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The weekly newspaper for air cargo professionals Volume: 19
Issue: 22
6 June 2016
Boost for air cargo as IATA reports April uplift
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lobal air cargo markets motored in April as overall they grew yearon-year (YOY) by 3.2 per cent, the International Air Transport Association (IATA) reports. Demand measured in freight tonne kilometres rose in the month compared to the same month last year. Despite the positive news, IATA says yields remained pressured as April freight capacity measured in available freight tonne kilometres soared YOY by 6.6 per cent. IATA explains while growth in April appears to be stronger than in the preceding months of 2016, this is largely due to the disappearance from the comparison data of distorting factors associated with the 2015 strike at seaports on the US West Coast. IATA says overall, demand for air cargo “remains soft” and lags behind the relatively robust growth on the passenger side of the business, and is largely driven by weak world trade. In the first quarter of 2016, there was the first annual decline
in trade volumes since the global financial crisis in 2009, and the World Trade Organization (WTO) predicts only sluggish growth for the remainder of 2016. IATA’s director general and chief executive officer, Tony Tyler notes: “While the April uptick in demand growth for air cargo is encouraging, the overall economic environment is not. The decline in global trade does not bode well for air cargo markets in the months ahead.” The increase in demand was
broad-based across all regions with the exception of Latin America, which fell 5.9 per cent, while capacity was down by 0.7 per cent. The strongest growth occurred in the Middle East and Europe, with April demand up by 7.7 per cent and 6.8 per cent, respectively, while capacity was up 11 per cent and 5.6 per cent, respectively. Despite leading demand growth, the Middle East’s figure was half of what it was in April 2015, put down to the slowdown in network expansion and weak trade.
Europe saw its highest surge in freight volumes since November 2013 and it corresponds with a rise in export orders in Germany, but despite the upward trend performance remains weak in Europe in historical terms. Demand in Asia Pacific was flat at growth of one per cent, and capacity rose by 2.8 per cent. The largest factor impacting the stagnation is weak trade - both globally and in the region. North America saw demand grow by four per cent in April, as exaggerated effects of last year’s US seaport disruption wore off, while capacity was up 9.2 per cent. In Africa there was no change from April last year, but capacity shot up a significant 24.3 per cent, due to long-haul expansion by airlines into the region. IATA says in April, carriers in Asia Pacific had 38.9 per cent of the total air cargo market, followed by Europe with 22.4 per cent, North America 20.5 per cent, the Middle East 14 per cent, Latin America 2.8 per cent and Africa 1.5 per cent. (Picture above courtesy of CAL Cargo Airlines).
Dubai facility opened by freight powerhouse DB Schenker DB Schenker has opened its first facility that it owns in the Middle East, based in the Dubai Logistics City (DLC) next to Al Maktoum International Airport. The logistics centre at DLC has 7,200 square metres of warehouse space with two mezzanine levels for value added services and spare parts operations. It also contains temperature-controlled areas. The facility will be expanded and DB Schenker will have a footprint of 25,000 square metres by 2019. DB Schenker regional head of contract logistics / SCM, region near Middle East / Africa, Ako Djaf says: “Dubai is our main hub in the region, and investing in the DLC was a strategic step to
strengthen our network and to complete the DB Schenker service coverage in UAE. “Being located only a few metres away from the runways of Al Maktoum airport and Emirates Road and only 15 minutes away from the
Seaport enables us to offer first class integrated transportation and warehousing solutions for our global customers.” Dubai South vice president of logistics, Mohsen Ahmad says: “It is about speed, connectivity and getting the goods on time to end users. “That is where by partnering with global players like DB Schenker we can make a difference and make this place a truly ecosystem and one of the key hubs of the global trade.” The DLC will have 12 million tonnes of air cargo capacity by 2023 and is based near Al Maktoum International Airport and Jebel Ali Port. It incorporates 25 square kilometres of free zone for the supply chain.
BRUSSELS ON THE RECOVERY PATH VIRGIN AND DELTA STRENGTHEN TIES
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CHANGI SET TO SEE EXPRESS AND ECOMMERCE GROW
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US CAPACITY INCREASED BY QATAR AIRWAYS
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Qantas Freight to run freighter into Dallas QANTAS FREIGHT has added Dallas Fort Worth to its weekly round trip connecting Australia with China and US. The Boeing 747-400 Freighter service will stop in Dallas from 9 June, and every Thursday. Qantas says the Dallas stop will be ideal for bringing electronics, e-commerce and general cargo into the US from China and energy, mining and aerospace products from the US to Australia. Qantas chief executive officer – international and freight, Gareth Evans says: “Qantas Freight has operated a well-supported freighter route between Australia, China and the US for twelve consecutive years. We are pleased to keep meeting the needs of our customers by adding another southern US freight gateway into our scheduling. “Qantas already carries freight in the belly space of our daily A380 services between Sydney and Dallas Fort Worth. The addition of this freighter service now gives us capacity for main deck and oversize shipments. This additional service reinforces the Qantas Group’s commitment to the Texas region and responds to demand we have for bringing larger loads and outsized shipments into Australia.”
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NEWSWEEK
Slight growth, but no air cargo spring just yet
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harmaceuticals and perishables keep propping up the performance of air cargo, according to market analyst WorldACD. The industry analyst says in April, the 2.52 per cent year-on-year (YOY) growth was the outcome of 1.4 per cent growth in general cargo, and six per cent in non-general cargo as perishables were up 4.8 per cent and pharma up 12.3 per cent. North America was the top grower in perishables with 14 per cent, in which South America, a traditional powerhouse in this sector, has been losing market share in the last few months, while the Middle East and South Asia saw growth of 16.6 per cent and Europe 7.3 per cent. WorldACD says after a very modest first quarter, April at first sight gave cause for a little optimism as worldwide volume growth YOY of 2.5 per cent is a figure “we had not seen for quite a while” - but a closer
look “tells us how we should interpret it”. This year, April saw five Fridays and Saturdays, traditionally good air cargo days, while last year it had four. On top of that, the month did not suffer from a negative “Easter-effect”, as it had done in 2015. WorldACD observes: “Our best estimate is these two differences in the April
pattern may be accountable for most of the YOY volume growth. Otherwise, April showed remarkable similarities to trends noted in the first quarter. Africa and Europe remained the origin areas with strong weight growth YOY, this month by 6.9 per cent and 6.3 per cent respectively. “The Americas continued to drop in volume: some consolation may be found in the fact that USD yields from these origins hold up better than those in other parts of the world. North America was the only area showing a USD yield growth monthover-month (MOM), albeit by 0.1 per cent. Central and South America have the best YOY yield performance for the year.” WorldACD says MOM yield worldwide, measured in USD, dropped by 0.5 per cent and volumes excluding China increased by considerably more than volumes from most other countries in Asia Pacific, YOY yields from China were suffering again.
CHAMP to work with Senegal
CHAMP CARGOSYSTEMS and Senegal Customs have started work to implement Advance Electronic Information (AEI) filing for air cargo shipments for Senegal. AEI will give better visibility, reduce clearance time for shipments and increase security. The aim is to start the mandatory pilot phase as of 1 June and then go live by 1 September. As part of the agreement, CHAMP has performed an analysis into Senegal’s Customs requirements, a gap analysis and together with Senegal Customs helped defining the specifications for WCO world format XML schema. CHAMP Cargosystems vice president of global sales and marketing, Nicholas Xenocostas says it will not only help them improve collaboration between customs and trade, but take some fundamental steps in increasing security against terrorism and international crime. Countries in Africa are looking into adopting forms of AEI filing to increase efficiency, accuracy, speed and reduce costs.
AFKLM renews RFS contract
AIR FRANCE KLM CARGO has renewed its road feeder service (RFS) tie-up with Jan de Rijk Logistics covering Scandinavia. The contract renewal connects the Amsterdam hub with Air France KLM stations in Denmark and Sweden. Jan de Rijk will operate daily less than truckload (LTL) overnight services in both directions. The transportation and logistics firm provides LTL services between the Netherlands and Scandinavia for various industries, and has been increasing services for the Scandinavian perishable and industrial markets. Jan de Rijk Logistics senior sales executive air cargo, Robert Kleppers says it is recognition of the hard work it has put into the quality of RFS and adds: “Jan de Rijk Logistics is also TAPA TSR1 [Transported Asset Protection Association Trucking Security Requirements] and IATA CEIV [International Air Transport Association Center of Excellence for Independent Validators] Pharma Handling certified, so we can offer any kind of service that will make Air France-KLM Cargo’s cargo proposition for the region even more compelling.”
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CCA: Closer collaboration needed to cut cool chain food wastage
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loser collaboration with shippers is essential in the fight against global food wastage in the cool chain, the Cool Chain Association (CCA) says. Delegates at the CCA Perishables Summit in Barcelona, Spain heard all stakeholders must find collaborative ways to reduce waste by at least 10 per cent by 2025. The association says this would represent 250,000 tonnes of savings worth about $1 billion in value and one million fewer tonnes of emissions. CCA chairman, Sebastiaan Scholte (pictured) says: “Food wastage is a major issue and one which we must focus on as an industry. Working together, we can find ways to fight back and make a difference, whilst at the same time adding value to the supply chain.” Scholte is also the chief executive officer of Jan de Rijk Logistics and vice-chairman of The International Air Cargo Association. Delegates at the summit debated trends in the perishable industry including shifting global
buying patterns, environmental pressures and emerging trade routes. It was predicted that the perishable airfreight market will remain strong despite the threat of modal shift. CAA member, Air France KLM Martinair Cargo business development manager – fresh,
ECS-Aeromexico Dutch link-up
Americas, Janet Coldebella says shippers have attempted ocean freight though several have moved back to airfreight. “Transit times are still too long to guarantee the quality and shelf life that retailers demand. Cost is important, with retailers focused on shelf life, but there is a new generation of consumers who want fresh, seasonal produce and they are prepared to pay more.” Delegates heard 80 per cent of perishable imports go to developed nations but the industry needs to adapt to shifting trade patterns to cater for the demands of the middle classes in emerging economies such as China and India. WorldACD director, Ken de Witt Hamer says: “Perishables products by air showed much higher growth than the overall cargo market in 2015, and we see this trend continuing in 2016. Future food demand may increase food sourcing outside Asia for Asian countries, given more competition for land use, increased demand and challenges for water.”
NEWS WEEK WorldNews Geodis has increased its presence in Mumbai, India after relocating its premises to The Qube in Andheri. The freight management and logistics firm says it is driven by the continuous growth of its India business and expansion of the Mumbai team. Geodis has been present in India since 1998, operating from 14 locations in the country and in India’s western region Geodis has offices in Mumbai, Pune, Ahmedabad and Baroda. PEMCO WORLD AIR SERVICES (PEMCO), has redelivered its first Boeing 737-400 passenger-to-freighter (P2F) aircraft to Salam Aviation. The newly PEMCO-converted aircraft features 11 pallet positions, up to 48,000 pounds of payload, and 4,600 cubic feet of total volume.
Aeroméxico has appointed the ECS Group company, Globe Air Cargo, as its general sales and service agent in the Netherlands. The appointment, effective from 29 May, will focus on all European products, including perishables, pharmaceuticals and other niche products, and ECS says it offers opportunities at Amsterdam Airport Schiphol to shorten transit times for temperature sensitive goods. Aeroméxico operates 25 flights a week between Mexico and Europe, with a widebody capacity of 700 tonnes. ECS chief operating officer, Adrien Thominet says: “We are delighted that Aeroméxico has chosen Globe Air Cargo to intensify our long-standing partnership, which has proved over the years to be very successful.” “We have been supporting other destinations of our partner such as Madrid, Paris and London Gatwick on a daily basis. Now it is time to offer our Dutch customers a direct service and to strengthen Aeroméxico’s activities in Europe. We feel very honoured by Aeroméxico’s trust.” ECS has 108 offices in 39 countries with 58 subsidiaries.
ACS becomes bear charter service
AIR CHARTER SERVICE (ACS) became bear charter service when it moved three bear cubs from Georgia to Greece. The orphaned cubs, Georgia, Mollie and Louisa, were found wandering the streets of the Georgian capital, Tbilisi, following devastating floods, and then kept in the city’s dog pound. An animal charity and ACS arranged for the bears to be moved to bear sanctuary in Greece. ACS group commercial director, Justin Lancaster says: “The bears, Georgia, Mollie and Louisa, have been kept in completely unsuitable conditions for the past few months, but a charitable appeal by our client has resulted in the funds needed to help move them to the specialist Arcturos Bear Sanctuary in Northern Greece. Here they will be cared for by trained bear experts and be able to live in a much more natural and safe environment. “A lot of the work we do is moving essential cargo for industry but, every now and then, we get to be involved in a heart-warming tale such as this, and I am pleased to say that they arrived safely.”
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NEWSWEEK Free trade zone at Miami International MIAMI INTERNATIONAL AIRPORT is to become a designated free trade zone, delegates heard at The International Air Cargo Association’s (TIACA) Executive Summit in Hollywood Beach from 24-26 May. Miami-Dade Aviation Department aviation director, Emilio Gonzalez says the Florida hub wants to establish it in 2017, as it looks to become a global air cargo hub and adds: “Making the airport a free trade zone will pay huge dividends next year for Miami.” He says Miami is committed to investing in the cargo business and is a major part of the airport’s focus. “It (cargo) was not taken care of, cargo was always an after-thought as focus was passengers. We are working right now and are going to build up the cargo side of the business from the bottom up.” Gonzalez says infrastructure at Miami needs modernising and sees no reason why
it should not have “world-class facilities“ while it has 400,000 square feet of space available and adds: “We need that. We are a global air cargo hub but not a global air cargo facility. Then we can say we are a global gateway. We cannot just be the gateway to the Americas.” He notes Miami is in discussions with several major carriers about adding freighters, while it is targeting a route to and from Asia, but it is the biggest challenge due to the geographical distance. He says it is up to the hub to make sure facilities it provides are up to scratch for that route. Gonzalez notes he is concerned about the Brazilian market, and his expectation is it is going to “get worse before it gets better.” Miami serves 41 all-cargo carriers, while 66 per cent of perishables into the US move through it and 89 per cent of all flowers.
Shippers urged to speak to Cargo iQ CARGO IQ executive director Ariaen Zimmerman (right) has urged The International Air Cargo Association’s (TIACA) Shipper’s Advisory Council to talk to the International Air Transport Association interest-group. He has invited the council to articulate their questions and try to “find a place to optimise” by speaking with Cargo iQ, which was rebranded from Cargo 2000 in March this year. He was speaking at TIACA’S Executive Summit at the Margaritaville Resort in Hollywood Beach, Florida on 26 May in the plenary session ‘Air cargo challenges from shipper’s point of view’. Zimmerman tells Air Cargo Week: “We need the shippers to help us improve the quality part of the equation. We have not been an industry that has been able to visualise quality enough. Quality is not the central focus which it should be. “Bringing quality back into the equation needs the end people, the shippers. We need them to tell us what we need to know and we can work on it. We need their help.” Cargo IQ now has 82 members, and its strategy is to engage more with different parts of the supply chain such as shippers and also in the future small and medium-sized forwarders. Cargo iQ is focusing heavily on quality and innovation. Shippers voiced their concerns at the session, which was chaired by TIACA’s shipper council chairman Lars Droog, who is manager of supply chain and general affairs at Tosoh Europe. The council added members to the com-
mittee yesterday including Ericsson head of distribution logistics, Robert Mellin who was speaking on the panel and representatives from Chanel Fragrances and Beauté, Sandvik Machining Solutions, Marine Harvest RMT and Teva Pharmaceutical Industries. The shipper group is aiming to get the voice of shippers at the forefront of the debate in the air cargo industry and better understand their needs, demands and challenges by working with them from all industries. Droog explains to delegates at the session: “The main idea is to change the airfreight industry from a fragmented organisation to one where we have more collaboration, between all stakeholders – from shippers to forwarders and airlines and other parts of the supply chain – only then can we create the quality shippers require.” He feels here are plenty of opportunities for airfreight in the view of shippers, but there are also challenges such as overcapacity and warns of the modal shift: “Shippers are moving shipments from airfreight, for example trade from Asia to Europe they are using train connections, while pharma companies require temperature control throughout the chain, but this is also an opportunity for airfreight.” Other opportunities he says are technological innovations such as creating efficiencies using robots to move unit load devices, which shippers are introducing, but feels the main question the industry must ask itself is whether it adds further costs to the air cargo supply chain.
ACF in Paris now open for registration
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he International Air Cargo Association’s (TIACA) Air Cargo Forum (ACF) and Exhibition from 26-28 October this year in Paris is now open for online registration. The Forum takes place at the Porte de Versailles, will include practical workshops on new legislation, as well as debate on industry trends and innovation. TIACA’s secretary general, Doug Brittin (pictured) says: “The ACF, now in its 28th year, is a unique opportunity to network with specialists from the world’s leading air cargo companies, grow business, and learn from the experts. “With a raft of new legislation on the horizon and a dramatically changing business landscape, our
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three-day Forum will provide executives with the practical tools they need to stay ahead of the curve.” The Vision 2020 program includes a workshop explaining the new EU Union Customs Code, a session on the latest Advance Data legislation, a look at cargo hubs of the future, and a debate on the benefits of embracing the cloud. New this year for the ACF is CargoLinx, TIACA’s online meeting scheduler, which will allow dele to schedule up to 30, 25-minute meetings with 45 leading global air cargo companies, weeks in advance of the event. TIACA chairman, Sanjiv Edward says: “ACF is a world class opportunity to grow business connections”. Visit aircargoforum.org for more details.
PHARMA NEWS ROUND-UP
Pharma targeted by Envirotainer at new Delhi station
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nvirotainer has opened a new service station in Delhi, India to support growing pharmaceutical business in the cold chain. The move is part of its continued network expansion and expanded the company to 57 stations across EMEA, APAC and Americas. Partners and customers will have greater access to Envirotainer’s RAP t2 and RKN t2 containers in and out of the region. Envirotainer APAC head of sales, Suat Toh says: “India is a world player in generic drugs manufacturers and API supplier for decades. Envirotainer has been supporting Indian pharmaceutical needs by providing best-in-class cold chain solutions for pharma products that require a controlled environment since year 2000.” Toh continues: “With the more stringent regulatory landscape internationally, Envirotainer noticed Indian pharma manufacturers are continuously improving their cold chain quality management and strengthening the demand for high quality cold chain solution.” Envirotainer says in the future it will be looking into upgrading this station further to include release/return of e-containers. Customers in Delhi and the region have access
to e-containers through Envirotainer’s partners, who would be taking releases from Envirotainer’s stations located around the globe. Celebi Delhi Cargo chief executive officer, Ramesh Mamidala says: “It is an extremely proud moment for Celebi Delhi Cargo Terminal to have Envirotainer as its partner to establish a service station for Envirotainer containers at New Delhi. Celebi Delhi Cargo Terminal as a company has been very focused on creating a state-of-the-art cold chain infrastructure in the terminal and has introduced various value added solutions over the time to benefit the trade community.” He adds: “Partnership with Envirotainer is one of the much awaited initiative and we are extremely hopeful that it will receive a warm welcome from the cold chain community. We wish the upcoming venture to be a grand success and would like to thank the entire community for their continued support extended to us which have helped us to serve the industry in a better manner.” Envirotainer continues to enhance and evaluate its global network worldwide. In the past year alone, it has invested heavily in the Asian region and recruited new sales teams to Japan, China, India and Singapore.
DHL looking to gain CEIV across key facilities
DHL GLOBAL FORWARDING is to implement the International Air Transport Association’s (IATA) Center of Excellence for Independent Validators in Pharmaceutical Logistics (CEIV Pharma) certification across key facilities globally. The first phase of the CEIV certification will include 30 key DHL Air Thermonet GDP [Good Distribution Practices] Compliant stations worldwide. The assessments are set to start in the third quarter of 2016. The DHL station at Brussels Airport has already been awarded the CEIV Pharma Certification. The certificate encompasses IATA Temperature Control Regulations, European Union GDP, World Health Organization Annex 5 and United States Pharmacopeia Standards. DHL Global Forwarding global head of temperature management solutions, David Bang says: “The IATA CEIV certification is yet another initiative within part of our continuous improvement activities to ensure our specialised and compliant network is up to the latest quality standard that recommends DHL as the right partner to the life sciences and healthcare sector.”
IAG targeting pharma on new Chile route
IAG CARGO has launched a new route to Santiago, Chile from winter of 2016 and becomes the only carrier to fly direct from Heathrow Airport to Santiago International Airport. With the new service, IAG will now be able to offer customers a weekly lift of up to 3,360 tonnes into Latin America – and is targeting pharma cargo. The new service is set to become IAG’s longest direct route and will be served by a British Airways Boeing 787-9 aircraft. Flights will run four times a week to and from Santiago, and the new route adds to IAG’s expansion into Latin America. From summer 2016, IAG will also operate new direct flights from Madrid to San Juan, Puerto Rico and from Gatwick Airport to San Jose in Costa Rica and Lima in Peru. IAG’s head of sales, Camilo Garcia says: “This new route adds to our expanding network in Latin America. With perishables and pharmaceutical goods being key export commodities for this region. Our next generation aircraft with temperature control in the hold ensures that our time and temperature sensitive products are delivered in optimum condition for our customers.”
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BELGIUM Africa, horses and perishables keep Liege on the up
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iege Airport continues to grow and in the first four months of 2016 it has seen cargo volumes surge by five per cent. The gateway’s vice president of commercial, Steven Verhasselt explains Africa is the key trade lane: “Africa – Liege remains very strong, as perishables enter the European market in Liege, but also connect to the Middle East and the Americas. “Americas – Liege is performing strong as well, with both capacity growth and steady load factors, while our Intra-European business is picking up as well.” Perishables remain a key growth driver along with flowers, but also vegetables and fish, which enter the European market via Liege to be distributed onwards by truck. Verhasselt says another interesting trend is parcels via integrators, but also the parcels from e-commerce, are gaining market share over large shipments and charters.
Liege has opened a Horse Inn to further tap into the movement of live animals, and he notes: “Liege Airport is already very strong in the live animal markets. In 2015, more than 3,000 horses flew to and from Liege. The Horse Inn offers a better service for an existing business. We invest in facilities to become leaders in business segments where freighter operators have a competitive advantage over belly cargo. “Horse transportation is a great example. The Horse Inn will not as such generate huge expansion of the cargo throughput, but it will help freighter operators in competing in the market, by using a specialised cargo airport.” Verhasselt says horses are a growth sector, but on the one hand, for the scheduled services, horses are bringing to the freighter operators a commodity separating them from the belly operators. He adds: “On the other hand, a growing number of horse charters is operated for big equestrian events, like the Longines Masters, the Kentucky
Derby or indeed the Olympics.” The biggest mover of horses is Icelandair Cargo, from Iceland to Europe, on a near daily basis, while another buoyant line is the Middle East and USA, where Qatar Airways Cargo and Emirates SkyCargo are transferring a lot of horses via Liege. Infrastructure investments will continue, Verhasselt says: “At the first line, we intend to add handling capacity, both parking stands, ramp and warehousing. In the second line, we are developing a 400 hectares logistics zone. “The first projects are already defined. One of them is a pharmaceuticals hub, in co-operation with the biggest pharma shipper in the Liege area, for road-road and air-road connections. For the fast developing e-commerce business, operators already active in the warehouse will develop an e-commerce distribution centre, again combining road-road and air-road.” The biggest operating challenges he feels are capacity and making sure infrastructure and
services follow growth, adding: “Our industry depends on partnerships, and our challenge is to make the cargo community in Liege has the ties strong enough between all parties, to make these partnerships work for the long term.” As for the Europe’s air cargo market, he says it is stagnant at best and there is not a lot of “absolute growth” in the market, while competition is about market share, and more often than not, price is the determining factor. He says: “There is competition between airfreight and alternative modes, there is competition between general airfreight and integrators, and there is competition between belly capacity and freighter capacity. There are the big passenger hubs, who generate lots of cargo due to size (belly) and history (cargo community). There are freighter hubs who offer other assets and services. In the end, the shipper, and the logistics chain onwards decides on the gateways used.” Verhasselt does not expect a big upturn of the market, but feels Liege is positioned for growth.
LACHS to operate Liege’s Horse Inn
JUST in time for the Rio Olympic Games, Liege Air Cargo Handling Services (LACHS) has been awarded a three-year contract to manage the Horse Inn at Liege Airport. The Horse Inn is for horses being transported by air and accommodates them during transit by road. It represents an investment of 2.6 million euros ($2.9 million). LACHS is owned and operated by the CAL Cargo Airlines Group and is designed to upgrade Liege’s service provision for the transportation of live horses, which is set to increase ahead of the Olympics. LACHS general manager, Yossi Shoukroun says: “Global horse transport movements
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are so frequent that it is almost impossible to know the exact market size. However, the transport of horses for pleasure and sport is a rapidly growing market, and air travel makes the horses’ lives easier. “As experts in the transport of non-standard cargo such as live animals, we have invested a tremendous amount to ensure top-of-the-line infrastructure for this valuable cargo.” LACHS specialises in dedicated charters as well as scheduled routes and boasts experience in complex equine projects, including multiple charters of horses, and can handle a mass of horses on a tight timeline. LACHS maintains specialised flooring for horses, collapsible horse stalls and both standard and custom built crates for smaller animals. Often, the horse groom or escort will fly along with the animal, taking care of feeding and proactive care. With a view to developing this sector, Liege Airport has called on recognised experts, including Grégory Wathelet, the top Belgian show jumper and European runner-up, and Félix-Marie Brasseur, twice world individual driving four-in-hand champion.
BELGIUM Brussels Airport on the recovery path after terrorist attacks
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he terrorist attacks at Brussels Airport on 22 March had a huge impact, but the airport is recovering and getting back to its growth path. There was little disruption to freighters, which were only stopped for 24 hours before getting back to normal, but bellyhold cargo took a significant hit. The gateway’s head of cargo, Steven Polmans (pictured) explains: “On 22 March, we had the attack, which had a dramatic effect on our traffic for a few weeks. As of May however, we see again growth in our cargo volumes compared to last year, so very difficult to compare to our expectations and targets. “All together, after two years of very solid growth, we do want to grow again this year. Despite the difficult start we encountered, we are confident we will manage to get this result.” The first four months of 2016, Brussels handled 148,491 tonnes, down on the 161,221 tonnes for the same period in 2015, a 7.9 per cent fall with bellyhold traffic down 16.6 per cent. Polmans says bellyhold will take time to recover from the attacks and he is not expecting growth for now, but once airlines and passengers see things are back to normal, this will pick up. On the freighter side, he is more optimistic: “Freighter business is doing good, with more routes and airlines expected. We would like to add at least one additional full cargo carrier to our customer base and open some additional frequencies and new routes this year. For the moment we are confident this will materialise as planned.” A major boost came with the return of Ethiopian Cargo and Polmans welcomed the carrier back with open arms: “Ethiopian is very important to us, and since the restart early April, they already managed to become our largest cargo carrier. “Not only because we can continue our growth and show our expertise when it comes to flower handling, but also as it helps our forwarders to strengthen their BRUcargo operation and setup. The support of the forwarders has been crucial and very important in the decision for Ethiopian to return to Brussels.” He says the buoyant trade lanes are imports and exports to South East Asia, exports to Africa and imports from North America. Since the beginning of 2016, a new application in its cloud community platform, giving detailed and valuable data on all trade lanes, the evolution and commodities is helping business. Polmans says it has given more transparency and knowledge, helping it further strengthen its growth. He notes: “We see growth in most segments, but especially the perishables business on the import side and the pharma on export side are performing far above average. As both of them are key in our strategy, we will continue to focus on them without ignoring all the rest.” Meanwhile, the Air Cargo Belgium organisation launched on 19 April has made strides and Polmans says it has created 11 working groups from e-freight and pharma to security and training, noting: “In all these fields we will work together with all stakeholders to set up, modify or implement procedures or initiatives. The enthusiasm of all participants has given the
organisation already a head start, so the expectations are high.” But the European market is a concern for Polmans, as he says in the last few years it has been struggling to show some sustainable and long-term growth and figures are flat or even negative, noting every good month is followed by two bad months. He observes: “That is an issue for all of us in Europe and makes
us all fight harder for the same size of market. Belgium is keeping up, partially thanks to the good location in the economical heart, the so-called blue banana, in Europe. But the economical state of Europe is and should be a concern to all of us.” The biggest challenge is finding a good balance and maximising the benefits of being a passenger and freighter airport and another issue is the environment. Polmans says environmental awareness is high all over Europe and this will “not go away”. In the rest of 2016, the target is to continue growth, despite the Q1 results, but other projects are running. Polmans says: “We continue to invest in real estate, both on the first line and second line. The new sorting facility of DHL being erected is a good example. On pharma we are not sitting still. Together with the community, we are taking further initiatives and implementing new things such as our cool dolly. “This year we will get our cloud platform very visible, up and running for all stakeholders, when later this year our first applications will go live. This will be the start of our digitalisation program we started two years ago and will be key in reshaping how we work and in our industry. I am convinced in future, when looking back, this will be one of the big accomplishments in transforming the way we handle cargo at the airport.”
April figures reflect attacks
BRUSSELS Airlines’ cargo figures in April were heavily affected by the terrorist attacks at Brussels Airport on 22 March. In April, freight tonne kilometres were 15,343 million, an 11.4 per cent fall on the 17,324 million in April 2015. The freight load factor was also hit and down by 15 percentage points to 65 per cent compared to 80 per cent int the same month last year. Its home base Brussels Airport, was closed for bellyhold traffic for 12 days after 22 March. Since then, Brussels Airlines has rebuilt its flight offer from Brussels Airport, while reducing flights from the regional airports it had switched to. By the end of April, Brussels Airlines was operating around 85 per cent of its flight program.
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UK
American remains positive despite flat start to 2016
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merican Airlines Cargo is remaining positive despite volumes remaining virtually flat in the first quarter of 2016, regional cargo sales manager for Northern Europe, Andy Cornwell tells Air Cargo Week (ACW). Cornwell explains though volumes increased 15 per cent in 2015, helped by the integration of US Airways, declining yields for general cargo brought down revenue, though premium products were better. “We did however have a good year with our premium products in 2015, which was greatly assisted with our launch of e1 and e2 temperature controlled units carrying healthcare products.” He says though 2016 has been challenging so far, it is hard to compare directly with 2015 due to the US West Coast seaport strike giving airfreight an artificial boost.
Cornwell says: “The ‘challenging times’ theme has continued into 2016 from a revenue perspective. Volumes are virtually flat first quarter YOY, although this should be viewed positively against the context of the port strikes last year inflating 2015 first quarter volumes.” Cornwell says he does not expect a recovery in volumes soon, while overcapacity will remain a problem, but American will focus on premium products such as pharma, aerospace and perishables. “With capacity looking set to continue outpacing demand for the foreseeable, we continue to focus on market share and staying ahead of the competition, leveraging service excellence and value added to grow our business.” American handles a large percentage of perishables at Heathrow Airport, as products such as fresh salmon remain very popular in the US. Cornwell tells ACW: “The appetite of the Amer-
icans to consume fresh Salmon continues and this is a commodity we have been able to leverage our [Boeing] 777-300 aircraft to increase volumes to the west coast, with us able to uplift more than 35,000k on a full passenger flight.” Cornwell says Los Angeles is probably the best performing US destination from the UK, because of strong demand and other carriers using less cargo friendly aircraft. “We carry a lot of seafood, flowers and car parts to the West coast and have a twice daily service using the 777-300 aircraft meaning we have a good back up ‘same day’ service which gives customers assurances that we can meet their requirements.” American has handled all sorts of products from Heathrow, from moving rally cars to Argentina, band equipment for numerous artists, aero engine parts and pharmaceuticals. Cornwell says he hopes American will increase its pharma business now it is authorised to use e1 and e2 electronic temperature controlled units from partners, C-Safe and Envirotainer. He says American can move a lot of pharma to
its state-of-the-art temperature controlled facility in Philadelphia, which is served directly from Heathrow, Manchester and Dublin, as well as other destinations across the network. The UK is Europe’s strongest performing economy at the moment, presenting good opportunities. Cornwell comments: “The UK has the best performing economy in Europe at present, so there are certainly opportunities. The strength of the dollar should continue to encourage British exports, although as I collect revenues in pounds but report and are measured in dollars, it does little for my revenue plan aspirations.”
Virgin and Delta strengthen ties
Delta Air Lines and Virgin Atlantic are to strengthen their UK – US networks by sharing flights, which will include the first London – Portland service. From the summer of 2017, the two airlines will optimise their joint network, which they say will offer customers more choice and flexibility. The changes for Delta will include four times a week Heathrow – Portland flights from 26 May 2017, adding a second Heathrow – Detroit flight from 26 March, replacing Virgin’s daily service, and a third Heathrow – Atlanta frequency, taking over from Virgin’s second daily flight from 25 May. From 26 March, Virgin will take over Delta’s daily Heathrow – Seattle service and Delta’s daily Manchester – New York John F. Kennedy (JFK) flight from 25 May. Delta will resume Manchester – JFK services from winter 2017.
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Virgin Atlantic Cargo senior vice president, John Lloyd (pictured) says Seattle is a very important market for UK – US trade, while increasing services from Manchester will be beneficial to customers in the North of England and Scotland. He says: “By increasing our commitment to Manchester, we will also be reducing the need for customers in the North of England and Scotland to have to truck cargo to London, which is going to save them time and money.” Delta senior vice president trans-Atlantic, Dwight James says: “Adding a brand new service to Portland while increasing the scale of Delta’s reach across our Atlanta and Detroit hubs provides a comprehensive network of nonstop and connecting destinations for both Delta and Virgin customers.” The joint services from 26 March 2017 will offer 42 daily nonstop flights between the US and UK, of which 28 will be from Heathrow and 14 between Manchester, Glasgow, Belfast, London Gatwick and Edinburgh to the US.
UK
Luxury cars drive growth at Manchester Airport
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anchester Airport (pictured) has seen cargo volumes pass the 100,000 tonne mark again during the 2015/16 financial year, with valuable products such as luxury cars helping drive the growth. During the year, Manchester handled 103,437 tonnes of cargo, the first time since 2011/12 that the figure has been above 100,000. Manchester Airport handled £6 billion ($8.7 billion) of trade during the financial year. Of that figure, more than 50,000 tonnes went to the Middle Eastern locations of Dubai, Abu Dhabi or Qatar. Among the interesting items were luxury cars including Lamborghinis, Bentleys and a Jensen Interceptor, transported by Emirates. Emirates also transported a one-off Speedback GT built by David Brown Automotive, worth £500,000 from Manchester to Dubai for an event at the Dubai World Trade Centre in November. Manchester Airports Group business development manager – cargo and general aviation, Conan Busby (pictured) says: “With our World Freight Terminal, which is 30 years old this year, and our expanding Airport City global logistics hub, we are well placed to serve any type of cargo need for a whole range of products or customers. “As this year progresses we predict this increase will continue and the main trends will be further growth in the e-commerce industry with China and the Middle East being huge growth markets.” Manchester Airport chief executive officer, Ken O’Toole says many of Manchester’s routes are unavailable elsewhere outside of London. “This underlines the airport’s role as an key enabler of growth and we expect the launch of more long haul new services to the likes of Beijing, Los Angeles, Boston and San Francisco to drive up export volumes in the coming months and years.” Emirates has also been using Manchester for transporting foodstuff, including Welsh coast crabs destined for China, as well
as UK food for expats based in the United Arab Emirates. Dubai was Manchester’s top performing freight route, handling 21,661 tonnes, followed by Abu Dhabi at 16,901 tonnes and Doha at 13,318 tonnes. During the year, Etihad Airways increased capacity by upgrading services from an Airbus A330 to a Boeing 777-300ER.
Asian volumes have also been on the rise, helped by Cathay Pacific starting Manchester – Hong Kong services in December 2014, which has resulted in 6,000 tonnes of cargo so far. E-commerce is an increasingly popular export to Asia, because of the popularity of companies such as Amazon Prime, Alibaba and Net-a-Porter.
Manston saga continues
US investment firm, RiverOak Investment Corp has assembled a professional team as it continues its quest to purchase and reopen the defunct Manston Airport (pictured). Manston Airport closed on 15 May 2014, and since then there has been a strong local campaign to reopen it. RiverOak has been trying to convince the local council, Thanet District Council, that it is a suitable indemnity partner for a compulsory purchase order for the site. In December 2015, RiverOak announced it would use a development consent order (DCO) to take control of the site. On 31 May this year, RiverOak completed appointing a professional team to help it pursue the DCO. RiverOak Investment Corp chief investment officer, George Yerrall says: “Manston has a strong case to be considered a Nationally Significant Infrastructure Project as it offers much-needed runway capacity in the South East of England and is a resource that should be working hard on behalf of the country, not simply left derelict to be bulldozed for housing and light industrial use that is already well provided for in the local area.” The professional team will be led by law firm, Bircham Dyson Bell, which specialises in gaining consent for nationally significant infrastructure projects. The team will include airport planning specialist, RPS, Mouchel, for land referencing services, and Amec Foster Wheeler will have overall responsibility for the project through its Southern Environmental Assessment Team. RiverOak plans to use Manston as a major freight hub, a reliever for other London airports, establish an aircraft recycling and engineering facility, a flight training school, as well as a base for at least one passenger carrier, and a fixed base operation for executive travel.
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CARGO GATEWAY SINGAPORE Changi Airport set to see express and e-commerce cargo grow
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ustralia, China and Hong Kong are the top three performing air cargo markets at Changi Airport in the first four months of 2016. Changi Airport Group (CAG) senior manager in the cargo and logistics development division, Phau Hui Hoon explains in the period, cargo shipments increased 4.3 per cent to reach 629,670 tonnes, compared to the same period last year, noting: “The growth is attributed to the surge in transshipment volumes, outweighing a decline in exports and imports.” Hui Hoon says perishables are an important cargo segment to Changi, contributing to 13 per cent of total cargo throughput, while in 2015; perishable volumes grew 8.4 per cent year-on-year, mainly driven by strong growth in imports and transshipments. She also explains there is a pharmaceuticals focus: “Changi continues to ramp up its efforts to strengthen pharmaceutical handling capabilities with the pursuit of the IATA CEIV Pharma certification.” As industry conditions remain weak, CAG has rolled out a package of support measures totaling $14 million Singapore ($10
million) for its cargo partners, which include a one-time special assistance package (SAP) for cargo agents and the extension of a landing fee rebate for scheduled freighter flights for a year from 1 April 2016. Hui Hoon says the hub hopes that this will provide the sector with cost relief and serve as a source of optimism in light of the slowdown.
But what is the biggest operating challenge for Changi? “One of the key challenges in the air cargo industry is the management of cargo capacity. In recent years, to fulfill passenger demand, there has been a large injection of passenger flights leading to the addition of significant belly capacity. This has in turn led to an oversupply of capacity on certain trade lanes,” Hui Hoon says. The gateway expects to welcome more bellyhold routes to its network compared to freighter routes, but one all-cargo success story has been AirBridgeCargo Airlines - which launched a route into Changi in September 2015 and after six months started welcoming a third weekly service. Hui Hoon notes: “Through AirBridgeCargo’s Moscow hub, Singapore is directly connected to major European cargo gateways including Frankfurt, Paris, Amsterdam and Milan as well as to US freight markets served by ABC’s international route network.” Infrastructure will be expanded and CAG and DHL Express are to build a 24-hour express facility at the Changi Airfreight Centre that will be completed later this year to support the express cargo segment. Hui Hoon says this will increase DHL’s throughput by three times and processing speed by six times, and further anchors Changi’s position as a key cargo and logistics hub in the region. SATS is also investing in an e-commerce Hub at Changi with Singapore Post (SingPost) as its anchor customer and the new facility will improve efficiency and space utilisation, and enhance the consignment handling capabilities for both SATS and SingPost. Hui Hoon adds: “SATS will be the first ground handler in the world to own such an airside facility. The expected completion date is end of the year.” As for the future, cargo is set to get a boost as Runway 3 at Changi, now used by the military will be extended from 2.75km to 4km and converted to a joint civil-military use and the extended runway will be able to handle larger commercial aircraft. Hui Hoon says: “At the same time, as part of the Changi East development, which involves the development of a new Terminal 5, Changi is developing a three-runway system to connect Runway 3 to Changi’s current airfield. “Scheduled for completion in early 2020s, the three-runway system will allow Changi to handle more flights, particularly during the morning and evening peak hours, which are preferred for express operations and will further reinforce Changi as a major express air cargo hub in the region.”
SIA sees cargo profit fall
SINGAPORE AIRLINES (SIA) GROUP reported net profit of $804.4 million Singapore dollars ($568.7 million) in the year ending 31 March, more than doubling its $367.9 million Singapore dollar net profit in the previous year, despite cargo losses increasing. The airline puts the better figures down to a combination of higher revenue from subsidiary airlines, income from the release of seven Airbus A350-900 delivery slots, and lower net fuel cost. SIA Group is parent to Singapore Airlines, SIA Cargo, Tigerair, Scoot, SilkAir and SIA Engineering. SIA Cargo saw an operating loss of $50 million Singapore for the 2015/16 fiscal year, up on the operating loss of $22 million Singapore for the previous year. Singapore Airlines reported an operating profit of $485 million Singapore, up 42.6 per cent from fiscal year 2014/15. Tigerair reported an operating profit of $14 million Singapore - reversed from a loss of $9 million Singapore in the previous year. Full-service subsidiary SilkAir saw a jump in operating profits to $91 million Singapore, up from $41 million Singapore the year before.
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USA
ACW 6 JUNE 2016
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NEWSWEEK US capacity increased by Qatar Airways Cargo with Atlanta service
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atar Airways Cargo has increased its capacity to Atlanta (US) with the launch of daily bellyhold flights to Atlanta on 1 June 2016. The world’s third largest international cargo carrier has served Atlanta with Boeing 777 freighters for almost five years. The introduction of daily widebody Boeing 777 passenger flights provides additional bellyhold capacity to Qatar’s existing four times weekly freighter services between Doha and Atlanta. The carrier now offers a combined 744 tonnes of capacity per week on its Doha-Atlanta-Doha route, which it says meets the robust demand of the destination. Qatar Airways Cargo currently operates dedicated freighters to six
destinations in the Americas: Atlanta, Chicago, Dallas/Fort Worth, Houston, Los Angeles and Mexico City; as well as bellyhold cargo space to 13 hubs in the Americas. Qatar Airways chief officer for cargo, Ulrich Ogiermann (pictured) says: “There is enormous potential for growth in the Americas, as our rapid expansion in this market indicates. “We started freighter services to Atlanta in
November 2011, and we are excited to now launch passenger flights giving us extra cargo capacity into the world’s busiest airport. “Our customers now have access to more capacity in addition to a network of more than 150 destinations via our state-of-the-art hub in Doha as well as innovative solutions for their cargo.” Qatar Airways Cargo’s portfolio of products
includes QR Pharma, QR Fresh and QR Equine, QR Charter, and the recently launched QR Express. The carrier serves more than 50 freighter destinations worldwide and also delivers freight to more than 150 destinations globally on 185 aircraft, while the Qatari airline’s freighter fleet now includes eight Airbus A330s, nine 777s and two 747-400s.
More US routes for Aer Lingus AER LINGUS has celebrated its 80th anniversary by starting three new bellyhold US routes to Los Angeles, Newark and Hartford. Los Angeles began on 4 May, but Newark in New Jersey will commence on 1 September and to Hartford in Connecticut on 28 September. Aer Lingus chief executive officer, Stephen Kavanagh says: “We are delighted to celebrate 80 years of flying at Aer Lingus. 2016 has been a very exciting year for Aer Lingus so far – we recently commenced our new Los Angeles service and in September our Newark, New Jersey and Hartford, Connecticut services will commence. “These new routes open up new tourism and business opportunities with improved connectivity through our Dublin Gateway. “We are proud of our 80 year history of connecting Ireland to the world and will continue to fly the shamrock high for the next 80 years.” Aer Lingus was taken over by the International Airlines Group (IAG) in August 2015, as part of a 1.4 billion euro ($1.5 billion) deal and opened up new cargo markets, as it is now part of the IAG Cargo network covering British Airways, Iberia, and partnerships with other global carriers.
Hong Kong freighter for Emirates
EMIRATES SKYCARGO has launched weekly Hong Kong – Delhi – Dubai Boeing 777 Freighter services on 1 June. The airline is expecting key exports from Hong Kong to Delhi will include pharmaceutical raw materials, electronics and machinery. Key exports from Delhi, which will have access to 150 global destinations via Dubai, will include leather goods, garments, pharmaceuticals and perishables. The Delhi service will complement Emirates SkyCargo’s twice weekly Shanghai – Mumbai – Dubai flights and 18 services from Hong Kong and Dubai. The 777F flight will have 100 tonnes of capacity. Flight number EK 9219 will leave Hong Kong on Wednesday at 21.35h and arrive in Delhi on Thursday at 00.45h, before leaving at 03.15h and landing in Dubai at 05.20h.
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