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The weekly newspaper for air cargo professionals Volume: 20
Issue: 8
27 February 2017
Industry hails ratification of WTO’s TFA
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orld trade and the air cargo industry have been given a boost after the Trade Facilitation Agreement (TFA) came into force on 22 February. Ratification of the World Trade Organization (WTO) treaty came after Rwanda, Oman, Chad and Jordan signed up. This meant the magic number of 110 or two-thirds of the 164 WTO members states had been reached, which was needed to ratify the accord. TFA is expected to boost global trade by $1 trillion a year, adding to the $15 trillion now, while WTO economists estimate it will cut the cost of trading by 14.3 per cent, with developing nations set to gain the most. Economists also forecast TFA will reduce the time needed to import goods by over a day and
a half and to export goods by almost two days. The treaty was started in Bali in December 2013 and aims to make customs and border procedures easier to speed trade up and reduce trading costs, expediting the movement, release and clearance of goods crossing borders, including goods in transit. WTO director general Roberto Azevêdo, says the agreement represents a “landmark for trade reform” and the impact will be bigger than the elimination of all existing tariffs around the world. He notes: “But this is not the end of the road. The real work is just beginning. This is the biggest reform of global trade in a generation. It can make a big difference for growth and development around the world. “Now, working together, we have the respon-
sibility to implement the agreement to make those benefits a reality.” The International Air Transport Association’s (IATA) director general and chief executive officer, Alexandre de Juniac welcomed the news and says TFA will cut red tape at the border for faster, cheaper and easier trade. “That’s great news for airlines, which deliver about a third of the goods traded across borders by value. And it’s a particularly timely reminder of the dangers of the current protectionist rhetoric that we are seeing in various parts of the world. “Trade leads to growth; and growth results in prosperity. With the treaty now in force, we urge governments to move forward with early implementation so that the TFA’s substantial benefits can be realized,” he adds. The British International Freight Association’s director general, Robert Keen, welcomed the TFA as says it should help give a much needed boost to global economic growth and revitalise global trade. UPS chairman and chief executive, David Abney, says TFA will usher in a new customs framework, “making businesses more competitive and facilitating growth through exports”. (Above picture courtesy of the WTO)
Syria, along with the increased rhetoric about protectionist policies in some Western countries which also threatens the trend toward increased air service liberalisation. And ACI Europe says EU gateways grew by 4.1 per cent in 2016 with freight growth in December of 10.2 per cent boosting the figure particularly at non-European Union (EU) hubs. EU airports grew 4.4 per cent in 2016 and
non-EU hubs by 3.2 per cent. But ACI Europe director general, Oliver Jankovec warns fuel prices are likely to rise 30 per cent compared to the 2016 average and the outlook is unpredictable. He says: “Our trading environment is becoming more unpredictable and prone to disruptions, due to mounting geopolitical risks. These include the permanence of terrorism threats, increasing political instability both within and outside Europe and Brexit. “These risks reflect a set of emerging megatrends which are now challenging globalisation and free trade – and which could fundamentally alter airports’ long-term business prospect.” In 2016, Frankfurt Airport was top with two million tonnes, followed by Paris CDG Airport at 1.98 million tonnes. Amsterdam Airport Schiphol third, with 1.66 million tonnes, followed by Heathrow at 1.54 million tonnes.
Hubs volumes growth of 3.5% in 2016 driven by EU, ME and Asia THE Airports Council International (ACI) says air transport ended 2016 on a strong footing despite terrorist attacks, geopolitical tensions and economic uncertainty. ACI says airfreight markets experienced a revival in the second half of 2016 as volumes increased 3.5 per cent for the year with a jump of 8.9 per cent for the month of December brought on by an increase in volumes at airports in the Europe, Middle East and Asia-Pacific regions. ACI notes volumes each of these regions increased over 10 per cent for the month of December, despite long-term uncertainty regarding trade policies, heightened business confidence through inventory build-ups and increased export orders remained apparent in the near term. ACI says the growth came in 2016 despite economic uncertainty caused by Brexit, the US presidential election, and hostilities in
PHARMA, DGR AND E-COMMERCE UP FOR DEBATE SPECIAL PROJECTS DRIVING CHAPMAN FREEBORN DGR, GENERAL CARGO AND AEROSPACE RISING ULD MANAGEMENT CONTRACTS EYED BY UNILODE
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ECS joins forces with Exp-Air Cargo ECS Group and Exp-Air Cargo have joined forces to consolidate its position in the general sales and service agent market across the Americas region. Exp-Air Cargo was founded in 1990 with its headquarters in Montreal, and has offices in Toronto, Calgary, Vancouver and Edmonton, and predominantly focuses on the US and Canadian markets. Exp-Air Canada managing director, Danny Olynick says: “The hallmark of Exp-Air Cargo is its open and transparent partnership, where the final objective is to increase mutual revenues, by offering to our customers a great cargo experience with a reliable, fast and safe freight product.” ECS Group says the partnership will promote core competencies of total cargo management, customer loyalty and expertise in business intelligence and IT. Chief operating officer, Adrien Thominet says: “We share the same mind-set and have a common vision on how to tackle the challenges we are confronted with. “To achieve our objective of deployment, Danny Olynick, Exp-Air Cargo Managing Director, will take control of the commercial development of the USA for ECS Group and will lead the group under the new arrangement.”
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NEWSWEEK Perishables centre inaugurated in Bengaluru
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ir India SATS Airport Services (AISATS) has launched AISATS COOLPORT at Kempegowda International Airport in Bengaluru. The facility is India’s 1st integrated on-airport perishable cargo handling centre and covers 11,000 square metres and cost INR 48 crores ($7.8 million) to build. AISATS COOLPORT aims to meet the extensive handling requirements of perishable cargo products such as pharmaceuticals, fruits, vegetables, flowers, meat and seafood. The facility has the capability to handle 40,000 tonnes per annum and through end-to-end cold chain services including refrigerated trucking service, indigenously developed cool trolley and thermal blanket, as well as temperature controlled container handling. Trial operations took place from October 2016 through to January 2017, and saw a 27 per cent growth in perishable tonnage in comparison to the same period last year. During the trial, 4,653 tonnes (import and export) of varied temperature sensitive and perishable cargo was handled by the AISATS COOLPORT. AISATS COOLPORT recently obtained its Good Distribution Practices (GDP) certification for receiving, handling, storage and dispatch of pharmaceutical and perishable cargo as per World
Health Organization (WHO) standards. AISATS also aims to achieve HACCP and IATA CEIV certifications in the near future, which it says will promote better trade facilitation and enhance the state of Karnataka’s position as pharmaceutical and perishable hub of India. AISATS chief executive officer, Mike Chew says it is aiming to be the engine of economic growth for the region connecting Bengaluru to the world and be the ‘Gateway to South India’.
Exports drive growth in HK
HONG Kong International Airport (HKIA) cargo volumes grew by 3.1 per cent to 372,000 tonnes in January from 361,000 tonnes in the same month in 2016. The world’s busiest cargo hub put growth mainly down to a 7.5 per cent increase in exports. Amongst key trading regions, traffic to and from Europe and North America showed the most significant increases. In January, exports at HKIA made up 244,000 tonnes of the total and imports 128,000 tonnes, up 7.5 per cent and down 4.4 per cent, respectively. On a rolling 12-month basis cargo 3.4 per cent to 4.5 million tonnes with 1.643 million of imports and 2.89 million of exports.
Ataturk to remain open for cargo
ISTANBUL Ataturk Airport will serve for repairs and cargo after the opening of the €10.2 billion ($11 billion) Istanbul New Airport next year, according to reports in Turkey. The news comes as many are asking whether the gateway would be closed down once the third airport opens, but the State Airports Authority says major investments have been made in infrastructure at Ataturk so aviation services will continue, including for individual cargo operations. Istanbul New Airport operator IGA Airport Operation hopes to start operations at the new six runway hub in the first quarter of 2018. The cargo capacity will be 5.5 million tonnes.
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8 more CRJ conversions for Avmax
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eronautical Engineers (AEI) is to provide Avmax with at least eight more CRJ200 freighter conversions after signing a letter of intent. Avmax, which already owns 65 CRJ200s, intends to make the additional aircraft available for sale and/or wet/dry leasing options to operators around the world. The AEI CRJ200 will provide Avmax with eight 61.5” x 88” container positions and a payload of up to 6.7 tonnes. AEI senior vice president of sales and marketing, Robert Convey says the synergy of the two companies will “definitely be a benefit to all current and future CRJ200 SF operators”.
1st charter for Antonov from new base
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ntonov Airlines has carried out its first charter operation from its new UK headquarters at London Stansted Airport using machinery, which it designed to speed up loading of a giant helicopter. The cargo, a British-manufactured helicopter measuring almost 4.4 metres high, travelled from the UK to Southeast Asia on one of the airline’s seven AN-124-100 freighters. It was loaded at the Diamond Hangar at Stansted Airport: “It is a wonderful coincidence that one of the UK office’s first operations should take place on its doorstep,” says Antonov Airlines commercial manager, Paul Bingley. “Such close proximity allowed us, not only to successfully test our specially-de-
signed loading equipment, but also to work much more closely with our customer. You could say we arrived at the right place at the right time.” Antonov Airlines was the first to offer the 150-tonne payload AN-124 commercially more than 28 years ago. “Our team in Kiev was pleased to work closely with our UK office for this move,” adds Antonov Airlines head of commercial development, Andriy Blagovisniy. “Our in-house engineering expertise meant we were able to deliver an expert solution for this aerospace customer and we look forward to supporting many more companies in the defence, energy, humanitarian, industrial, automotive, and oil and gas sectors.”
UPS tests drone from van
UPS has tested a drone that launches from the top of a package car, which autonomously delivers a package to a home and returns to the vehicle while the delivery driver continues along the route to make a separate delivery. The integrator conducted the test last week in Florida with Workhorse Group, an Ohio-based battery-electric truck and drone developer. Workhorse built the drone and
Working with Air Charter Service, Antonov Airlines also delivered a new engine to a Boeing 777-300 grounded in Iqaluit, in the Canadian Arctic, following an emergency landing. (photo above credit: Caleb Little). The General Electric GE90, was delivered to the grounded Swiss International Air Lines aircraft, less than 48 hours after the jet landed in Canada. (See more on page nine).
NEWS WEEK WORLDNEWS LIEGE Airport has appointed Franz Heuckeroth van Hessen as vice president of air services and he will take on the role from 1 May this year. He will join from his current position as cargo director and sales at Cologne Bonn Airport, where he has been since 2008. Liege Airport chief executive offiicer, Luc Partoune praised Franz’s qualifications and expects him to be a “tremendous added value for the company”. LUG aircargo handling has created a new department of strategic product development to be headed by Wolfgang Voigt. And Axel van Hees has been promoted to manager of operations of its Frankfurt station, taking over from Voigt. LUG says it has realigned the management team to “strengthen competitiveness and responsiveness”.
the electric UPS package car used in the test. The drone used in Monday’s test was the Workhorse HorseFly UAV Delivery system. The drone docks on the roof of the delivery truck. A cage suspended beneath the drone, extends through a hatch into the truck. UPS senior vice president of global engineering and sustainability, Mark Wallace says: “This test is different than anything we’ve done with drones so far. It has implications for future deliveries, especially in rural locations where our package cars often have to travel miles to make a single delivery. “Imagine a triangular delivery route where the stops are miles apart by road. Sending a drone from a package car to make just one of those deliveries can reduce costly miles driven. This is a big step toward bolstering efficiency and reducing our emissions.”
Leaders of air cargo’s future
THE International Air Cargo Association (TIACA) has backed a new initiative encouraging new air cargo leaders of the future and collaboration in the supply chain. Staff from Air France KLM Martinair Cargo, Jan De Rijk Logistics, Tosoh Corporation, Valeant Pharmaceuticals
International, Agility, and Swissport visited each other’s sites to gain a better understanding of processes and explore new ways of collaborating. The initiative was launched by TIACA, with the help of Air Cargo Netherlands, as part of the association’s commitment to training and supporting the next generation of air cargo leaders. TIACA vice chairman and Jan de Rijk Logistics chief executive officer, Sebastiaan Scholte hopes it will be the start of many and somewhere young leaders of tomorrow can be developed.
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NEWSWEEK
New UK cargo manager and Phnom Penh route for Emirates
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mirates SkyCargo has appointed Ross Barnett as its new cargo manager in the UK. The carrier says International Air Transport Association (IATA) figures revealed in December that the cargo arm of Emirates – exported a larger volume of cargo from the UK than any other airline. Barnett will now be based in London, has over 30 years’ experience in the cargo industry. He joined Emirates in 1995, holding a number of positions in the company, most recently cargo manager for northern England and Scotland where he was responsible for over 20 staff based in the region. In his new role, he will oversee the 45 staff that Emirates SkyCargo employs in the UK, as his remit expands to encapsulate the whole of the UK, driving sales growth and ensuring oper-
ational excellence. Barnett will oversee the cargo operations for the 18 daily passenger flights that travel between the UK and Dubai each day, alongside the two additional freighter services from Heathrow Airport. In December 2016, IATA stats showed Emirates SkyCargo carried nearly 5,700 tonnes of
cargo from the UK, up 29 per cent on the same period last year. This was the first month Emirates SkyCargo exported a larger volume of cargo from the UK than any other airline. The total cargo volume flown by the UK arm of Emirates SkyCargo between January 2014 and December 2016 was nearly 190,000 tonnes.
Meanwhile. Emirates is to operate a new service to Phnom Penh in Cambodia from 1 July this year using a Boeing 777-300ER. The launch of daily services from Dubai to Phnom Penh will coincide with the introduction of a direct, non-stop route between Dubai and Hanoi in Vietnam. This adds to its freighter arm Emirates SkyCargo launching its 13th Far Eastern route with weekly Boeing MD-11 Freighter services to Phnom Penh on 6 April last year. Emirates says in terms of cargo, garments and clothing are expected to be popular exports from Phnom Penh on the new route. Cambodia is one of the emerging air cargo markets in Asia and last year new freighter routes were also added by the likes of AirBridgeCargo Airlines, and DHL, and belly routes such as by All Nippon Airways.
Air Logistics Group wins Finnair FINNAIR Cargo has chosen Air Logistics Group as its general sales and service agent for seven important European countries, effective from 1 April. Air Logistics Group will provide full cargo sales, marketing, customer service, administration and operational support across Belgium, Denmark, Germany, Ireland, the Netherlands, Sweden and the UK. Finnair says the deal is timely as it expands capacity and frequencies across Europe and Asia. Finnair Cargo head of global sales, Fredrik Wildtgrube says: “Air Logistics has
demonstrated capabilities that are essential to support Finnair’s growth. “Furthermore, Air Logistics’ network, local market awareness and presence will provide good service and strong support to our customers.” Air Logistics Group chief operating officer, Stephen Dawkins adds: “Finnair is at the forefront of the European aviation industry with its new COOL Nordic Cargo Hub terminal opening at Helsinki Airport this year, the expanding modern A350 fleet and an extensive network of over 100 destinations across Europe, Asia and North America.”
ATC wins Air Seychelles GSSA deal
2017 from Düsseldorf to Mahe and vice versa. Other destinations served by the airline from Mahe, Seychelles include Paris Charles de Gaulle, Johannesburg, Mumbai, Abu Dhabi, Mauritius, Durban, and Antananarivo. ATC Aviation Services is headquartered in Frankfurt, Germany with 35 offices in 15 countries and has a global portfolio of more than 70 airlines.
AIR Seychelles has appointed ATC Aviation Services as its general sales and service agent (GSSA) in Germany. The deal was announced at the Air Cargo Africa trade show in Johannesburg , South Africa which took place last week. Air Seychelles will start bi-weekly operations with Airbus A330 as from 31 of March
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NEWS WEEK
DHL and Huawei join up for ‘Internet of Things’ partnership
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eutsche Post DHL Group has signed a memorandum of understanding (MOU) with Huawei Technologies to develop a range of supply chain solutions for customers using industrial-grade ‘Internet of Things’ hardware and infrastructure. DHL believes the ‘Internet of Things’ could generate up to €1.77 trillion in extra value for the global logistics industry by 2025, enabling operators to better monitor and optimise supply chain processes with low-cost networked sensors and devices. Under the MOU, Huawei and Deutsche Post DHL Group will collaborate on innovation projects focusing on cellular-based ‘Internet of Things’ technology, which can connect large volumes of devices across long distances with minimal power consumption. DHL says greater connectivity can deliver a more integrated logistics value chain by providing critical data and visibility in warehousing operations, freight transportation, and last-mile delivery. DHL Supply Chain global COO and CIO, Markus Voss says: “Spending on connected logistics solutions is expected to more than double between now and 2020, and many logistics provid-
China Cargo changes owner
ers including Deutsche Post DHL Group have already begun to explore Internet of Things applications in their supply chains, including everything from enhanced asset tracking to driverless delivery vehicles.
“This MOU will allow both Huawei and Deutsche Post DHL Group to tackle complex operational and business challenges with a powerful combination of world-class Internet of Things hardware, networks, and expertise in end-to-end supply chain management.” Meanwhile, DHL is to start a new cargo route between Oslo Airport and Lakselv Airport Banak – bringing seafood exporters like Finnmark and Northern Norway closer to the Asian export markets. The route will be serviced by an Airbus A300 with a cargo capacity of around 40 tonnes. Depending on volumes and demand, the route will be serviced once to several times a week. Avinor director of cargo, Martin Langaas says: “This gives Lakselv and Finnmark a unique opportunity to reach key export markets for king crab and salmon in Asia. “The size of the aircraft enables DHL to get started quickly, without a need for investments with regards to airport infrastructure.” DHL Global Forwarding head of airfreight, Trond Ørjan Olsen says the new cargo route is established to connect with the large cargo crafts and scheduled flights flying from Oslo Airport to Asia and North America.
CHINA Eastern Airlines has sold its shareholding in loss-making freighter operator China Cargo Airlines. The carrier has agreed to a deal to sell its 100 per cent shareholding to Eastern Logistics, which owns 83 per cent of China Cargo Airlines. Eastern Logistics itself has been bought by Eastern Airlines Industry Investment Company, a wholly-owned subsidiary of China’s state-owned CEA Holdings, for RMB2.4 billion ($349 million). China Eastern explains that the sale will allow it to focus on the passenger segment and as is currently the case, China Cargo Airlines will continue to manage belly space and freight operations on China Eastern’s passenger flights.
Solid 2017 start for Cathay
CATHAY Pacific Airways has had a solid start to 2017 with cargo and mail up 2.3 per cent to 151,133 tonnes, with strong demand across key Asian markets. The combined growth for Cathay Pacific and Cathay Dragon in January is slower than the 9.9 per cent year-on-year surge seen in December but was described as “a solid start” by general manager cargo sales & marketing, Mark Sutch. He says: “Tonnage grew ahead of capacity and showed an increase over the same month last year. We saw a good rebound in demand from Hong Kong, Mainland China and various key Asian markets. Yield was sustained through a better mix of priority and special shipments.” “There was also robust demand for fresh produce and seafood across the network. We operated a number of extra-sector freighters to the Americas, Europe and India in January, while cutting back on capacity in February to adapt to Chinese New Year’s January start.” Cargo and mail revenue tonne kilometres grew one per cent to 862,953 tonnes, while capacity in available tonne kilometres was up 0.5 per cent, pushing load factors up 0.3 percentage points to 61.9 per cent.
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IATA WCS PREVIEW
Abu Dhabi the next port of call for IATA’s WCS
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he International Air Transport Association’s (IATA) World Cargo Symposium (WCS) takes place for the 12th time from 14-16 March in Abu Dhabi. This year’s WCS is themed ‘Transform Today: Shape Tomorrow’ and will take place at the Abu Dhabi National Exhibition Centre (ADNEC) and will welcome delegates from key stakeholders across the air cargo supply chain. The opening plenary will kick-off WCS on Tuesday, 14 March with a welcome address by Etihad Airways’ president and chief executive officer (CEO), James
Hogan. IATA’s director general and CEO, Alexandre de Juniac (left) will then give a state of the industry talk where he will give an overview of how air cargo is performing and any challenges it faces. WCS chairman, IATA’s head of cargo, Glyn Hughes will follow, giving his opening remarks and will be joined by IATA’s deputy general counsel, Carlos Tornero for a discussion. After a networking break an economic outlook entitled – will the positive growth continue? - will be given by IATA’s senior economist, George Anjaparidze. He will give an update on the prevailing economic climate and its implications for the airfreight industry also looking back over the past 12 months and what we may expect for the upcoming 12 months. Hughes will then review the year for air cargo giving an industry scorecard and review success
and challenges during the past 12 months. He will also cover industry priorities for the coming year and give the results of the Shipper Survey 2017, which gains an insight into air cargo performance from the eyes of the shipper. Next up will be a one-to-one interview with Eithad Cargo’s vice president, David Kerr who will explore the carrier’s path to success and what lies ahead. After a networking lunch an issue many in the industry are passionate about will be discussed as wildlife trafficking is the focus. Etihad Airways’ environmental manager, Linden Coppell will ask – what can we do to stop it? The $19 billion industry is one of the top five illegal trades in the globe and is threatening some of the planets most endangered species. Smugglers use many transport modes to move these goods. This presentation will highlight how the aviation industry is fighting to block the
movement by air. WEF global executive and director, Wolfgang Lehmacher will then talk about China’s New Silk Road - with the presentation detailing the challenges, risks and opportunities that lie ahead. A discussion how the evolution of the world’s freighter fleet will follow, looking at how the market has changed over the last decade – and ask what is to come? This will be followed by a debate called ‘Watching the horizon’ focusing on what is in store for the future and likely challenges to the industry on the horizon. The final plenary session is ‘Transform today’ where a panel will discuss the various issues impacting the air cargo industry today and how they will shape the industry going forward. An exhibition will also feature the likes of Etihad Cargo, Descartes, Swissport, Turkish Cargo, ACL Airshop, Jettainer and Boeing.
Innovation awards back for 2nd edition
THE IATA Air Cargo Innovation Awards will be returning for its second edition, and the association has announced the finalists for this year. The International Air Transport Association (IATA) will announce the winners during the closing plenary of the 11th IATA World Cargo Symposium in Abu Dhabi on 16 March, and the winner will receive $20,000. The finalists are UTM Concept for Africa by Astral Aerial Solutions, Smart Electric Cool Dolly by Etihad Cargo, Redefining
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trade with block chain by Gate Chain, Innovative Decision Support System by Jettainer, and SkyBreathe Fuel Efficiency by OpenAirlines. IATA received 46 entries and seven members of an independent jury who will evaluate the ideas. IATA hosted the first edition of the Air Cargo Innovation Awards during the 2015 WCS in Shanghai, which was won by CHEP Aerospace Solutions’ CanTrack energy harvesting tracking solution for unit load devices (pictured above).
IATA WCS PREVIEW
Pharma, security, DGR, and e-commerce up for debate
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ey air cargo issues and sectors will be discussed on day two of the International Air Transport Association’s (IATA) World Cargo Symposium (WCS) on 15 March. Tracks will be running simultaneously throughout the day giving delegates the opportunity to gain knowledge, insight and hear latest developments in particular areas. In the morning, tracks will be on dangerous goods (DGR), digital transformation, cargo operations/ handling and cargo security. DGR will see a presentation on risk assessments, and also delve into how safety management systems support these, while the track will also include look at lithium batteries and explore risk mitigation strategies. The digital transformation track will focus on how digital developments are impacting the air cargo industry.
The future of air cargo
Presentations will include by McKinsey & Company associate principal, Emma Loxton on how digital innovations transformed or disrupted other industries and on big data and artificial intelligence by Jettainer’s head of marketing, Martin Kraemer. Also running is a track on cargo operations and handling where Heathrow Airport’s head of cargo, Nick Platts and Amsterdam Airport Schiphol’s head of cargo, Jonas van Stekelenburg (pictured) will join forces to discuss how they position themselves as logistics hubs, bring partners together and drive improvements for mutual benefits, detailing the cargo village concept. The fourth track running will focus on cargo security and any global trends and policy development and in one session panelists will ask is a global culture of security still possible? There will also be a debate by panelists on air cargo security screening innovation, looking at where it is heading. A further four tracks will also be run simultaneously in the afternoon with sessions on pharmaceuticals, smart ULDs, e-commerce logistics and cargo border management. Pharma will look at addressing the pharma and radio-pharma supply chain complexity and be chaired by DHL Global For-
warding’s global head of network and quality, Nina Heinz. Among sessions will be one on pharma transportation and meeting shippers’ expectation of qualified trade lanes. Johnson & Johnson’s senior manger for EMEA temperature control, Gino Vleugels will be among the contributors. The smart ULD track will see a series of presentations on safety requirements for ULD operations, ask whether robots can do the job better, look at application of robotics technology in ULD operations and discuss whether the growth in e-commerce can drive the use of collapsible ULDs. The e-commerce logistics track will detail the evolution of online retail sales since IATA WCS 2016 and take a look at new aspect of e-commerce that need to be taken into account. There will also be a session on e-commerce from the stakeholder’s perspective looking at what is being done by airlines to help fulfill and comply with e-commerce requirements. Also running is a track on cargo border management where discussions will revolve around protectionism, illegal wildlife trade and a panel debate on the WTO Trade Facilitation Agreement.
THE final day of the International Air Transport Association’s (IATA) World Cargo Symposium (WCS) on 16 March in Abu Dhabi will see tracks focusing on the future of air cargo and what the industry may well look like in the future. Track one of the day will look at the cargo facilities of the future and what they will need to be like and do, exploring the needs of a cargo facility in future decades, while also looking at the impact e-commerce is having on new builds. IATA’s head of cargo operations, Brendan Sullivan will set the scene and bear this in mind in considerations of today’s air cargo environment while also taking a look at trends for the future. Panelists will discuss the different elements that must be considered when looking at developing or refitting a facility asking what is the cargo facility of the future? Other debates will looks at whether robots can really be useful in the air cargo environment, is wearable technology a viable choice for an air cargo facility and another will focus on process improvements – looking at how we can use data to make better business decisions. Also running at the same time will be a track on fighting back to profitability discussing improving and sustaining financial health. McKinsey & Company director for Emeritus, Carl-Stefan Neumann will speak about the challenges to air cargo industry’s profitability. A panel session will also take place asking what is the model for the future of air cargo? IATA’s senior economist, George Anjaparidze (pictured above) will moderate and members of the panel will look at what is the recipe to sustain the air cargo industry’s financial health. Also taking place is a track on special cargo and perishable products, focusing on how the sector can be successful in the future. Among sessions will be a view on an airline’s view on perishables logistics solutions by Qatar Airways senior manager for cargo products, David Beecham. A panel discussion on enhancing industry-wide minimum standards for the transport of perishables will also take place, looking at how a collaborative approach requires all stakeholder groups to engage actively. The 12th and final track on live animals management will also take place looking at how to safeguard animal safety and welfare. Panelists will debate operational challenges when transporting live animals, and include United Airlines Cargo product development and marketing manager, Sue Kazlaw-Nelson, and ACL Airshop director of EMEA, Maurice van Terheijden. IATA’s head of cargo, Glyn Hughes will then wrap WCS up in the closing plenary, giving an overview of discussions had.
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AIR CHARTER
Special projects driving Chapman
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hapman Freeborn has had another strong year, particularly for project based work, according to group cargo and OBC sales director, Reto Hunziker (pictured below right). He says the results over the past 12 months were good despite the lack of extraordinary events such as the West Coast port strikes of 2015. Hunziker comments: “It’s always difficult to accurately predict charter demand - but we’re very pleased with how the year has started and plan to build on that momentum.” He says overcapacity is an issue but adds: “At the same time it can sometimes provide opportunities to try new things.” Hunziker tells Air Cargo Week the growing flexibility of operators means Chapman Freeborn can fill gaps not served by scheduled services. He says: “A good example of this is the B747-400F we currently have running between Europe and US for Senator International – with Chapman Freeborn managing the spare ad hoc charter capacity between rotations.” The charter business is always varied, with Chapman Free-
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born’s animal transportation business, Intradco Global handling some interesting shipments. Hunziker says: “One of the projects so far this year was the biggest single movement of Irish horses to China ever. On behalf of a client 76 thoroughbreds were flown on a chartered B747400F from Shannon to Beijing.” He explains: “The Asian market – and China in particular – is a rapidly growing business for equine shipments, so it’s great to be at the front end of that.” Chapman Freeborn has also been targeting the Indian on board courier (OBC) market, and Hunziker says progress has been positive so far. “OBC is very much a global business and India is just one of the markets we see as having great potential.” When the company announced it was targeting the Indian OBC market in June, it said surging economic growth of 7.6 per cent and the government’s Make in India initiative was increasing demand for hand-carry services for automotive cargo, electrical components and other time-critical shipments. He adds: “It’s not yet taken off to the extent as some other emerging markets in terms of demand levels (for example, the high demand we see from China and Mexico for automotive related business) – but India is getting stronger all the time.” Africa is also an area of interest over the next 12 months though Hunziker says: “We’re also keen to continue building our market share in other regions such as China and India.”
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Helping LNG flow
VOLGA-DNEPR Airlines has run charter flights and used scheduled freighter services through AirBridgeCargo (ABC) Airlines to transport equipment for the set-up of a new liquefied natural gas (LNG) production plant. The company operated a series of An-124-100 (above) and IL-76TD-90VD (below) charter flights and utilised ABC Boeing 747 Freighter services for deugro Airfreight – who was setting up the plant in the Yamal Peninsula in northwest Siberia. In 2016, airfreight part started with two IL-76TD-90VD flights from Frankfurt-Hahn Airport to Sabetta, Russia. The first flight carried 46 pieces weighing 29 tonnes, followed three weeks later by a second transport with another 31 pieces totaling 17 tonnes. In November, more equipment destined for the LNG plant was carried on ABC’s scheduled 747 freighter services from Singapore to Frankfurt and from Shanghai Pudong Airport to Amsterdam, from where the shipments then continued their journey by sea. The most recent flights included an IL-76TD-90VD out of Liege and an An-124-100 out of Dalian, China, both at the end of January 2017, to deliver more vital equipment destined for the LNG plant in Sabetta, Russia. Volga-Dnepr Group vice president of strategic management and charter cargo operations, Tatyana Arslanova says: “With the winter season affecting ocean freight operations due to the build-up of ice, the time-critical shipments carried by Volga-Dnepr and AirBridgeCargo are enabling construction of the LNG plant to progress before severe winter weather slows down the project. The sensitivity and high value of the equipment were other factors in the decision to fly the cargo with us. “Once again, we have been able to show a major customer the benefits we can offer through our Cargo Supermarket concept, which, given the global nature and complexities of this project, not only provides important cost efficiencies but also a high level of flexibility.” deugro was awarded part of the logistics program for the Yamal project and has shipped over 700,000 tonnes of cargo to module yards in China and the project site in Russia. More flights are planned for 2017 using the Volga-Dnepr Group fleet.
AIR CHARTER
DGR, general cargo and aerospace on the rise
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017 has started well for Air Partner and director of freight, Mike Hill (pictured right) expects it to be a better 12 months than 2016 which was challenging. He says 2015 was “extraordinarily good” and difficult to repeat such feats, with the market dropping slightly across the entire freight sector in 2016 - but dangerous goods, general cargo and aerospace rose, as did client numbers. Hill says the UK has been performing well in 2017 but points out it is hard to foresee much in the charter business. He says: “We have already received a number of forward bookings which we do not usually experience so early on in the year. We are expecting 2017 to be a better year than last, with continued demand from the automotive and aerospace sectors in particular.” Automotive has been a significant part of business over the past five years, though Hill comments: “It is an extremely fast moving business where commercial boundaries are often blurred, in that some forwarding companies work directly with airlines and
some broker companies work directly with shippers.” He says some brokers have even set up their own forwarding companies to work with shippers, and he says it can all get a bit messy, and Air Partner will not be going down that line. Hill says: “Due to our longterm relationship with the forwarding and logistics community, we remain true to the traditional broker company model and keep it straight and simple in that we only work with the forwarders and not the shippers.” Air Partner deals with a lot of humanitarian cargo, flying to
Core business and bookings growth for ACS
2016 did not have exceptional events like 2015, but Air Charter Service (ACS) group cargo director, Dan Morgan-Evans says core business continues to grow and there are more advanced bookings to look forward to. He says figures at the start of 2015 were affected by the US West coast seaport congestion, giving the Far East and Americas offices a major boost, and there was not anything comparable this year but some offices are performing very well. Morgan-Evans comments: “It’s always difficult to cover those big exceptional events unless you have exceptional events the next year but the core underlying business was up when you take out those special events.” He says the Hong Kong office continues to flourish, and “its really got some traction with movements out of the Far East going into Europe, going to India, some flights to South America as well.” ACS opened an office in Sydney last January, and Morgan-Evans says it had an “exceptional year” and the pressure is on for this year. Europe also did well, with the
challenging and potentially dangerous destinations, such as in the aftermath of Hurricane Matthew in Haiti. Hill says: “Our team has extensive experience and expertise in arranging flights at short notice, which is why so many clients return to us time and time again.” Air Partner gets its fair share of interesting requests, with the French office chartering an Antonov AN26 to transport two tonnes of furniture to a new casino in Antibes in time for opening when trucking was not an option as would have taken four days. Looking into the future, Hill predicts the ending of the Ruslan joint venture, which has now split into the Volga-Dnepr Group and Antonov Airlines means more variety of project cargo in regards to AN-124 operators making it more competitive again. He says the market is constantly changing, with new players entering the marketplace all the time, and adds: “This makes it an exciting business to be in. With our innovative technology and experience in a variety of sectors, if one sector falls, we can still make gains in others.”
London office growing 15 per cent driven by the automotive market. ACS started its on-board courier service in 2015, and it doubled the amount of shipments and is an area Morgan-Evans says tags onto its existing business. He says: “We already have the customers and we can offer them this new service. It is amazing how they were doing this and not really asking us to have this service before but now with our hub in Frankfurt it has given us another string to our bow.” The company’s financial year starts on 1 February, so it is hard to say how it is going as it has only just started, but Morgan-Evans says ACS is where it was at last year. He says: “In the business we are in you don’t often see so many forward bookings. It’s nice to have some booking on board straight away.” Most charters are ad-hoc, ACS were called upon to assist with an AOG in Canada, nothing unusual in itself except that it was in Iqaluit in the far North of Canada, after a Swiss International Airlines Boeing 777-300ER suffered engine problems. He says it was a logistical challenge getting an Antonov over there, with an aircraft engine coming from Zurich. Morgan-Evans says the cold weather gave the engineers a challenge, but it got changed and the broken engine was flown back to East Midlands Airport. Oil and gas is picking up, and there have been more enquiries for project work. Morgan-Evans says: “I can definitely feel it is picking up, project work with take a lot longer, I don’t think we will see that change over the next 12-18 months but the ad-hocs are starting to roll round again.”
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ULDs ACL Airshop targets more stations, contracts and growth
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ast year was a significant 12 months for ACL Airshop as it significantly grew its global presence. The US-based firm added six new unit load device (ULD) stations at Tokyo Narita, Hong Kong, Los Angeles, Bogota, Mexico City and Sao Paulo, and is now located at 37 locations on six continents. ACL also won an additional four ULD airline management contracts and added ULD tracking to its portfolio of services. President and chief executive officer, Anthony Morgan says 2016 was a “phenomenal” year with 60 per cent growth of ULD leasing. “We surpassed what we were aiming for and blew away our goals and for 2017 we have set similar lofty goals,” he adds. One of the biggest achievements in 2016 Morgan feels was in helping the US-based world’s biggest online retailer launch its own air service as it seeks to grow its e-commerce service and ACL worked throughout the set-up process. The second one of note was setting up a service repair and maintenance station at Tokyo’s Narita International Airport, which he explains the company is proud of achieving as it came with its challenges. Morgan says: “There are barriers to entry in
Japan in setting up your own facility especially at Narita where 60 per cent of Japan’s air cargo goes through, but it has been a success and is running very well.” Another major achievement was that ACL manufactured 1.3 million high quality cargo straps, used across the industry. Morgan feels the partnership it has with Ranger Aerospace gives the business the “rocket fuel” needed to grow and Ranger’s plan is to enhance and expand ACL through strategic investments and organic growth and global expansion. In 2017, he says ACL is aiming to add 11 more stations giving it 45-50 global locations, have full service repair stations in Hong
Kong and Bogota and also add five new ULD tracking customers. The company wants to be located in the majority of the world’s top 100 air cargo hubs within 72 months or faster, as it says it is what its customers want. Morgan notes it also wants to grow its leasing business and expand it by 42 per cent, which would mean 100 per cent growth in two years. He adds: “We are firmly confident that we will achieve that or exceed it.”
The full array
The reason Morgan is so sure is as not a lot of companies do what ACL does in covering everything ULD related from manufacturing, to selling, repairing, managing and leasing. He says: “There are a couple that do a bit of some, but we do the full array so when an airline is looking for one solution service provider 24/7 365 days a year, then that is what we do - so when the airline looks we are the only one. “Our growth is global and we go to the areas where the cargo is moving and where there is shortages of ULDs. Our growth is dictated by the airlines and our customers’ networks.” And Morgan says the future of ULDs is firmly lightweight to save airline’s weight and cost: “Everything is going lightweight and in the future there will also be collapsible ULDs, which will come in and e-commerce is driving this. There are opportunities in this in the future.”
Demand for outsourcing strong JETTAINER’S marketing manager Martin Kraemer (left) says outsourcing of unit load device (ULD)management by airlines is still “strong” due to being one of the last easy ways to save costs. He notes some major carriers are in the process of evaluating ULD management outsourcing scenarios. “As there is no highly sophisticated software solution on the market, many airlines do ULD management by using very basic tools, or not at all, which is inneffective,” Kramer says. He says Jettainer develops the IT platform in-house, and latest developments have seen improvements on the customer-end such as an easy to use, intuitive approach. Kramer explains Jettainer has further developed the decision support system DSS and it is using artificial intelligence to support ULD controllers to use their time and effort more efficiently. He adds: “Based on the steering system, we are able to reduce assets. Aside from reducing capital cost, we are able to reduce empty positioning movements, which do increase revenue potentials for our clients. “The reduction of unnecessary empty movements reduces the fuel burn of the transporting aircraft and is hence creating further benefits for clients and the environment.” Jettainer sees more ULD hardware innovations to equip ULDs with various devices to track, trace, and get data, but Kraemer says the challenge is to make them ‘suitable business cases’. “Technically, a lot is possible, but often it does not transfer into business cases the airline is willing to pay for. In other words, it does not make sense to equip a ULD with technology worth more than the price of the actual ULD,” he adds. Kramer says a key question for an airline is ‘Does a seamless tracebility of ULD create any value for the airlines customers? He feels if yes, then widespread implementation is useful, but if not, the added value of real-time data becomes questionable. Another burning challenge is cool ULD steering as more carriers are asking to include their cool ULDs in management packages, which Kraemer says is a huge challenge, as cool ULDs are steered and run in a completely different way from standard ULDs, adding. “We have taken over active cool ULD steering for some of our customers.” Another focus area, Kraemer notes is reducing damages, as it directly impacts flight safety. “Mishandling of ULDs in airports has to come down to ensure a smooth, efficient and safe airline operation.”
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ACW 27 FEBRUARY 2017
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NEWSWEEK ULD management contracts in ME and Asia eyed by Unilode
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nilode Aviation Services is targeting winning ULD management business from carriers in the Middle East and Asian markets in 2017. President and chief executive officer, Dr. Ludwig Bertsch says both regions have lots of potential with airlines operating large fleets of widebody aircraft and there is an impressive growth rate predicted for the next few years. “We are in an advanced stage of negotiations with a number of Middle Eastern carriers and hope to announce significant business wins shortly,” he adds. Earlier this month, Unilode was rebranded from CHEP after EQT Infrastructure bought the company in November 2016 from Australian logistics firm Brambles in a $130 million Australian dollar deal. Bertsch says the rebranding signals a “new beginning” with positive spirit and eagerness to prove its value as a standalone company,
while all management and staff have remained and everyone is excited about the future under EQT’s ownership. He adds: “Our new name Unilode was announced just a few weeks ago and the rebranding of our business is in progress. Given the large number of containers in our ULD pool the change of logo on the units may take up to two years but otherwise the rebranding will be carried out quite quickly. “We will exhibit under our new brand at WCS in Abu Dhabi and air cargo europe in Munich, and launch our new website in March. “We have received very positive feedback on our new brand from our partners and look forward on building the Unilode brand with values, which are meaningful to our people and both our current and future customers.” As for how 2016 went, he says it consolidated its position in the market and it provides ULD management for 40 airlines and servicing the ULD and galley cart fleet of around 50 customers. Bertsch says: “This is an amazing growth over the last few years and proves the increasing popularity of outsourced ULD management. We have also hit the mark of 100,000 units in our ULD fleet, which is the largest independent ULD fleet in the industry.” Notable wins were a ULD management contract with LATAM
Airlines, which has added 13,000 ULDs to its fleet and increased the number of airports in its network to 450. Operations started in September and he says it is running smoothly. Unilode also entered into ULD management partnership with regional and leisure carriers, extended its ULD management agreement with Cargolux, SAS Scandinavian Airlines and Air Europa, and secured a long-term ULD repair contract with Singapore Airlines. Bertsch says in 2017 it will aim to partner with even more airlines and notes EQT will provide it with the financial support and expertise to accelerate the business to meet their expectations in terms of profitability and revenue growth. But he explains ULD repair costs are still too high, but awareness campaigns on the correct way to handle ULDs is helping and it now applies a ‘handle with care’ sticker on containers to advise ground handlers ULDs are considered part of the aircraft and incorrect handling may put the crew and passengers at risk. “As the industry continues to raise awareness we expect to see some improvement this year. But frankly as long as the ground handling industry is not willing to accept responsibility for the proper handling of ULDs and does not suffer financial consequences for causing unnecessary damage this will remain an uphill battle,” Bertsch adds. Bertsch says it will make investments in replacing older containers with new lightweight units, and in innovative IT solutions with improvements planned in its CanTrack systems for ULD management and in ACTIS software for the repair business. “This year we will open new repair stations and modernise several facilities and look forward to serving even more customers in 2017 and beyond,” he adds.
New offices for C.H. Robinson
C.H. ROBINSON has opened new offices in Asia and Canada and more after acquiring APC Logistics, which has wide freight forwarding and customs brokerage services in the Oceania region. The US freight forwarder says the move has ensured shippers’ “needs are met and exceeded” by expanding its global footprint in key strategic global markets, and led to creation of 15 new C.H. Robinson Global Forwarding offices. New office locations include Hanoi, Vietnam; Chengdu, China; Nanning, China; Ludhiana, India; Indore, India; Vizag, India; and Vancouver, Canada. With the acquisition of APC, C.H. Robinson has added nine new offices in Australia and New Zealand. The company says recent growth of its Global Forwarding division is a testament to how it is continuing to invest in customers around the world and by expanding into strategic regions to be best equipped to help shippers navigate global supply chains. C.H. Robinson Global Forwarding president, Mike Short says: “As our customers are going global with their supply chains, we feel that it is crucial to have boots on the ground in those locations as well. It is exciting to see our services and talent pool expanding in these strategic regions. “I am energised by the growth of our Global Forwarding division. I look forward to our continued focus on global expansion, which will allow us to create an unbeatable customer service experience around the world.”
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