the purchase of a crew pairing solution, and an agreement to work together on future projects. After the signing ceremony, Volga-Dnepr Group president and chairman of CargoLogicHolding chairman, Alexey Isaykin said: “This is a very significant day in our company’s history. With this package of agreements, we will grow our business with the unique and unmatched 747-8 Freighter and open new market opportunities with the 777 Freighter, the world’s longest range twin-engine cargo jet.” CargoLogicHolding intends to order 29 Boeing 777 Freighters, valued at $9.8 billion, saying its range and cargo capacity promises to open up significant network and growth opportunities. Isaykin says: “CargoLogicAir, part of CargoLogicHolding, started its business by flying 747 scheduled and charter flights to and from the UK. We are excited to extend the network using a range of Boeing family aircraft including Boeing 747-8F, 777F, 767F and 737-800BCF.” GECAS and Boeing have reached an agreement for 35 additional 737-800 Boeing Converted Freighters on 17 July. The deal, which includes 20 firm orders and 15 options, will take GECAS’ 737-800BCF order from 15 to 50 and enable GECAS to serve the growing express air cargo market. GECAS Cargo Aircraft Group manager and SVP, Richard Greener

Company car for Air Cargo Week staff?

Quote of the week “You have a German asking an Australian about LHR after Brexit.” Nick Platts after being asked about Brexit by a German airport at Farnborough

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farnborough

Boeing: Cargo is back!

he second day of the Farnborough International Airshow 2018 was the setting of the first day of the Cargo Village, a two-day exposition of air cargo companies and conference talks. Launching the programme of talks and panel discussions, IATA global head of cargo, Glyn Hughes welcomed the audience by stressing that the IATA-organised event was “unique for the industry.”

Panellists: (l-r) Turhan Ozen, Turkish; Henk Venema, DHL; Abdulla Shadid, Etihad; and, Marco Bloemen, Seabury Consulting The rallying cry “Cargo is back!” was given by Boeing vice president of commercial marketing, Randy Tinseth in his talk after the coffee break on “the compelling future of air cargo.” The content of speakers was split between Tinseth’s positive handle on Boeing freighter orders – almost 1,000 to be delivered by 2038 – as well as the 1,700 expected Boeing passenger-to-freighter conversions in the pipeline which balanced general issues raised by Brexit,

e-commerce and digitalisation, or rather the lack of it, in the wider industry. In his opening address, CargoLogicAir (CLA) CEO David Kerr talked of his airline’s interest in the Cargo Village concept as a means of getting airfreight “heard”. He descibed his thoughts on how there was a need for many major airports to be more forward-thinking for cargo operators like CLA, and like some of the smaller operations.

LHR’s future more Shadid invests than just Brexit in new career at Etihad Cargo NICK Platts, London Heathrow’s head of cargo, put a positive spin on LHR’s future, post-Brexit, to the Cargo Village audience. Platts came to the podium to talk up the opportunities the recent decision by the British parliament to give the green light to a third runway at Heathrow gave the cargo community. He was bullish that Brexit was as much about doors opening as it was about doors closing. “The new runway will double our airport’s cargo capacity. We have justy enjoyed the strongest year in cargo at Heathrow since the financial crisis,” the Australian aviation veteran said. The airport handled 1.7 million tonnes in 2017. Other themes tackled by Platts included the need for greater digitalisation of air cargo and an end to paper use int he industry: “My children will hate me for using the earth’s lungs for records.” He spoke of his desire to see a suite of KPIs establised for the cargo operation as well as infrastructure improvements that could speed up cargo handling. These could include new road and rail developments to reach the existing or any future cargo village at the gateway.

ACW 23 july 2018

The first panel discussion of the morning was given over to e-commerce. This created a mixed reaction from panellists and audience members, who seemed unable to determine whether e-commerce was a blessing or a curse. One comment from the panel was that e-commerce had created “millions of shippers”, many of whom do not understand or try to get around dangerous goods regulatiuons. Describing a “laundry list” of opportunities arising from e-commerce activity, one panelist did warn that not all e-commence might be worthwhile to pursue. “Some business may be nice to have but some may not,” the panellist said. Despite earlier traffic issues outside the air show that slightly delayed the conference, it was well-attended, with air cargo visitors being joined by those who were attending the air show for the other industries on display. This was evident in the Q&A sessions where questions were posed by those from disciplines outside air cargo.

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Just four months into his new position at Etihad Cargo, managing director cargo and logistics Abdulla Shadid is making his mark at the airline. Arriving from Mubadala Investment Company sovereign investment fund, Shadid is definitely a new broom at the Abu Dhabi-based carrier. He is bringing new disciplines to the cargo team as well as new ways of thinking from outside the airfreight industry. He told Air Cargo Week: “I have had a short period to learn. It is important to me that a team spirit is developed. That is why I describe it as ‘human capital’ not ‘human resources.’ He is looking to create an evolution “not a revolution” at the carrier’s cargo operation . He adds that one of his key drivers will be the idea that an airline cannot be in “play for everything. It cannot do an A-Z of activities and be good at everything.” Shadid, a graduate of Universtity College, London, also oversees Etihad Cargo, Armaguard Valuables Management (AVM) and Etihad Global Cargo Management Company (EGCMC).

farnborough

Aid flights need to get their priorities right

system will be in place by next February to prioritise certain flights when aid is needed following a humanitarian crisis, it was predicted at the Farnborough Airshow. DHL vice president of humanitarian affairs, Chris Weeks (pictured standing) made the bold claim during the Cargo Village Conference during the session “Future of Humanitarian Air Cargo Supply Chains” on Wednesday 18 July. Panellists were discussing the issues faced with flying aid including corrupt local officials and the inefficiency of the aid industry. He explained to delegates that throughout the 1980s and 1990s DHL had been asked by NGOs to move aid around the world but frequently airports were in a chaotic situation. Matters came to a head in December 2003 when an earthquake struck Bam, Iran. Weeks said: “A colleague told me the place was chaos, aircraft were arriving, trucks were driving around the airfield, stuff was getting spoiled. He asked what were we doing spending money moving more stuff into a chaotic place. It was a seminal moment, we needed to forget about carrying for everybody but put resources onto the ground.”

DHL to the rescue

DHL set up disaster response teams who volunteer to clear goods on the airfield to ensure aircraft can safely move goods in. The volunteers do not get paid but they know what they are doing and help the airport manager clear the goods. In the downtime they help disaster-prone areas prepare for disasters with workshops, which led him to attending an ICAO workshop where the issue of preventing log jams at disaster airports was discussed. The point was raised that there is no prioritisation system for air traffic control to let in the most urgent flights in first. Weeks predicts: “By next February we hope to have a prioritisation system in place using NOTAMs prioritising search and rescue flights first, followed by health workers and then construction. They would receive slots in a logical and orderly manner.” The lack of aviation knowledge among the aid community was also a concern raised by speakers, with inefficient processes often slowing and stopping aid from reach those in need. Aviation Sans Frontieres International general secretary, Pauli Immonen (pictured second right) highlighted a number of natural disasters including earthquakes and floods in Pakistan, the earthquake in Haiti in 2010 and the 2015 Nepal earthquake where there were battles with unhelpful local officials.

Local issues

He told delegates: “Landing rights can be a problem as the airport can be nasty, customs can be nasty, official want a bribe, there are a chain of state actors who can complicate lives, ground handling people can be greedy pushing fuel tax up by 100 per cent. For a 10 hour Boeing 747 flight that can be a significant increase.” Prices for aircraft vary depending on demand, a bit like the price of a holiday, and he asked the audience whether it was fair for airlines to go far above what is seen as reasonable, saying he had seen some very unreasonable charter prices. The aid industry does not help itself due to a lack of aviation knowledge and joint up work, including the same organisation tendering for the same destination, causing prices to rocket due to the demand. He said he could spend hours giving examples of the aid industry’s inefficiency and mistakes in the aviation industry but decided to limit it to a few. Examples included an NGO chartered a blacklisted aircraft, another who had 100 tonnes of aid to move so chartered an aircraft with a 100 tonne payload but not thinking that separate flights with a smaller aircraft could mean significant fuel savings, loading aircraft inefficiently so the maximum take off weight was reached without filling the space or the space being filled but considerably below the weight capacity. Immonen said some are seeking publicity rather than truly helping out, saying: “Sometimes they want to be first on BBC News.” He added: “There is a need to be smarter both in the aid and airline communities. In the air cargo community few have the expertise in refugee camp management and few in the aid industry know how to operate a 747. We need to talk in advance and not during an emergency.”

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FARNBOROUGH

Drones are coming sooner than you think

rones are coming and will be flying into cargo fleets very soon, panellists on the discussion “New Routes to Market – The Future of Unmanned Aircraft” claim. The panellists for the discussion on 18 July were (seated from left to right) Natilus founder, Alexey Matyushev; Dronamics co-founder, Svilen Rangelov; and Falcon Drones Technology UAV development engineer, Pau Martinez Prat. They predict that drones could be part of the air cargo fleet within the next 10 years. Prat said: “We are developing a fixed wing unmanned aircraft with a 250 kilogramme payload and 1,000 kilometres of range. We believe that in rural communities and in humanitarian crises it can be a game changer lowering costs by a factor of 10.”

He claimed the product has an automated system that is very easy to scale, requires minimal training and will reduce costs. Dronamics is developing an unmanned air vehicle called “The Black Swan”, which can transport 350 kilogrammes of cargo at a distance of 2,500 kilometres cheaper than any aircraft in existence.

Long-term solutions

Rangelov said: “With vision you need to consider longer-term solutions. We are testing a quarter sized model. You will be familiar with pilot shortages going forward, future unmanned or automated flights ease the pressure affecting whole spectrum.” He also said that packages make very few

demands when in the air, unlike passengers who require food and water, so there is no need for humans to accommodate them. Rangelov predicts that drones will see early adoption before 2025 and unmanned vehicles and drones will be a regular part of operations by 2030. Prat is expecting it to happen sooner, saying: “The technology is ready but we need clear regulations. Depending on the environment in non congested airspace we could see them in remote areas by 2020 and commercial markets by 2025.” Panel moderate Des Vertannes raised Boeing’s growth outlook, saying that the potential of the future of unmanned aircraft was not mentioned once, saying have the potential of triggering further growth.

He told the audience: “One benefit we could see is outreach to rural communities in Africa and Latin America or humanitarian relief. A question is who would pay for these services and operate the equipment. Commercial benefits are a challenge and we need to make sure there is a return to operate these types of vehicles.” Prat believes there is a good business case due to cost issues, pilot shortages and pilots not wishing to fly certain routes, and last mile deliveries in remote areas. He says unmanned vehicles could be a “gamechanger”. He says: “It doesn’t make sense to use helicopters or manned aircraft to just deliver medical supplies, same with delivering low volumes of cargo. Sometimes remote areas need more frequency but lower volumes.”

Airbus to develop medical drones

AIRBUS and International SOS signed a memorandum of understanding to jointly study the viability of using drones to deliver medical cargo and supplies. The agreement was signed on 18 July at the Farnborough International Airshow, and Airbus will help to define and install reliable unmanned aerial medical cargo deliveries as part of International SOS MedSupply services. MedSupply deploys medical supplies, specialist medical care and equipment to meet the requirements of preventive health programme or in support of a medical emergency in urban as well as unfamiliar and remote locations. The studies will examine both urban to rural and

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ship to shore deliveries. Airbus and International SOS will collaborate on safe, secure and enterprise drone delivery for hub to hub distribution of medical cargo, compliant with local regulatory bodies. Airbus Defence and Space chief executive officer, Dirk Hoke says: “We hope to develop a viable business partnership where we can assist International SOS with unmanned medical cargo delivery. This means using our cutting edge technology to potentially save lives, and transform the medical and travel security industry.” International SOS chairman, co-founder and chief executive officer, Arnaud Vaissie says: “Bringing together the Airbus expertise in securing aerial deliveries, and our global infrastructure assisting clients worldwide, is a clear move towards a greater efficiency.“ Potential medical cargo delivery pilot cases are being explored in Singapore and Indonesia, and Airbus and International SOS will work with the local civil aviation and maritime authorities to develop these capabilities.

cool chain

AFKLMP’s digital solutions to pharma

ir France KLM Martinair Cargo (AFKLMP) is investing in greater transparency for pharmaceutical shipments through its digital myCargo platform. Customers can use myCargo to track the current temperature, the battery level in the dry ice units, and the voltage in the active containers during transit at Amsterdam Airport Schiphol and Paris Charles de Gaulle Airport. Global head of pharmaceutical logistics, Enrica Calonghi (pictured) says: “Our customers can now get quotations, information about the latest and best deals, and do their booking via AFKL Cargo’s digital platform myCargo. “After a period of tests in several European countries we have started the rollout of this important tool, which we are already using widely for general cargo, also for pharmaceutical logistics.”

She says pharmaceutical containers are checked during contact points at hubs, at the origin and destination, saying: “We want to enable our customers to monitor the checks and actions we have been performing. And, how cool it would be – pun intended – if we can expand the transparency of the temperature for all Pharma products on the short term.” AFKLMP says it expects to roll out the tool to increase visibility for all customers by the end of the year. The operation boasts of having have the highest compliant Pharma network worldwide with nearly 300 stations. Two years ago it became the the first major airline group to receive the IATA CEIV Pharma Certification for its hubs in Paris and Amsterdam, and related airline processes. CEIV certification included the EU Guidelines on Good Distribution Practice of Medicinal Products for Human Use and WHO guidelines.

Calonghi

Appointment at the Palace for Peli BioThermal DIRECTORS from Leighton Buzzard, UKbased temperature-controlled packaging manufacturer Peli BioThermal, attended a prestigious regal reception hosted by HRH the Prince of Wales and other members of the British royal family. The royal reception celebrated the company as recipients of the Queen’s Award for Enterprise: International Trade 2018. The leadership team members attended the royal reception whcih was exclusively staged for winning businesses, including Peli BioThermal. This was the company’s second successive Queen’s Award in a row, This accolade added to its previous award for innovation for its Chronos Advance, which had been presented to the company in 2017.

Cinven to acquire Envirotainer

PRIVATE equity firm, Cinven has acquired all shares in Envirotainer from majority shareholder AAC Capital for an undisclosed sum. The transaction for the supplier of temperature-controlled airfreight solutions for the pharmaceutical supply chain will be formally closed when all relevant financial regulatory filings have been approved, estimated by late summer or early autumn. Envirotainer chief executive officer, Michael Borg says: “Cinven is one of Europe’s leading private equity firms, with substantial activities in healthcare and a strong Nordic track-record.” Cinven partner, Pontus Petersson says: “Envirotainer is the clear leader in a market segment we believe is very interesting, and the company consistently delivers strong growth and high performance. We are very happy to be part of Envirotainer’s continued future development.”

SkyCell and Dupont in strategic alliance

SKYCELL has entered into a strategic alliance with DuPont to collaborate on technical and market developments. Under the agreement, DuPont will gain access to SkyCell’s remote temperature management solutions and expertise and acquire marketing rights to the SkyCell portfolio of insulated shipping containers. SkyCell containers will be marketed by DuPont alongside its Tyvek products and SkyCell will tap into the technical resource of DuPont. Tyvek and Typar vice president and general manager, Christian Marx says: “There is a strong fit between DuPont and SkyCell and we see this as complementing our Tyvek Cargo Covers offering and expanding market capability in an increasingly sophisticated pharma supply chain.” SkyCell chief executive officer, Richard Ettl says: “With a vision of better leveraging the supply chain, this partnership will help us pensure medicines, vaccines and other treatments get to the final patients in a safe, sustainable and timely manner.”

Panalpina extends Perishables Network to South Africa

PANALPINA is extending its Perishables Network to South Africa by acquiring a majority stake in Skyservices, which has operations in Johannesburg and Cape Town. Skyservices runs a 2,000 sq m warehouse inside OR Tambo International Airport in Johannesburg and a 1,700 sq m warehouse just outside Cape Town International Airport. Panalpina regional CEO for the Middle East, Africa and the CIS, Rafic Mecattaf says: “Today is a day of celebration, and the beginning of an exciting journey. South Africa is a land of opportunity and we see a significant growth potential for perishables in this country.”

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south america

Emirates sees big potential in South America

outh America has long been touted as one of the world’s most promising emerging markets. Brazil even supplied the ‘B’ for the oft-quoted ‘BRICS’, alongside Russia, India, China and South Africa, writes Neil Madden. But over the past decade, Brazil and many of its neighbours have seen mixed economic fortunes, which have disappointed the region’s protagonists. Now signs are that things are moving in the right direction once more as consumption and exports are driving renewed economic growth across the region, with the lamentable exception of Venezuela. LATAM Cargo even took the bold step earlier this year of committing to four additional freighters to bring its fleet to 12 by 2020.

And despite the ups and downs of the region, carriers from further afield have continued to invest in growing services to and from the continent. Emirates SkyCargo has seen a steady rise in South America volumes over the years. Little wonder then that the region is one of the carrier’s focus areas where it sees great potential for further growth. “Between 2007 and 2017, we moved over 36,000 tonnes of cargo from Brazil,” a spokesperson tells Air Cargo Week. “From markets such as Ecuador we have seen our volumes of flowers carried on freighters growing over the years. Between 2015 and 2017 we carried a total of more than 33,500 tonnes of flowers from Quito on our freighter flights. And for Argentina, over the same period, we have

carried around 13,000 tonnes of cargo.” In June, Emirates SkyCargo added the Chilean capital Santiago to its rapidly growing network in South America, which now numbers seven destinations.

New destinations

“Our recent launch of the service to Santiago has allowed us to expand our network and offer more cargo capacity to the South American market. We continue to closely monitor and evaluate market conditions to ensure that our capacity is deployed where there is demand,” the spokesperson adds. Across the continent, the carrier flies a twiceweekly B777F service to Viracopos, in Sao Paolo state, Brazil, four times a week to the Ecuadorian capital Quito, and once a week to Ciudad del Este, Paraguay. These freighter services are supplemented by belly space on A380 and B777 passenger flights to Sao Paulo and Rio de Janeiro, Buenos Aires and now Santiago. “On these (passenger) services we are able to offer cargo capacity of up to 15 tonnes per flight,” the spokesperson says. “We have daily passenger flights to Rio de Janeiro and Buenos Aires; a five-times-a-week service to Santiago with the flights stopping at Sao Paulo in addition to daily flights to Sao Paulo. In total we offer over 450 tonnes of weekly capacity to South America.” The products that Emirates imports and exports out of the different stations in South America are diverse. The flowers from Quito, for example, are freighted directly to Amsterdam where they are auctioned in the world’s largest flower market. “Out of Brazil, major exports include general

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cargo, hatching eggs, spare parts, shoes, fruits and vegetables and major imports include automobile and aircraft spare parts, cosmetics and pharmaceuticals,” the spokesperson continues. “We have also operated multiple freighter charters to Brazil over the past few years to transport various types of cargo – including horses for leading sporting events and outsized equipment such as helicopters.”

Perishable exports

As far as Argentina and Chile are concerned, the market is pretty much given over to perishables. Ex-Argentina the main exports are cherries and various kinds of berries, salmon, and leafy vegetables, such as asparagus. The addition of Santiago is seen as a good opportunity to facilitate growing exports of salmon to fast-growing consumer markets in the Middle East and East Asia. Chile is the world’s second largest producer of farmed salmon and exports from the country were valued at over $4.6 billion in 2017. Emirates says the new service will also offer one of the fastest flight connections for cargo from Chile to destinations in East Asia, including Shanghai, the Middle East and Russia through Dubai. The carrier has a suite of specialised services for perishable cargo – Emirates Fresh – to help ensure the freshness of Chilean salmon and fruits during transit. The cargo terminals in Dubai also have extensive cool chain facilities including dedicated temperature-controlled storage areas and equipment such as Cool Dollies and thermal blankets to ensure cargo is well protected against thermal radiation. The main import commodities into Santiago are expected to be e-commerce shipments from East Asia.

SOUTH AMERICA

HAE Group looks to expand into ‘difficult’ markets

K air cargo services group HAE has been established in South America for five years now. Yet, the firm’s president for the Americas Ian Hutchinson tells Air Cargo Week that the market is still growing and new opportunities continue to present themselves for on- and offline network business and difficult to serve markets. From its original base at East Midlands Airport, UK, HAE has added offices in Brazil, Chile, Peru, Argentina and Colombia to its global network. “Our South American business is based Hutchinson around GSSA and

‘solutions’,” says Hutchinson. Among those solutions, for example, is HX, an IATA airline product, operated by Aztec Airways, that allows the group’s teams to put together a route using any number of airlines with just a single master airway bill and construct a bespoke routing that best fits the requirements for the cargo in question. Apart from Aztec Worldwide, HAE works Etihad, Ethiopian Airlines, Air New Zealand, Swiss World Cargo and China Airlines Cargo. Hutchinson says flexibility is the key to much of doing business in South America. “(Product groups) are driven by each market as we believe each country is distinct,” he points out. “For example, Chile has strong perishables trades all year round, whereas Brazil and Colombia are built more on hard freight products.”

Santiago de Chile

South American airports on the rise SOUTH American airports operated by Corporacion America have experienced very strong first half growth, with double digit growth in Argentina, Brazil and Ecuador. The private sector airport concession operator, which operates 37 airports in Argentina, two in Brazil, two in Ecuador, five in Peru and two in Uruguay reports that cargo volumes increased 4.7 per cent in June driven by Brazil growing 30.2 per cent to 5,731 tonnes and Ecuador was up 36.7 per cent to 3,494 tonnes driven by better economic conditions. In June,

Argentinian airports were down 5.4 per cent to 16,133 tonnes, Uruguay also fell by 4.1 per cent to 2,226 tonnes and Peru was up 5.6 per cent to 402 tonnes. Across its airports, in the first six months of 2018 volumes increased by 12.3 per cent to 196,750 tonnes. Argentina was up 17.1 per cent to 117,042 tonnes, Brazil by 15.2 per cent to 29,781 tonnes, Uruguay dipped by 0.1 per cent to 13,551 tonnes, Ecuador increased by 19.7 per cent to 20,533 tonnes and Peru was up by 2.2 per cent to 2,358 tonnes.

GOL MAXimises 737 order

BRAZILIAN carrier GOL Airlines has converted 30 Boeing 737 MAX orders to MAX 10s and has placed an order for 15 more MAX 8s. The deal means GOL has 135 MAXs on order, and will help it enhance operational efficiency by flying a young, modern and safe fleet. GOL chief executive officer, Paulo Kakinoff says: “This new order aligns with our strategic

policy of reducing operating costs by operating a standardised fleet. We are confident that the 737 MAX 10 will offer significant competitive advantages for GOL and enable us to continue to modernise with new aircraft.” GOL took delivery of its first 737 MAX last month, kicking off a fleet renewal that will continue through to 2028.

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ACW 23 JULY 2018

denmark

Success is no fairy tale for Denmark

hen it comes to Danish airfreight, Copenhagen airport dominates. It handles 90 per cent of total Danish exports and imports compared to other airports in the country and is used by global logistics providers such as DHL, Kuehne & Nagel and Fedex as their Nordic airfreight hub, writes David Craik. In 2017, the airport handled 365,431 tonnes of air cargo compared with 347,000 in 2016. To the end of May 2018, it has handled around 114,000 tonnes. It has been boosted by new direct routes between Denmark and emerging economies such as Air India to New Delhi, Cathay Pacific to Hong Kong and Air China to Beijing. Worldwide Flight Services, the world’s biggest air cargo handler, has also opened a new

temperature-controlled facility in Copenhagen and won the contract to handle the cargo operating on the three times weekly Air India Boeing

787 flights to Delhi. Further growth is expected at Copenhagen. Last year its plan for a proposed Airport Business Park was approved meaning it will build an area of 150,000 square metres for a logistics park, doubling air cargo capacity from 500,000 to one million tonnes annually. Last November, Copenhagen also signed an agreement with the German developer AXXUS Capital to develop a brand-new air cargo centre occupying around 20,000 square metres and with a big focus on refrigerated and pharmaceutical facilities. “We see huge potential in developing air cargo at Copenhagen. In the coming years there will be an even greater need for air cargo facilities for handling the growing cargo volumes to and from China and other places,” said Axxus CEO Markus Wolf at the time. Head of supply chain and logistics, Paul Dhami at Copenhagen Capacity, which drives investment in Greater Copenhagen, says both the airports and surrounding infrastructure is driving present and future demand.

Easy access

“The airport is growing rapidly including the Airport Business Park and Axxus development, but we are also seeing more infrastructure improvements in railways, tunnels and motorways connecting Copenhagen with other Nordic countries and to Germany,” he says. “Norway and Southern part of Sweden use Copenhagen Airport for air cargo due to its connectivity worldwide and improvements in infrastructure and logistics parks. The easy access to sea- and airport and fast customs clearance also play an important role, which were some of the decisive factors for Unicef placing one of their global warehouses in Copenhagen.” He adds: “The Nordic region is the fourth biggest purchaser of e-commerce goods in Europe boosted by our advanced digital infrastructure and broadband coverage. Again, this is driving air cargo demand and logistic investments from global providers into Copenhagen.” Aarhus-based freight forwarder Martin

ACW 23 july 2018

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Bencher entered the air freight market in 2014 and has seen an ever-increasing demand for its services. “Many of our clients use us for big project movements of cranes and other big machinery,” says Martin Bencher general manager for airfreight Mikkel Kristensen. “[Our clients] recognise that airfreight means shorter transit times than at sea. That has been a real driving force behind or growth.” Kristensen says airfreight volumes have jumped by around 50 per cent in the last 12 months compared to an overall Danish air freight rise of 15 per cent. “Our main customers are manufacturers, paper industry producers moving machinery, wind energy firms, aircraft parts and automotive. We are moving these products to primarily Asia but also the US, South America and the Middle East. Danish companies are in greater demand from global markets especially wind turbine components which are heavily produced in Denmark.” Bollore Logistics has also shown appetite for expansion in the Danish market. In January it took a majority stake in Danish freight forwarder Global Solutions to help it better serve its key Danish and Scandinavian customers. “We support DanDhami ish companies in their international development and logistics projects, particularly in Africa,” Bollore Logistics CEO Europe Henri Le Gouis, said at the time. Speaking to Air Cargo Week, Bolloré Logistics current managing director of global solutions Thomas Toubro, adds: “Being the biggest logistics provider in Africa with its own offices in 46 countries for aid/relief and commercial business will be a natural area for us to grow. We are already in talks with leading Danish companies on business to Africa in shape of projects and demand for warehousing/distribution. The group holds large contracts with airlines to the African continent that we can use.” It is also seeing growth in ecommerce, electronics and textiles. Indeed. Toubro personally visited Myanmar earlier this year after identifying it as one of the countries to where textile production could be moved to from Denmark. “Bolloré Logistics is present in the country with both sea, airfreight and excellent warehouse operations and we believe that a number of European companies looking into Myanmar options,” Toubro says. “With China focusing on the domestic market some Danish companies have moved or considered moving production from China to other areas in the Far East or even pulled back to Europe.”

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aircargoweek.com 11_23 July 2018.indd 1

ACW 23 july 2018

11 18/07/2018 11:49

he pretends to know what he’s talking about

Seconds with...

ACW: You have over 35 years’ experience in senior positions in the aviation industry. In that time, what has changed for the better and what has changed for the worse? Batten: I have got older and wiser realising that this business doesn’t like change or fails to implement changes through a lack of systems or trust. Today we still do not have a universal cargo measurement system or e-AWB and systems still do not talk to each other. It is amazing really as one of my first jobs was with an integrator/express operator and the airlines and forwarders were all fearing them. In reality, the forwarder was actually faster but couldn’t prove it. Today, the Amazons of this world are challenging the integrators when the freight forwarders thought they were the gods, so a full circle transition. Because time stands still, technology will overtake you. ACW: As WFS EVP Europe, Middle East, Africa & Asia, how much of this territory can you actually visit in a year? Batten: All and more. I have a management team that I trust and rely on them a fair deal. I am not the one that makes the difference although it is always nice to visit an operation and meet the people.

john batten

A record business as a teenager resulted in a career in the air cargo industry lasting over 35 years across the express, airline and cargo handling sectors. He joined WFS in 2015, taking the role of EVP for Europe, Middle East, Africa and Asia in 2017. He spoke to Air Cargo Week about how the industry has (and has not) changed, the future of WFS and supporting Chelsea.

ACW: As EVP EMEAA Cargo, is there anything left for you to learn? Batten: I learn every day and never underestimate your learning potential. We have some great people in this business and optimisation and technology are ‘forever’ learning situations.

ACW: Any surprises since you have become EVP? Batten: The biggest surprise about this business is its inability to move forward as fast as it should. It is very frustrating. We work years on improving technology such as Cargo2000/CargoIQ and people still don’t see the real benefits. WFS is working on a new dashboard to allow airlines to drill down on our handling performance to address operational problems and improve overall quality, which will go a long way towards supporting the airlines’ performance statistics. ACW: What do you see as the key requirements to get the most from your staff? Batten: I try and be a leader rather than manager and as such people are empowered to run the business. I am there to support them. I try to work on honesty and trust! It is good to

incentivise people on performance so they go the extra 10 miles to deliver.

Batten: I had a record business at 16 and got into airfreight and express through this business looking for innovation to sell my records before my competitors, so I didn’t expect to grow up into this field but it is the most enjoyable area to work and this is my second time around. ACW: Steak or spaghetti? Batten: Steak.

ACW: Fish & chips or chicken tikka masala? Batten: Both, I have a passion for fish & chips whenever I am back in London but also adore Indian food, which is easier to get worldwide these days, although not always as spicy as I like!

ACW: In terms of WFS, what are the main opportunities you see over the next five years? Batten: We are about to put a team together to deliver Project 2022, which will be totally different to what a handler has delivered in the past. It captures all suggestions our customers have made over the last few years, and then adds some more. It will be innovative and I also want to be in a position to deliver the first parts in 2020. ACW: What’s the most interesting thing about you that we wouldn’t learn from your CV alone? Batten: It wouldn’t be interesting if I told you! ACW: We finish the interview and you step outside the office and find a lottery ticket that ends up winning £10 million. What would you do? Batten: Collect the winnings and go back to work. I would still be doing this if I won £100 million.

ACW: Rugby or football? Batten: I love both and have the ability to watch them together as Rugby is more about the national country view. My football team is Chelsea so I have no expectations these days. ACW: What was the last film you saw? Batten: The Darkest Hour – great film, and prior to that Dunkirk was so very inspiring. ACW: What did you want to be when you grew up?

john batten

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