ACW 31st October 16

The weekly newspaper for air cargo professionals Volume: 19

Issue: 43 31 October 2016

Fresh collaboration calls at ACF by industry and regulators

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he International Air Cargo Association’s (TIACA) Air Cargo Forum in Paris saw fresh calls by industry, regulators and all parts of the supply chain to collaborate even more to meet the changing needs of air cargo.

During ACF, TIACA and the International Civil Aviation Organization (ICAO) outlined their continued plans to work together on a series of initiatives aimed at improving the industry.

This includes the development of a new technology platform to support Pre-Loading Advance Cargo Information (PLACI) systems, as well as a new Cargo Service Quality Index for measuring cargo performance at the airport level.

This collaborative effort further builds on previous agreements between ICAO and TIACA signed at the association’s two previous

ACFs in Seoul and Atlanta.

Other key areas of commitment were to work to meet the challenges that e-commerce brings, and move even faster with e-freight to create a paperless environment for air cargo.

All parts of the chain also committed to working closer with shippers’ to better their needs and demands in a changing business landscape.

ACF in Paris was a major success according to TIACA’s executive director Warren Jones, who says more than 2,300 delegates flocked through the gates at the Paris Expo in Porte de Versialles in the first two days to network, attend the conference sessions, speak to exhibitors and do business.

Jones says the new CargolinX one-to-one meetings were busy with more than 450 held over the

share data and expertise and offer innovations.

Brussels Airport’s director of cargo, Steven Polmans says it was not just an idea dreamt up over some Belgian beer but out of a genuine interest to help the industry.

He adds shippers were asked what were their priorities, expectations and needs who say there needs to be more consistency and focus.

Pharma.aero was first launched in Miami in May, with Brussels and Miami the founding members.

Coyne Airways and Air Charter Service (ACS) announced at TIACA’s Air Cargo Forum in Paris last week they are backing War Child - a charity helping children affected by conflict in the Middle East, Africa and Asia.

Coyne and ACS will donate an agreed amount per transaction on behalf of their customers, starting from next month. Customers will be given the opportunity to match the donation on a quarterly basis.

Coyne chief executive officer (CEO), Larry Coyne says: “We want to support a charity which helps some of the most disadvantaged people during wars – children, and encourage participants in our industry to give, based on a formula which is simple and within their means.”

ACS chairman, Chris Leach says ACS already supports other charities, but when War Child came to his attention he felt it should dig a “little bit deeper”, adding: “During our careers in this industry some of us have seen the horrors left behind by conflict first hand. With Syria at the forefront of people’s minds at the moment, we feel we can do more to help.

“There are some great people in this industry of ours and if more of us came together we could make a really significant impact.”

Pharma.aero officially launched The pharma.aero organisation has been officially launched to strengthen pharma certified lanes and extend cold chain supply chains to reach new markets.

Brussels Airport and Miami International Airport were joined by representatives from Changi Airport, Singapore Airlines Cargo, Brussels Airlines and Sharjah International Airport to formally launch the programme at TIACA’s Air Cargo Forum last week. Brinks Life Sciences is also joining.

Pharma.aero chairman, Nathan de Valck, who is also cargo & product development manager sales & marketing for Brussels Airport, explained to delegates the vision is to strengthen collaboration, develop pharma tradelanes,

first two days between freight forwarders, airlines, shippers and all parts of the air cargo supply chain.

He says CargolinX will be firm fixture in future TIACA ACF events as the feedback has been nothing but positive with airfreight businesses commenting to him how happy they are to have had the opportunity.

Jones notes TIACA’s previous ACF events have sometimes been challenging, but bringing the Global Shippers’ Forum and European Shippers’ Council into the fray boosted this year’s event.

Jones is confident the biennial ACF will only get bigger and the 29th ACF in Toronto from 17-19 October 2018 will see TIACA co-locate with Multimodal Americas.

He says it will make ACF “even better” and help meet the demands of attendees who want to see more multi-modal aspects incorporated into ACF. See pages six and seven for more on ACF.

Coyne and ACS to help War Child

HACTL IMPROVING PROCESSES PLEDGE TO SECURE FUTURE OF AIR CARGO ACS AIMING FOR FURTHER GROWTH STRONG DEMAND FOR BOEING 747 CHARTERS

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Schiphol strives for more efficiency SCHIPHOL Cargo is backing further projects as part of the Smart Cargo Mainport Program to find innovation to improve flows through Amsterdam Airport Schiphol, underpinned by transparent data exchange.

The Smart Program projects centre on cargo flows, encouraging cooperation between the different parties in the supply chain, as well as data sharing.

The Program steering committee is headed up by Schiphol Cargo, KLM Cargo, Dutch Customs and Cargonaut, has attracted €375,000 of Dutch government backing, and participation from leading firms in the airport community and the University of Delft and Hogeschool van Amsterdam. A pilot scheme is underway, bringing together all sectors of the supply chain to work collaboratively towards improved services through the hub.

Schiphol head of cargo, Jonas van Stekelenburg says: “This is a tangible innovation push for members of the Schiphol cargo community, aimed at realising efficiencies, reducing costs, and enhancing services. The community is putting in the effort, with companies willing to take risks and spend resources, and we are seeing results.”

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NEWSWEEK Heathrow given backing for third runway HEATHROW Airport has received approval for expansion by a committee of UK government ministers, with parliamentary approval expected by the end of next year.

Members of parliament are unlikely to vote on the decision until the winter of 2017-18 and then there are likely to be legal and political challenges.

The Government appointed Airports Commission chaired by Sir Howard Davies released its report in July 2015, recommending Heathrow receives approval for a third runway, with options to either extend an existing one or a new runway at Gatwick Airport.

The Government says a new runway at Heathrow will bring economic benefits and its expansion will create even more opportunities for UK business to get their goods to new markets.

Government transport secretary, Chris Grayling says: “The step that government is taking today is truly momentous. I am proud that after years of discussion and delay this government is taking decisive action to secure the UK’s place in the global aviation market – securing jobs and business opportunities for the next decade and beyond.

“A new runway at Heathrow will improve connectivity in the UK itself and crucially boost our connections with the rest of the world, supporting exports, trade and job opportunities.”

Heathrow handles about 1.5 million tonnes of cargo a year and chief executive, John Holland-Kaye, says: “A new runway will open trade routes and create jobs up and down the UK. Heathrow will play a key role in making our country stronger and fairer for everyone.”

The decision has been welcomed by members of the Freight Transport Association and British International Freight Association.

Air cargo up 4.2%

AAPA: airfreight sees strong uplift in September

irfreight volumes grew faster than passenger numbers for the first time in 18 months in August 2016 at 4.2 per cent says the Airports Council International (ACI).

All regions saw growth in August, with strong uplift coming from North America at 6.7 per cent, followed by Asia Pacific at 4.5 per cent and Europe at 4.4 per cent.

Volumes were weaker on a year-to-date (YTD), with 1.2 per cent growth. A number of regions declined. Africa saw a slump of 1.8 per cent, followed by North America, down 0.6 per cent. Latin America-Caribbean fell 0.1 per cent. The Middle East saw growth of 4.2 per cent, and Europe 2.2 per cent.

ASIA Pacific carriers have seen improvements in September with freight tonne kilometres (FTK) rising 5.3 per cent, the Association of Asia Pacific Airlines (AAPA) says.

The association says air cargo has improved despite weak trading conditions, with FTKs rising to 5.6 billion. Capacity in available FTK (AFTK) also rose by 4.4 per cent to 8.8 billion, with load factors rising 0.5 percentage points to 63 per cent.

AAPA director general, Andrew Herdman says: “Air cargo volumes aggregated for the first nine months of the year match those of the same period last year, reflecting the modest upswing in demand in recent months, bolstered by higher shipments of electronics designated for product launches.”

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After a weak start to the year, cargo is picking up again with FTKs at 48 billion, the same as the first nine months of 2015.

Capacity in AFTK has grown by 3.3 per cent pushing load factors down two percentage points to 61.2 per cent.

Herdman says: “The lack of impetus for a revival in global trade activity may present some headwinds to sustained growth in air cargo markets.”

NEWS WEEK The airside ‘missing link’ pharma dolly launched by Brussels Airport

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russels Airport launched its Airside Pharma Transporter at The International Air Cargo Association’s (TIACA) Air Cargo Forum, which has been developed to solve issues airside in the movement of pharmaceutical cargo.

The gateway and its cargo community collaborated to develop the dolly, including DHL, Expeditors, Panalpina, K+N, Brussels Airlines Cargo, Jan de Rijk Logistics, Expeditors and others, while pharma shippers were also part of the development.

Brussels has acquired four dollies that can be rented by operators at the airport through a booking system. The concept is owned by SPS. The airport envisages a need to acquire more dollies due to the interest shown.

The transporter is a trailer on which a refrigerated unit with insulated walls is mounted and a major innovation is that the technology allows the temperature and location of the refrigerated transporter to be monitored in real-time.

The dolly operates with solar panels so the refrigerated unit can adopt or retain the required temperature at any time. It can be used for 36 hours in the summer and 24 hours in the winter.

The transporter is for lower deck usage and the temperature of

the dolly can be set for between +5 to +25 degrees Celsius.

Brussels Airport first introduced the Airside Pharma Transporter last year for the pharma sector in Belgium, but it has been renewed and the innovations have been made to meet challenging requirements, especially for areas of extreme weather. The transporter is not only energy neutral, but also more efficient and

a larger number of transports per day is possible.

Speaking at the launch in Paris, Brussels Airlines Cargo vice president of global cargo, Alban Francois says the transporter is the “missing link” in the supply chain and it he hopes the carrier can use the dolly not only in Brussels but also across the globe to meet needs and demands.

His views over the dolly being the “missing link” were echoed by chiefs from freight forwarder Expeditors who say they can now extend their relationships on pharma cargo from Brussels Airport, such as to the US with American Airlines Cargo.

Brussels Airport Company chief executive officer, Arnaud Feist says: “The pharmaceutical branch is one of the most important sectors in our country and has a large added value for our economy. It is therefore essential that we offer the required customised service when they export their products.

“We innovated earlier with IATA by developing the CEIV guarantee certificate for the cold chain; our airport was also the first to achieve this worldwide standard.

“With the new ‘Airside Pharma Transporter’ we have developed an efficient product that, thanks to the solar panels, is also extremely environmentally friendly.”

GSF and Cargo sign quality MoU

THE Global Shippers’ Forum (GSF) and Cargo iQ have signed a memorandum of understanding (MoU) to implement the latter’s Quality Management System (QMS) and promote sustainability in the air cargo supply chain.

The MoU was penned at The International Air Cargo Association’s (TIACA) Air Cargo Forum in Paris last week, and designed to promote Cargo iQ standards, share information and best practices, identify and promote ways performance data can be better accessible for customers, and share details of forthcoming events where progress can be reviewed.

GSF secretary general, Chris Welsh MBE says it will make sure industry performance standards meet shippers’ needs.

Cargo iQ executive director, Ariaen Zimmerman adds only when shippers participate in avoiding costs and value its products, can industry offer the services needed in an economically sustainable way.

Demand high for Panalpina in Q3 PANALPINA saw good growth in the third quarter (Q3) as it posted an airfreight volumes surge of 10 per cent on the same quarter last year handling 228 million tonnes.

For the first nine months of 2016, demand is nine per cent up on the same time last year at 659 million tonnes. Overall airfreight gross profits were up by two per cent.

Panalpina puts this rise to the majority stake acquired last year in Airflo, the second largest airfreight forwarder in Kenya. The perishables business has contributed six per cent of its growth.

The freight forwarder has seen overall revenues decline and net profits go up. Revenues fell 13.7 per cent in Q3 compared to Q3 in 2015 while net profits were up 2.7 per cent to 24.6 million Swiss Francs ($24.7 million).

WorldNews CHAMP Cargosystems has implemented its Cargospot suite for Cathay Pacific’s cargo operations. The software has been customised for Cathay and further enhanced with CHAMP’s business intelligence tools.

The two are now working on replacing the airline’s cargo revenue accounting systems with Cargospot Revenue.

CATHAY Pacific has launched a new route to Tel Aviv and will start the four-weekly service from 27 March, 2017 - subject to government approval. Cathay will run an Airbus A350 on the route.

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NEWSWEEK HACTL improving processes

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hile Hong Kong International Airport (HKIA) starts constructing its third runway, Hong Kong Air Cargo Terminals (Hactl) is working on making its processes more efficient for customers, chief executive Mark Whitehead tells Air Cargo Week (ACW).

Speaking at The International Air Cargo Association Air Cargo Forum in Paris last week, Whitehead explained to ACW it is working on efficiency. He says over Hactl’s 40-year history it has always strived to meet customer needs such as changing hours when freight forwarders can deliver or pick up cargo.

He says: “We have recently changed the hours when a freight forwarder can deliver the cargo or pick that cargo up from Hactl and shaved off two hours.

“He can now deliver cargo three hours before the flight departure so that allows him to consolidate in his warehousing, be more efficient

in consolidating and then delivering to us.”

Whitehead says Hactl is constantly enhancing IT capabilities with apps to assist people in way they operate, noting: “Truckers that have a mobile phone can have an app to give them information when the flight that they are meant to be meeting, when its arriving, where their truck will be so they can drive straight in, take receipt of cargo and drive out.”

He adds Hactl is always striving to move cargo speedily through its terminal.

Turkish gets CEIV certificate from IATA

THE International Air Transport Association’s head of cargo, Glyn Hughes (second right above) presented Turkish Airlines officials with the Center of Excellence for Independent Validators’ (CEIV) Pharma certificate at the Air Cargo Forum last week in Paris.

A ceremony was held at the Turkish Cargo stand where Hughes was joined by key figures from the carrier, which continues to ramp up its freight operations.

The CEIV certificate covers not only the freight arm Turkish Cargo, but bellyhold operations on Turkish Airlines services and for its pharma facilities at Istanbul Ataturk Airport.

Turkish Airlines senior VP of cargo, Seref Kazanci says gaining CEIV means customers can have the “confidence that their sensitive cargo will be handled at every stage in the process – in accordance with the very best practices”.

Pharma shipments include vaccines, biotechnological products, diagnostic samples, precision healthcare devices, organs and tissues.

NAC to run charter freighters from MIA

US freighter airline Northern Air Cargo (NAC) will operate four weekly charter cargo flights from Miami International Airport (MIA) from 1 November, 2016.

This will include two weekly roundtrip freighter flights on a triangular route between MIA, San Juan and Saint Martin; one weekly flight that will operate between MIA and Santo Domingo; and one weekly flight that will serve a triangular route between MIA, Port-au-Prince and Santo Domingo.

NAC will use a Boeing 737-300 Freighter aircraft for the new service.

Miami-Dade Aviation director, Emilio T. González says: “We look forward to welcoming Northern Air Cargo to MIA, and we wish them success on their expansion to the Latin American and Caribbean region.

“MIA’s vast route network across the

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globe, in addition to our evolving cargo logistics infrastructure, continues to attract freighter airlines from around the world.”

NAC is the third all-cargo airline to start service at MIA this year. In April, Canadian airline KF Cargo launched charter freight service between MIA and multiple points in South America.

In November, US carrier 21 Air is scheduled to begin eight weekly roundtrip freighter flights to Latin America, with six weekly frequencies between MIA and Bogotá, and two weekly flights on a triangular route between MIA, Panama City and Guatemala City.

NAC and 21 Air will join MIA’s current total of 107 passenger and cargo-only airlines – the most of any US airport.

MIA exhibited at TIACA’s Air Cargo Forum in Paris last week.

NEWS WEEK Viracopos looking to boost cargo

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ao Paulo’s Viracopos International Airport in Brazil is running an incentive program for cargo carriers as it looks to strengthen international hub’s cargo activities.

The program aims to develop Viracopos as an international cargo hub, and the gateway’s operator – Aeroportos Brasil Viracopos – wants to increase the number of international flight routes and cargo frequencies.

Some of these proposals include 100 per cent exemption of landing fees for operations at the airport’s Cargo Terminal.

Companies already operating flights in Viracopos, or that intend to do so, may also benefit, provided they meet the eligibility requirements in a cumulative manner.

In the case of codeshare flights, only the airline operating the flight will receive the incentive.

The new incentive program will be in effect until 31 December, 2017. According to the Viracopos Commercial Board, other commercial incentives that do not refer to fees can be negotiated separately.

Fruitful month for Brussels

Viracopos commercial director, Jorge Lobarinhas says: “The new program offers attractive, transparent and nondiscriminatory incentives and with them, the airport will further strengthen its positions as the largest cargo airport in Brazil.

“At Viracopos the airlines are always treated fairly and with equality, generating business opportunities.”

The incentive proposal is valid for all cargo airlines that have regular commercial flights when they start an international route or frequency from and to Viracopos.

They must meet different requirements and the incentive provides cargo airlines operating in Viracopos, in case of an additional frequency, 100 per cent exemption of landing fees for the first 12 months of operation.

In the case of new routes, the program provides a landing fee exemption for the first 24 months of operation.

For new companies with operations of at least two regular weekly frequencies, a landing fee exemption of 100 per cent is provided for the first 24 months of operation.

BRUSSELS Airport’s tonnage figures in September rose sharply year-on-year (YOY) by 8.5 per cent - which the gateway puts mainly down to the freighter segment.

The gateway handled 42,906 tonnes, up on the 39,533 tonnes in the month last year. Freighter traffic was up 31.2 per cent to 14,657 tonnes due to Singapore Airlines Cargo, Qatar Airways Cargo and Ethiopian Cargo – the last two started operating extra flights in September.

The express services segment rose YOY by 2.5 per cent to 17,534 tonnes, up on the 17,104 tonnes which was put down to growth of e-commerce.

Bellyhold cargo dropped by 4.8 per cent compared to September last year, due to a decrease in the number of long-distance flights compared to September last year be-

cause of the departure of Indian carrier Jet Airways.

After nine months of the year, Brussels Airport has handled 352,951 tonnes, a 3.4 per cent fall on the 365,402 tonnes in the same period last year.

IAG to run New Orleans belly route

IAG Cargo will start a new bellyhold route from Heathrow Airport to New Orleans International Airport from 26 March, 2017.

The new Louisiana state service will be served by a British Airways Boeing 787-8

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aircraft, which has a bellyhold hold capacity up to 15 tonnes four times a week to and from New Orleans.

IAG Cargo commercial director, David Shepherd says it will add to its strong network offering in North America, adding it will mean emergency shipments, such as machinery parts and oil and gas components from the local area will benefit.

IAG says Louisiana has a GDP of $243.3 billion with perishables, oil and machinery parts being key export commodities from the region.

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ACF REVIEW

Collaboration pledge to secure future of air cargo

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irfreight chiefs pledged to collaborate more to ensure a more efficient and safer supply chain at the opening day’s Plenary session at The International Air Cargo Association’s (TIACA) Air Cargo Forum in Paris last week.

TIACA’s biennial event took place from 26-28 October and the theme this year was - Air Cargo Vision 2020: An open sky to innovation.

More than 3,000 air cargo professionals and 200 exhibitors from around the world networked and address the principal industry challenges while exploring future business opportunities.

Delegates in the opening plenary heard TIACA secretary general, Doug Brittin, International Civil Aviation Organization (ICAO) secretary general, Dr Fang Liu, and World Customs Organization (WCO) deputy secretary general, Sergio Mujica give their commitment on cooperating to secure a bright future for air cargo.

Delegates also heard he airfreight industry must digitise and works towards a paperless environment to ensure competitiveness, notably for e-commerce, while advanced screening

technologies are also vital to make sure there is an efficient and secure network.

Brittin says: “We are living in a period of great transition for our industry, and collaboration among all members of the air

cargo community has never been more important.

“Together we can work towards a common goal to ensure that new legislation does not impact air cargo flows, as well as to find solutions to ongoing challenges such as cargo delays, restrictions on the transport of lithium batteries and the impact of big data on our industry.”

Mujica feels efficiency and success is “all about coordination” but says “nobody likes to being coordinated”. He also explains the WCO is aware that Customs can be “an obstacle” if it cannot be modernised.

He notes the two biggest challenges are Pre-Loading Advance Air Cargo Information (PLACI) - in working together to solve some of the operational problems and the e-commerce boom, which is proving especially challenging for air cargo.

ACF was opened after the opening plenary by TIACA chairman, Sanjiv Edward; Aeroports de Paris deputy chief executive officer, Edward Arkwright; and Air France KLM Martinair Cargo executive vice president, Alain Malka (pictured left).

It was also revealed that the next ACF will take place in Toronto (Canada) from 17-19 October 2018.

Fresh is the flavour of the game

PERISHABLES are now the flavour of the game while hi-tech products such as laptops are declining, provided an interesting discussion point for air cargo professionals.

At the session, ‘Air Cargo – What lies ahead?’ on 26 October, key figures from Boeing Commercial Airplanes, Airbus and Seabury joined TIACA vice chairman and Jan de Rijk Logistics chief executive officer, Sebastiaan Scholte to discuss what may happen over the coming years.

Scholte, who chaired the session was joined by Boeing’s vice president marketing, Randy Tinseth, Airbus head of freighter marketing, Oliver Von-Tronchin and Seabury’s senior vice president, Marco Bloemen.

Bloemen explains: “Perishables are the growing commodity, who would have known that eight years ago? They are now the flavour of the game. Pharma is the one everyone talks about, but it still only represents 600,000 tonnes of the 20 million tonne total. It is still not the holy grail, perishables are still the one to watch.”

He says in the early 2000s, hi-tech was the driver, particularly laptops, but this has slowed as the demand for the item has generally reduced. Bloemen also says express and e-commerce will outstrip general airfreight in the years to come, and though this is generally domestic, cross-border e-commerce is expected to grow in the coming years.

How the market has grown was an important discussion point, with Scholte stating that the market today is very different from 10 years ago, as it continues to recover from the financial crisis of 2008, the threat of terrorism and protectionism all affecting global trade.

Tinseth is confident growth will return, and it is a matter of when, not if. In his 35 years with Boeing, he says he has seen the market grow six times, though even a man of his experience cannot predict what the future might hold but predicts e-commerce and express will grow strongly: “The package business is a very good business, e-commerce will only be good news for that, there will be new competition and a strong customer base. Amazon will figure out how to compete.”

Von-Tronchin predicts Middle Eastern carriers will overtake European and US rivals, while the express business will remain in the top 10. “We expect Chinese express carriers to move into that area, it is not clear if Alibaba or someone doing business for them will be there. Amazon have started flying, during the trial period they will see if they can do it better and if they can fully move into international express.”

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ACF REVIEW

Embrace modern technology, industry urged

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here is a need for more integrated technology in the air cargo supply chain, The International Air Cargo Association’s (TIACA) Air Cargo Forum heard last week.

In the conference session ‘e-Business Challenges’ panelists discussed how industry can better meet the opportunities that e-commerce presents, while also dealing with the undoubted challenges that exist.

The International Air Transport Association’s head of cargo, Glyn Hughes explains to delegates: “There is a necessity in industry that we have to collectively serve the needs of the consumers.

People need transparency, predictability to serve e-commerce and simplicity. We have to embrace modern technology to a much greater degree.”

Hughes says there is not a lack of technology in the marketplace, but he feels it is more about integrating it to better meet challenges in the supply chain.

One panelist in an optimistic frame of mind was Air France KLM and Martinair Cargo e-Freight project manager, Jean-Louis Salfati who says the industry is working in the right way and the

mind-set to meet e-business needs is changing.

He says: “I think the revolution is taking place and it is ongoing maybe a little slow, but it is there and it has to be done with higher security and higher expectations of the customer.”

Sodexi chief executive officer, Jerome Balbi hails the potential of e-commerce, which he feels is a great opportunity for air cargo, but warns of the challenges the sector presents. “It is a good opportunity for air cargo to get these huge volumes, but it brings a lot of pressure on prices, and a risk on the yields,” he adds.

For FedEx managing director and TIACA board member, Frank Newman he believes there are three critical components to meeting e-business challenges now and in the future.

He says the first one is about education and understanding – listening to what customers want but also explaining what the constraints are.

The second one is engineering and planning, as operators have to work with airlines and freight forwarders about how we can add speed to meet the needs of e-commerce.

The last one he says is change management and implementation of processes, which could be the most important of all: “The winners are the people that can implement change fast and they will be the overall winners in this sector.”

All panelists feel air cargo operators need to face change and encourage change towards digitisation to meet the needs of e-commerce and leverage the digital technology that exists.

Hughes also warns industry should not lose sight of disruptive technologies and it must be aware there are disruptors coming, while there is a need to collectively come to solutions to work out what customers are looking for.

3D printing a risk to air cargo

AS much as 42 per cent of air cargo is at risk from the rise of 3D printing, was one of the major talking points of the ‘Manufacturing and Market Trends that will Shake the Industry’ session at TIACA’s Air Cargo Forum last week.

During the session on 27 October, panellists discussed 3D printing, changing trends and whether the industry is as technologically advanced as it thinks it is. The session was chaired by Agility Logistics chief executive officer, Essa AlSaleh, who was joined by Global Shippers’ Forum secretary general, Chris Welsh, Tosoh Corporation manager – supply chain & general affairs, Lars J.T. Droog, Accenture Freight & Logistics global lead and managing director, Adriana Diener, CHANEL Fragrances and Beaute head of transportation and customs, Pascal Meyer, and PwC partner, Andrew Schmahl.

Schmahl says PwC research showed 42 per cent of air cargo could be at risk from 3D printing. He says: “What we can do now is look at the portfolio of our clients and see how disrupt able it is and ask them do you work with clients ship lots of things that are 3D printable? There are things you can do to rebalance the portfolio then you’re in better position than competitors.”

Droog told delegates he wanted to know why the industry was not sharing information. “We are responsible for the inventory for the customer, when we know about usage in real time we can use the information for ordering product.

We would like to see visibility in the chain or supply chain, sharing data is possible though there is still some kind of resistance.”

Diener feels the emphasis used to be on globalisation of manufacturing as production moved to countries with cheaper labour costs, which was good for shippers as goods had to be moved further.

She says more robots will reduce this need, saying: “In the manufacturing industry, imagine a world where robots play a big part of the process, labour will no longer be a big factor.

More automation is more likely to move manufacturing on or near shore because the cost will be about the same.”

Diener adds the way of life is changing for millennials as they are less inclined to buy products, instead using the sharing economy like Uber or hiring a bicycle when needed.

She says: “This is not great news for shipping, how this impacting us, how we react to this is not in the future, those trends are here and need to start acting on it.”

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AIR CHARTER ACS aiming for further growth as it sells minority stake

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his year has been a good one for Air Charter Service (ACS) but it is certainly not resting on its laurels and is eyeing further growth.

For the first six months up to 31 July, charter numbers increased nine per cent over the same six months in 2015 - to more than 5,800.

This performance came despite no special events like the US West coast port strike in early 2015 that boosted business abnormally for a three week period.

Away from full charters, its revamped onboard courier division is doing nicely, with an increase of 94 per cent and on track to hit 1,000 jobs this year.

ACS chief commercial officer, Justin Lancaster (left) tells Air Cargo Week: “We cannot ask for more, just to keep it going. It’s been a positive year considering the special events of last year.”

Lancaster is hopeful for a good end to

the year as he feels there is not a huge amount of capacity in the marketplace and he sees growth continuing for the rest of 2016, but observes predicting the performance of cargo charters is near on impossible due to sudden worldwide nature disasters,

conflicts or one-off events.

Lancaster says the charter broker firm’s staff have been key to performance and more are staying with ACS, which helps drive business, as for brokers it is all about building relationships and ACS employees are doing just that.

He says different regions are proving challenging and more fruitful: “Europe has been quite strong and it is a very mature market and the Americas and the Far East has been pretty good, but Africa has been slow due to the oil and gas industry which has slowed down. If oil and gas had not slowed we would be doing even better.”

The collapse of the oil and gas sector due to falling oil prices has had an impact for many charter brokers, including ACS. Lancaster says many of the industry contacts have gone under, but he is optimistic it will come back and forecasts oil prices will rise. Crude oil was $52 a barrel in October, according to the International Air Transport Association.

He notes: “I think it will be $60 in 2018 and go from there and industry will reset and get costs back to normal. They will do more charters and there are projects, as they take years to come to fruition, but many projects are being shelved, which we will probably see the impact of next year.”

Acquisitions planned

Earlier in October, ACS sold a minority stake to Alcuin Capital Partners, which it said was to help it accelerate its growth plans, although it didn’t reveal what the exact cash injection was.

Lancaster says it will bring access to capital and Alcuin’s expertise in corporate acquisition strategy will prove invaluable for implementing growth plans.

He notes: “Lots of people were interested (in a stake) and it definitely adds a different dynamic to the business. We have always grown organically which can be a longer game and can take time.

“Having private equity will hopefully lead to more acquisitions rather than having to do all the growth organically and it will speed up the process and growth.”

Lancaster could not reveal exactly what acquisitions it was targeting, but notes there are various options for ACS on both the passenger and cargo side of the air charter market: “It is early days, but that will start to come to light in the next six to 12 months and we will then see the benefit of that investment. Their expertise in acquisitions will help us.”

But Lancaster does not expect an announcement in the next few months on any acquisitions, but says it will be “exciting times” at ACS and declares “watch this space”.

Strategically located offices

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ACS now has 20 offices around the globe with at least one in every continent, and it will continue to open offices strategically Lancaster explains, but he says it will carry on with the model of opening office where it can operate all of its divisions.

Different regions offer contrasting opportunities and he feels ACS can have for example a regional cargo hub in Asia, which it would not be able to in other markets, while he notes the passenger and cargo charter markets are very different across regions.

Lancaster says for him personally, cargo is his favourite side of the air charter business as you can be doing something different everyday, from moving a giraffe to a turbine.

However, cargo he feels is the toughest sector of air charter to grow, especially in mature markets like Europe, but in saying that, cargo will always be and remain “his love”.

AIR CHARTER

Strong demand for Boeing 747 charters

C

hartersphere is continuing to consolidate its growing reputation by offering a high quality alternative in a competitive marketplace, managing director Paul Bennett (pictured) tells Air Cargo Week (ACW).

He says though this year has generally been slower in terms of opportunities compared to 2015, there has been a significant increase in demand for Boeing 747 flights of consumer goods from China to Europe and Africa, something he expects to continue for the rest of the year.

Bennett tells ACW: “We have also seen solid gains for our government and NGO charters to some of the more remote locations in Africa and Central Asia especially for IL76 flights. Again, this is an area we anticipate continuing to develop into 2017.”

He adds: “There are a lot of unpredictable factors still clouding the horizon at the moment but we are confident that demand for more B747 consumer goods charters from China will remain strong as will continuing opportunities for IL76 flights on behalf of our government and NGO clients.”

Chartersphere put 747s and IL76s to good use in one particularly complex job for a client bringing freight from China to multiple locations in Africa and the Middle East by trans-shipping through the UAE combining the flights to meet the client’s requirements.

“The Chartersphere team were able to exceed our client’s expectations with a one-stop-shop proposal that satisfied them on price and time critical cargoes” Bennett comments.

Chartersphere has also started offering passenger charters, designed to compliment the cargo business. Bennett says this has help enhance the company’s reputation and has attracted high profile clients including world leaders, telling ACW: “Diver-

sification allows us to provide a more complete service to our clients whose needs can often include both cargo and passenger charters.

“We are very pleased with the way the passenger department is progressing and believe it is further strengthening the Chartersphere brand in the global marketplace.”

The Chartersphere team is expanding, welcoming Mark Middleton to the team.

Bennett says: “Mark is a highly-respected broker with an international reputation built over 30 years in the industry. He will be using his vast experience and extensive contacts to lead the development of our brokering team over the coming months.”

Bennett is also looking at the Middle East, he tells ACW: “The Middle East remains an area of continued opportunity for us and we are actively considering the possibility of expansion there to support our regional growth plan in some key markets.”

Bennett says the biggest challenge all players in the cargo charter market is increasing value in a competitive market, but he thinks Chartersphere remains in a strong position.

“Our team is one of the most experienced and forward-thinking in the business and we are wellplaced to continue to provide innovative charter solutions to our growing client list.

“Despite the challenges, we are confident that opportunities for companies able to bring added value for clients will continue to grow. This is particularly true in emerging markets such as Africa,” he explains.

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JAPAN NCA maintenance warning

N

ippon Cargo Airlines (NCA) has been issued with a serious warning for inappropriate maintenance work on the engine of a Boeing 747-8 Freighter.

The Ministry of Land, Infrastructure, Transport and Tourism issued the warning regarding a repair procedure carried out by a group of mechanics on the engine of the 747-8F, JA18KZ. The airline says tasks including the determination of the maintenance method, control of procedures, inspection of the work and creation of the maintenance records violated regulations under the Civil Aeronautics Act.

NCA says it takes “the occurrence of these violations extremely seriously” and will review the measures to make sure it does not happen again, and has submitted a report to the Ministry.

It says: “Nippon Cargo Airlines deeply regrets and apologises for causing such concern to the public and remains committed to improved implementation of safe operating procedures as the company takes corrective actions necessary to prevent such incidents from occurring again.”

NCA has a fleet of five 747-400Fs and eight 747-8Fs.

Winter schedule for ANA

All Nippon Airways Cargo (ANA) has upgraded its flight schedule for winter, with new flights to some cities, reduced and cancelled services to others, and changing aircraft on certain routes.

On 30 October, ANA started six flights a week between Guangzhou and Okinawa and Osaka and Nagoya, and increased Okinawa – Narita services from six a week to seven.

Between 30 October and 30 December, Narita – Osaka, Osaka – Shanghai and Shanghai – Narita services will be increased to six a week, and again from 16 February to 25 March 2017.

Other services have been either reduced or cancelled from 30 October. The seven

times a week Guangzhou – Narita service has been cut to one, Osaka – Okinawa was reduced from 12 to six a week and Okinawa – Narita has gone from six a week to five.

ANA has cancelled the one Singapore – Narita and six a week Narita – Nagoya services.

As well as route upgrades, ANA is now using a Boeing 767 Freighter on its Narita – Okinawa and Okinawa – Narita flights instead of a Boeing 747 Freighter.

Between April and August ANA handled 322,619 tonnes of international cargo and 10,444 tonnes of mail.

On domestic routes the carrier handled 190,699 tonnes of cargo and 12,566 tonnes of mail.

Kansai’s tonnage up and routes added

OSAKA’s Kansai International Airport handled 59,512 tonnes of cargo in August, a five per cent surge on the same month last year.

International freight drove the increase at 58,050 tonnes, up six per cent on August in 2015, but domestic cargo fell by 17 per cent to 1,462 tonnes and so far in 2016 Kansai has handled 456,804 tonnes.

Osaka International Airport, which only operates domestic flights saw cargo grow by one per cent in August to 11,671 tonnes and so far in 2016 it has handled 85,523 tonnes.

Meanwhile, Asian carriers have been adding new bellyhold routes and increasing frequencies into Kansai International Airport.

Vietnam Airlines started a new daily bellyhold route on 30 October from Ho Chi Minh City to Kansai using an Airbus A350. The carrier also plans on operating an larger aircraft, an A330 instead of an A321 from Hanoi to Kansai, which will also be daily.

Korean carrier Asiana Airlines will also increase the number of services it runs from Incheon International Airport to Kansai 21 to 28 flight per week from 11 November using an A321.

New bellyhold routes were also launched to China in the summer as on 1 August Juneyao Airlines started a four flights a week service from Nanjing to Kansai using an A320.

Tianjin Airlines launched a two flights a week service on 3 July to Kansai from Dalian using an A320 and Hong Kong Airlines started daily flights from Hong Kong to Kansai on 15 July using an A330.

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TRADEFINDER Airlines

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Freight Forwarders Hong Kong

United Arab Emirates

USA

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