Payload Asia | February 2020

MCI (P) 002/07/2016 ISSN 2010-4227

The Trade Magazine for the Asia-Pacific & Middle East Regions Vol. 36, No. 02/ Febuary 2020

Turbulence time at Hong Kong air cargo 2019 worst year for air freight demand since 2009 Cross-border opportunities

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Vol. 36, No. 02, Febuary 2020

COVID-19 cuts demand & revenues

IATA announced that its initial assessment of the impact of the Novel Coronavirus 2019 outbreak (COVID-19) shows a potential 13% full-year loss of passenger demand for carriers in the AsiaPacific region. Considering that growth for the region’s airlines was forecast to be 4.8%, the net impact will be an 8.2% full-year contraction compared to 2019 demand levels. In this scenario, that would translate into a $27.8 billion revenue loss in 2020 for carriers in the Asia-Pacific region—the bulk of which would be borne by carriers registered in China, with $12.8 billion lost in the China domestic market alone.

Publisher K.Dass Editor-In-Chief/Publisher Email: editorial@harvest-info.com Tel: +65 6828 9333 EDITORIAL Yi An Ang Editorial Assistant Email: angyian1998@gmail.com Tel: +65 6828 9333 Alison Yeo Editorial Assistant Email: design@harvest-info.com Tel: +65 6828 9333 DESIGN Samantha Tham Graphic Designer Email: samanthatkq@gmail.com Tel: +65 6828 9333 SALES REPRESENTATIVES Asia/Japan Katsuya Watanabe Tel: +81 90 5321 6881 Fax: +81 3 6823 8994 E-mail: kwatanab@crocus.ne.jp South Korea Kwangsok Hong Tel: +070 8880 1745 Mobile: +010 9886 0729 Email: kshong2000@nate.com North America Matt Weidner Tel: +1 610 486 6525 Fax: +1 610 486 6527 Email: mtw@weidcom.com

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www.payloadasia.com | Febuary 2020

K. Dass, Editor-In-Chief

In the same scenario, carriers outside Asia-Pacific are forecast to bear a revenue loss of $1.5 billion, assuming the loss of demand is limited to markets linked to China. This would bring total global lost revenue to $29.3 billion (5% lower passenger revenues compared to what IATA forecast in December) and represent a 4.7% hit to global demand. In December, IATA forecast global RPK growth of 4.1%, so this loss would more than eliminate expected growth this year, resulting in a 0.6% global contraction in passenger demand for 2020.

These estimates are based on a scenario where COVID-19 has a similar V-shaped impact on demand as was experienced during SARS. That was characterized by a six-month period with a sharp decline followed by an equally quick recovery. In 2003, SARS was responsible for the 5.1% fall in the RPKs carried by Asia-Pacific airlines.

As the editor of Payload Asia I have the share the above truth with you even though it sounds negative.

Let me also sight some positive things that are happening at the same time: A) Munich Airport and the Vietnamese airline Bamboo Airways have signed a memorandum of understanding (MoU) stating their joint intention to intensify their cooperation. Bamboo Airways plans to launch non-stop services from Hanoi and Ho Chi Minh City to Munich in July 2020.

B) Kazakhstan low-cost airline FlyArystan is pleased to announce the start of sales for 8 new routes from its new aircraft base in Karaganda. Starting April 20 of this year, the sixth FlyArystan aircraft will join the fleet of the fast growing Kazakh low cost carrier and will become the first one based at the Sary-Arka International Airport, Karaganda.

C) Businesses moving £20 billion of trade between the UK and India each year will enjoy a direct link to and from the North of England from October 2020 when Virgin Atlantic Cargo launches new Manchester-Delhi services. The route will see Virgin Atlantic fly to Delhi from Manchester for the first time. Starting on 26 October, the airline will operate three A330-200 flights every Monday, Thursday and Saturday as part of its growing commitment to the Indian market.

D) The Saudi Arabian Logistics (SAL) Co. has inaugurated its new 37,800sq meter air cargo facility at the Dammam-based King Fahad International Airport. The state-of-the-art facility offers advanced logistic services and boasts spacious facilities for dangerous goods, radioactive substances and cargo in-transit areas as well as designated areas for shipping live animals, heavy-weight shipments and a 24/7 customer service office.

I’m sure there are many more such prospect happening around the industry amidst the virus outbreak. Let’s not embrace the virus and hold back your plans and opportunities.

Let’s fight it by embracing the opportunities ahead!

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All correspondence should be made to design@harvest-info.com or editorial@harvest-info.com from 30 May 2019. You could also reach us at +65 68289333.

1

Content Page GATEWAYS

04-07

COVER STORY Turbulence time at Hong Kong air cargo

08

IATA

2

09-11

FEATURE - AIRLINE Saudia Cargo sponsors Saudi International Golf Tournament

12

FEATURE - AIRLINE Facial recognition technology throughout the passenger journey

13

FEATURE - AIRLINE Etihad Cargo renews WFS Global handling framework

14

FEATURE - AIRLINE Global Air Cargo down 4% at start of 2020 as industry awaits impact of coronavirus

15

FOCUS ‘Book it Right and Pack it Tight’

16

FEATURE - LOGISTICS FedEx supports transportation of medical supplies in urgent needs

17

FEATURE - LOGISTICS Cross-border opportunities

18

FEATURE - LOGISTICS The On-Board-Courier The core of Samedaylogistics

19

FEATURE How to Communicate during Covid-19 Disruptions

20

FEATURE FedEx Earns No. 14 Spot on the FORTUNE World’s Most Admired Companies List

21

FEATURE Shipping Market to Pick Up in 2020

22-23

FEATURE GEODIS develops time definite road freight service across Southeast Asia

24

APPOINTMENT

25-26

TRENDS

27-28

LOGISTICS

29

EXPRESS & MAIL

30

08 13 19 22 29 PAYLOAD ASIA | Febuary 2020

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GATEW AYS

ASIA

Zebra Technologies works with Singapore Polytechnic to groom skilled talents

Three-year MOU prepares Singapore students for Advanced Manufacturing era through industry-relevant and experiential learning.

Zebra Technologies Corporation (ZBRA), an innovator at the edge of the enterprise with solutions and partners that enable businesses to gain a performance edge, announced the signing of a three-year Memorandum of Understanding (MOU) with Singapore Polytechnic.

The MOU outlines both parties’ intention to work as part of the Singapore Polytechnic Advanced Manufacturing Partners Network, which serves to benefit more than 240 Singapore Polytechnic students with a Diploma in Electrical & Electronic Engineering and Diploma in Computer Engineering.

The Singapore Polytechnic Advanced Manufacturing Partners Network seeks to build a growing and sustainable ecosystem of like-minded industry leaders like Zebra Technologies, to achieve its vision of supporting Singapore’s Advanced Manufacturing initiatives.

The collaboration between Zebra Technologies and Singapore Polytechnic w ill t ake pl ace ac ro ss multiple fronts, including; student-internship

4

opportunities, co-development of Industry 4.0 projects and solutions that will benefit local enterprises, showcasing of Advanced Manufacturing solutions and possibilities with learning factories, co-developing curriculum related to Advanced Manufacturing, and promoting Advanced Manufacturingrelated engineering education and careers to current and future students.

locations. Qingdao joins TT Club’s management company Thomas Miller’s offices in Shanghai and its Asia-Pacific headquarters in Hong Kong.

Ivy Yu will lead the Ever Faith team in serving TT Club Members. Ivy spent four years working at the offices of TT Club managers Thomas Miller in Shanghai and will bring valuable experience of mutual insurance to the new Network Partner.

AMERICA

TT Club appoints network partner in Qingdao, China

International freight and logistics insurer, TT Club has announced the appointment of a new Network Partner, tasked with providing support for those the Club insures around the world, in Qingdao, China.

Fundamental to the mutual insurer’s service is its global reach. Therefore to have the first Network Partner established in China, to complement the existing Shanghai corporate office, is an important landmark for the Club.

Allowing TT Club Members, its insured, to access a unique network of freight transport experts across the globe, Network Partners provide claims assistance, loss prevention and risk management advice to container lines, freight forwarders and other supply chain operators who arrange their insurance cover through TT Club.

Now in Qingdao, through the appointment of Ever Faith Marine Service Co Ltd., as of 10th January, TT Club has a presence in three key

Pratt & Whitney GTF engines power Air Canada Airbus A220

Air Canada, founded in 1937, has on order 45 GTF-powered A220 aircraft. The airline currently operates 12 767 aircraft powered by the Pratt & Whitney PW4000 engine.

Pratt & Whitney, a division of United Technologies Corp. (UTX), along with Airbus and Air Canada celebrated the entry into service of Air Canada’s first A220 aircraft powered by Pratt & Whitney GTF engines. The event was commemorated with a ceremony at Air Canada’s headquarters in Montreal with Air Canada, Airbus, Pratt & Whitney and government representatives in attendance.

This entry into service marks a significant milestone for Air Canada as it becomes the first Canada-based A220 operator. Final assembly of Pratt & Whitney’s PW1500G engines, which power the A220 aircraft, is completed in Canada.

“Today is a special day, and one that adds to the rich history between Pratt & Whitney and Air Canada. The entry into service of the airline’s first A220 aircraft represents an opportunity to expand route networks and the ability to offer passengers a quieter and more comfortable flight experience,” said Rick Deurloo, chief commercial officer at Pratt & Whitney.

“We remain committed to supporting aviation growth in Canada and have been proud to work with Air Canada since their

PAYLOAD ASIA | Febuary 2020

GATEW AYS innovative technologies that go beyond what has been done before.”

AkzoNobel is a global leader in aerospace coatings, supplying high performance products and technologies for aircraft worldwide.

Pratt & Whitney inception more than 80 years ago.”

G TF Eng i ne s The A220, exclusively powered by the GTF engine, offers double-digit to power Wizz improvement in operating costs compared to current generation aircraft. It’s 20% more fuel efficient and provides a 75% reduction Air 166 Airbus in noise footprint and NOx emissions 50% below the ICAO CAEP 6 regulation.

A320neo family A k z o N o b e l ’s aircraft The order consists of 90 aircraft from Air’s 2016 selection, an additional s u s t a i n a b l e Wizz 56 Airbus A320neo family aircraft and 20 Airbus A321XLR aircraft.

Pratt & Whitney, a division of United primer qualified Technologies Corp. (UTX), and Wizz Air Hungary Ltd. (Wizz Air) announced

by Boeing selection of the Pratt & Whitney GTF Aerodur 2111 is used in combination with AkzoNobel’s qualified and market leading basecoat/clearcoat system and offers outstanding adhesion and in-service performance.

A chromate-free exterior primer developed by AkzoNobel’s Aerospace Coatings business has been newly qualified by aircraft manufacturer Boeing – underlining the company’s ongoing drive to make the aerospace industry more sustainable.

Aerodur 2111 is used in combination with AkzoNobel’s qualified and market leading basecoat/clearcoat system and offers outstanding adhesion and in-service performance. Now qualified under Boeing’s specification, the product creates the most sustainable exterior coating system for Boeing aircraft, potentially doubling the life of the paint job.

“This is another great example of putting the needs of the customer at the heart of our product development,” explains John Griffin, the company’s Managing Director for Aerospace Coatings. “It’s a compelling combination of sustainable innovation and customer focus which highlights our commitment to going beyond expectations.

“Aerodur 2111 perfectly illustrates how we’re continually looking to develop www.payloadasia.com | Febuary 2020

engine to power an order of 166 Airbus A320neo family aircraft.

This brings Wizz Air’s combined total order to 276 GTF-powered A320neo family aircraft. Pratt & Whitney will also provide Wizz Air with engine maintenance through a long-term EngineWise Comprehensive service agreement.

Wizz Air, the largest low-cost airline in Central and Eastern Europe and an affiliate of Indigo Partners, will be one of the largest A320neo family aircraft operators in Europe. Wizz Air currently operates a fleet of 113 V2500-powered A320ceo family aircraft and seven GTF-powered A321neo aircraft, and has been exclusively powered by Pratt & Whitney engines since its founding in 2003.

Since entering into service in early 2016, the GTF engine has demonstrated its promised ability to reduce fuel burn by 16

percent, to reduce nitrogen oxide emissions by 50 percent compared to the regulatory standard, and to reduce the noise footprint by 75 percent.

EUROPE & CIS

25by2025 gains momentum with 59 airlines joining the campaign

Collectively the 59 airlines that have currently committed to 25by2025 represent 30.24% of passenger traffic, covering both traditional and low-cost airlines.

The International Air Transport Association (IATA) announced that 59 airlines have committed to the 25by2025 campaign which seeks to address gender balance in civil aviation.

The 25by2025 campaign was launched on 26 September 2019 with participating airlines making a voluntary commitment to: • Increase the number of women in senior positions (to be defined by the member airlines) by either 25% against currently reported metrics or to a minimum representation of 25% by 2025 • Increase the number of women in under-represented jobs (e.g., pilots and operations) by either 25% against currently reported metrics or to a minimum representation of 25% by 2025 • Report annually on key diversity metrics Collectively the 59 airlines that have currently committed to 25by2025 represent 30.24% of passenger traffic, covering both traditional and low-cost airlines.

The initiative has resonated around the globe, with signatories coming from all continents; Europe (36), followed by AsiaPacific (10), the Americas (7) and Africa & Middle East (6).

The next phase of the campaign will focus on collecting data on the key areas signatories have committed to: the number of women in senior positions (as defined by the airline), the number of women in underrepresented areas within the airline 5

GATEW AYS (e.g., Pilots, Maintenance & Engineering), and the number of nominations and appointments to IATA governance groups.

IATA is also measuring and reporting on the number of women in senior positions, and the number of women represented in industry meetings. The findings will be shared during IATA’s Annual General Meeting and Air Transport Summit in Amsterdam in June 2020.

Liege Airport sets new record Liege Airport, 7th cargo airport in Europe and 1st in Belgium, is the only European airport that prioritises full cargo. It specialises in express transport, electronic commerce, pharmaceutical products and perishable goods, as well as live animals.

Despite a global economic slowdown, Liege Airport has achieved a new record with over 900,000 tonnes of goods transported in 2019.

Liege Airport continues to develop, with a new record of 902.480 tonnes (+3.6%) of transported goods compared with 870.644 tonnes in 2018.

The activity of the air cargo sector slowed globally in 2019. Brexit and the trade war between China and the United States considerably influenced world trade and, as a result, the transport of goods.

Passenger activity remained stable with 170,737 passengers passing through the airport.

Liege Airport, 7th cargo airport in Europe and 1st in Belgium, is the only European airport that prioritises full cargo (#freightersfirst). It specialises in express transport, electronic commerce, pharmaceutical products and perishable goods, as well as live animals. Liege Airport, and its brand Flexpress, is operational 24/7 without restrictions, offering a flexible and fast service, all less than a day’s journey by truck to the heart of the AmsterdamParis-Frankfurt golden triangle with its 400 million consumers.

6

FlyArystan sold more than 1,000,000 seats

Low-cost airline FlyArystan is a division of Air Astana, based in Almaty and awarded the rating of 4-star airline for the quality of service.

FlyArystan is happy to announce that it has now sold more than 1,000,000 seats across the low cost airline’s route network in less than 9 months of airline operations.

Nearly half (47%) of the seats were sold at a price below 10,000 tenge for a one-way flight. Of the total number of seats sold, more than 80% have already made their flight with FlyArystan, with the remainder planning to do so in the near future.

FlyArystan, the first domestic low cost carrier in Kazakhstan currently operates a fleet of 4 Airbus A320 aircraft. In the second quarter of this year that is expected to increase to 7 A320 aircraft. In addition a further 3 aircraft are expected to join the fleet before the end of 2020 making for a total FlyArystan fleet at the end of 2020 of 10 aircraft. Sales on 11 existing FlyArystan destinations are already open until October 25, 2020. Most recently, FlyArystan announced the start of sales on the Nur-Sultan-Aktobe-Nur-Sultan route with the cost of a one-way flight starting from 7999 tenge.

Low-cost airline FlyArystan is a division of Air Astana, based in Almaty and awarded the rating of 4-star airline for the quality of service, as well as the award “Best Airline in Central Asia and India” according to Skytrax World Airline Awards. By 2022, it is planned to increase the FlyArystan fleet to at least 15 aircraft. FlyArystan was recognized as “The Best Deal of the Year” according to the Kazakhstan Growth Forum 2019.

Ade Adepitan reveals winners of UK freight i n d u s t r y ‘Oscars’

During this year’s Awards luncheon, Adepitan delivered a motivating speech, which gave some clear insight into how challenges need to be overcome if success is to be achieved.

Ade Adepitan, one of the UK’s most well-known Paralympians and broadcasters has revealed the winners of the British International Freight Association’s Freight Service Awards 2019.

At a glittering awards ceremony, host Adepitan announced eight winners from the 33 freight forwarding companies that were shortlisted as finalists, as well as three individual award winners.

The winners of the eight General, Modal, and Specialist categories in the Awards, which has established a benchmark of quality for the British freight forwarding industry for more than a quarter of the century, are: Brunel Air Cargo Services, Core Management Logistics Ltd, Davies Turner, Morgan Cargo, Noatum Logistics, Spatial Global, Westbound Logistics and Zencargo.

In the Individual categories, the winner of the Young Freight Forwarder Award is Jenna Morgan of Wallis Shipping. In the Apprentice of the Year category, which was first introduced in the 2018 awards, the judges declared Thomas Frost of Geodis Freight Forwarding and Jack Reddington of Hemisphere Freight Services as joint winners.

Once again, BIFA President Sir Peter Bottomley MP welcomed guests to the luncheon ceremony, which was attended by almost 550 people, and – along with Adepitan – presented all the finalists with their certificates.

The finalists and winners in the ten categories were as follows: General categories The Project Forwarding Award – sponsored by Peter Lole Insurance Brokers Winner - Spatial Global Finalists – Moto Freight, OIA Global, Pentagon Freight The Specialist Services Award – sponsored by Forward Computers Winner: Morgan Cargo Finalists – Asap Cargo, Regional Express, Tigers Global Logistics The Staff Development Award – sponsored by Albacore Systems Winner: Core Management Logistics Finalists – Dachser, Morrison Freight, Unsworth PAYLOAD ASIA | Febuary 2020

GATEW AYS The Supply Chain Management Award – sponsored by BoxTop Technologies Winner: Zencargo Finalists – B&H Worldwide, Davies Turner, Unsworth Individual categories The Young Freight Forwarder Award – sponsored by Virgin Atlantic Cargo Winner: Jenna Morgan - Wallis Shipping Finalists – Jamie Abbott - Morrison Freight; Sophie Rye - Kerry Logistics; and, Mitchell West - DB Schenker The Apprentice of the Year Award sponsored by Seetec Outsource Joint Winners: Thomas Frost – Geodis Freight Forwarding, and Jack Reddington – Hemisphere Freight Services Finalists - Holly Herron – Dachser; and, Sarah Griffiths – DPD Group

Modal categories The Air Cargo Services Award – sponsored by IAG Cargo.

Winner: Noatum Logistics Finalists – Charles Kendall Freight, Dimerco Express, Evolution Forwarding, Metro Shipping European Logistics Award – sponsored

by TT Club Winner - Davies Turner Finalists - Nextday Freight, Noatum Logistics, Simpex Express The Ocean Services Award – sponsored

by Port Express Winner: Westbound Logistics Finalists – Spatial Global, Ucargo, Unsworth The Extra Mile Award – sponsored by Descartes.

Winner: Brunel Air Cargo Services Finalists – Hemisphere Freight Services,

Jordon, Ligentia Keen concluded with a thank you to all the award category sponsors, as well as the following organisations for their support of the BIFA Freight Service Awards.

Agency Sector Management (ASM) - Ceremony host sponsor American Airlines Cargo - Event sponsor CNS – sponsor of the multimedia presentation MCP plc – sponsor of the finalists’ certificates Menzies – sponsor of the AV relay monitors Simpex Express – sponsor of the ceremony tickets Wisetech Global – sponsor of the ceremony programme Woodland Group – sponsor of the winners’ trophies

Advertise With Us! For more infomation, email us at editorial@ harvest-info.com

www.payloadasia.com | Febuary 2020

7

C OVER S TORY

Turbulence time at Hong Kong air cargo

HKIA is the only airport with more than 100 international flight routes, making it an effective cargo transhipment hub for the Mainland. Today there is disruptions at the Hong Kong International Airport due to new tariff increases in the trade war between the U.S. and China.

Hong Kong was the world’s seventh largest trading economy in 2018, underpinned by its efficient transportation and logistics facilities among others. Hong Kong’s container ports was the world’s seventh busiest in 2018, albeit losing the top position since 2005 amid strong competitions from Mainland ports in terms of lower handling charges and improved port infrastructure.

Meanwhile, Hong Kong International Airport (HKIA) has been ranked as the world’s busiest for international cargo every year, notwithstanding its handling charges being considered as among the highest in the world.

According to a study on landing charges of selected airports in Asia, HKIA and Singapore Changi Airport (“SIN”) charged 1.4 times to 2.6 times higher than other airports in the study (Figure 2). Nevertheless, these two airports have remained the two busiest aviation hubs in the region, connecting much of Asia with the rest of the world.

Unlike the case of sea cargo, air cargo transportation competes more on efficient and prompt delivery than on freight charges. Goods transported by air tend to be of higher value and/ or time-sensitive, requiring additional security arrangements and better time management. Reflecting the high value nature of air cargo, HKIA handled 5.02 million tonnes of cargo or 1.8% of the total trade in volume terms in 2018, which amounted to HK$3,708.6 billion 8

or 41.8% of the total trade in value terms.

Connectivity of an airport is a critical factor for prompt delivery of air cargo, as direct flight can effectively shorten delivery time. Compared with other major airports in the GuangdongHong Kong Macao Greater Bay Area (“the Greater Bay Area”), HKIA is the only airport with more than 100 international flight routes, making it an effective cargo transhipment hub for the Mainland. Most recently, the opening of Hong Kong-Zhuhai-Macao Bridge should boost the transhipment hub status of HKIA, as the bridge shortens the transportation time between HKIA and Zhuhai from four hours to about 45 minutes.

The construction of the Three-Runway System and associated air cargo facilities should further strengthen the competitiveness of air cargo industry of Hong Kong. Yet, weak external demand amid softening global economic growth and US-Mainland trade tension has overshadowed the recent air cargo performance of HKIA. During the first nine months of 2019, the value of Hong Kong’s air cargo throughput declined by 4.8% over a year earlier.

However today, “Trade tensions are weighing heavily on the entire air cargo industry,” IATA’s Director General and CEO Alexandre de Juniac said in a statement. “Higher tariffs are disrupting not only transpacific supply chains but also worldwide trade lanes.”

If these trends continue then 2019 could be the first year since 2009 when the global air freight market contracts, IATA said. The Asia Pacific air cargo market has been hit especially hard by these declines as it makes up about 35% of global volume. Asia Pacific airlines are reporting FTKs 5.7% lower than a year earlier, according to IATA. Africa was one region that showed growth in July with international FTKs growing11.3% YoY as it increases trade with the other regions, including the Asia Pacific.

Air cargo carriers are beginning to feel the effects of sluggish demand. FedEx announced plans last week to retire or ground up to 37 planes after peak season in an attempt to better match capacity with demand. Executives on FedEx’s recent earnings call said manufacturing output has declined in Asia and Europe, weakening demand for air freight. FedEx expects this to continue into 2020.

UPS, meanwhile, said in July it is planning to increase its capacity. The air carrier said it had seen YoY growth in international air freight profit despite lower tonnage numbers, UPS CFO Richard Peretz said in July.

Early data from August 2019 suggests IATA is right about the trend continuing.

Cathay Pacific saw its cargo traffic decline 11.6% YoY in August, according to Air Cargo World. Cathay Pacific was impacted by multiple days of disruptions caused by protests at the Hong Kong International Airport in August.

PAYLOAD ASIA | Febuary 2020

2019 worst year for air freight demand since 2009

The International Air Transport Association (IATA) released full-year 2019 data for global air freight markets showing that demand, measured in freight tonne kilometers (FTKs), fell by 3.3% compared to 2018 while capacity (AFTK) rose by 2.1%. This was the first year of declining freight volumes since 2012, and the weakest performance since the global financial crisis in 2009 (when air freight markets contracted by 9.7%).

In the month of December, cargo volumes contracted 2.7% year-on-year while capacity rose 2.8%.

Air cargo’s performance in 2019 was dampened by weak growth in global trade of just 0.9%. The sector’s underperformance was also due in particular to slowing GDP growth in manufacturing-intensive economies.

Sof ter business and consumer confidence, along with falling export orders, also contributed to air freight struggles.

There are signs that confidence and orders could pick up in 2020.

It is too early to say what long-term effects will be seen from the impact of restrictions associated with combatting the coronavirus outbreak.

“Trade tensions are at the root of the worst year for air cargo since the end of the Global Financial Crisis in 2009. While these are easing, there is little relief in that good news as we are in unknown territory with respect to the eventual impact of the coronavirus on the global economy.

With all the restrictions being put in place, it will certainly be a drag on economic growth. And, for sure, 2020 will be another challenging year for the air cargo business,” said Alexandre de Juniac, IATA’s Director General and CEO.

Regional Performance All markets except Africa suffered volume declines in 2019. Asia-Pacific retained the largest share of FTKs, at 34.6%. The share of freight traffic increased modestly for both North America and Europe, to 24.2% and 23.7%, respectively. Middle East carriers’ traffic share held steady at 13%. Africa and Latin America saw their shares lift marginally, www.payloadasia.com | Febuary 2020

December 2019 (% yearon-year) Total Market Africa Asia Pacific Europe Latin America Middle East North America

World share1

FTK

AFTK

FLF (%- FLF pt)2 (level)3

100.0% 1.8% 34.6% 23.7% 2.8% 13.0% 24.2%

-2.7% 10.3% -3.5% -1.1% -5.3% -3.4% -3.4%

2.8% 10.0% 2.8% 4.9% -3.1% 1.9% 2.1%

-2.7% 0.1% -3.4% -3.2% -0.7% -2.6% -2.2%

46.7% 36.8% 51.9% 53.0% 30.0% 47.0% 39.5%

1 % of industry FTKs in 2019 2 Year-on-year change in load factor 3 Load factor level to 1.8% and 2.8%.

• A s i a - P a c i f i c c a r r i e r s i n December posted a decrease in demand of 3.5% compared to the same period a year earlier. Capacity increased by 2.8%.

The full-year 2019 saw volumes decline 5.7%, the largest decrease of any region, while capacity increased by 1.1%. As the world’s main manufacturing region, international trade tensions and the global growth slowdown weighed heavily on regional air freight volumes in 2019.

Within-Asia FTKs were particularly affected (down 8% compared to a year ago).

• North American airlines saw volumes fall by 3.4% in December, while capacity grew by 2.1%. For 2019 in total, the region’s cargo volumes declined by 1.5%, compared to a capacity increase of 1.6%. Trade tensions and cooling US economic activity in the latter part of the year have been factors in the decline. The 5.6% fall in international year-on-year volumes in December was the weakest monthly growth outcome for the region since early 2016.

• European airlines experienced a 1.1% year-on-year decrease in freight demand in December, with a capacity rise of 4.9%. The fall in December was typical of the performance for 2019 as a whole, where volumes fell 1.8%, but capacity increased by 3.4%. Softer activity, including in the manufacturing-intensive German economy, combined with ongoing Brexit uncertainty, contributed to the 2019 result, which in international freight volume terms was the weakest

since 2012.

• Middle Eastern carriers’ freight volumes decreased 3.4% year-on-year in December and capacity increased by just 1.9%, the lowest of any region. This contributed to an annual result of a decline in demand of 4.8% in 2019 – the second greatest decline in growth rate of all the regions. Annual capacity increased just 0.7%. Disruption to global supply chains and weak global trade, together with airline restructuring in the region, were the chief drivers of the weaker freight outcome.

• Latin American airlines suffered the sharpest fall in demand of any region in December, of 5.3%. The region was also the only one to see a reduction in capacity (-3.1%). Although the region was the second strongest performer across 2019 as a whole, limiting its decline in volumes to just 0.4%, social unrest and economic difficulties in several key countries led to the weakest international FTK outcome since 2015. Annual capacity increased 4.7%.

• African carriers’ saw freight demand increase by 10.3% in December 2019, compared to the same month in 2018. This was reflected in the strong 2019 full-year performance, which saw Africa freight volumes expand 7.4%.

Capacity in December grew by 10% and for 2019 in total, increased by 13.3%.

Over the year, air cargo volumes have been supported by strong capacity growth and investment linkages with Asia.

9

Slower but Steady Growth in 2019 The International Air Transport Association (IATA) announced fullyear global passenger traffic results for 2019 showing that demand (revenue passenger kilometers or RPKs) rose by 4.2% compared to the full year of 2018.

The 2019 result is a slowdown compared to 2018’s annual growth of 7.3% and marked the first year since the global financial crisis in 2009 with passenger demand below the long-term trend of around 5.5% annual growth.

Full-year 2019 capacity climbed 3.4%, and the load factor rose 0.7 percentage point to a record high of 82.6%. The previous high was 81.9% set in 2018.

December 2019 RPKs increased 4.5% against the same month in 2018. That was an improvement over the 3.3% annual growth recorded in November, primarily due to solid demand in North America.

“A irlines did well to maintain steady growth last year in the face of a number of challenges. A softer economic backdrop, weak global trade activity, and political and geopolitical tensions took their toll on demand.

Astute capacity management, and the effects of the 737 MAX grounding, contributed to another record load factor, helping the industry to manage through weaker demand and improving environmental performance,” said Alexandre de Juniac, IATA’s Director General and CEO. International Passenger Markets 2019 international passenger traffic climbed 4.1% compared to 2018, down

2019 % Total Market Africa Asia Pacific Europe Latin America Middle East North America

World share1 100.0% 2.1% 34.7% 26.8% 5.1% 9.0% 22.3%

Alexandre de Juniac from 7.1% annual growth the year before. Capacity rose 3.0% and load factor edged up 0.8 percentage point to 82.0%.

Asia-Pacific airlines’ full-year traffic increased 4.5% in 2019, which was a large decline compared to 8.5% growth in 2018. This reflected the impact of the US-China trade war as well as weakening business confidence and economic activity. Capacity rose 4.1%, and load factor ticked up 0.3 percentage point to 80.9%.

European carriers saw a 4.4% traffic rise in 2019, which was down from 7.5% annual growth in 2018. Capacity rose 3.7% and load factor increased 0.6 percentage point to 85.6%, which was the highest for any region. The lowered results are attributable to generally slowing economic activity; declining business confidence, compounded by

RPK

ASK

4.2% 4.9% 4.8% 4.2% 4.2% 2.4% 4.1%

3.4% 4.7% 4.5% 3.6% 2.9% 0.1% 2.8%

PLF (%pt)2 0.7% 0.1% 0.2% 0.5% 1.0% 1.7% 1.0%

PLF (level)3 82.6% 71.7% 81.9% 85.2% 82.6% 76.2% 84.9%

1% of industry RPKs in 2019 2Year-on-year change in load factor 3Load Factor Level 10

industrial disputes (strikes); Brexit uncertainty and the collapse of a number of airlines.

Middle Eastern airlines’ passenger demand increased 2.6% last year, the slowest pace of expansion among all regions and down from 4.9% growth in 2018. However, demand began to recover in the fourth quarter and the monthly growth of 6.4% in December led a l l reg ions. A n nua l capacit y climbed 0.1% and load factor surged 1.8 percentage points to 76.3%.

Nor th American airlines saw traffic growth slow to 3.9% last year, down from 5.0% in 2018, amid softer US economic activity and weaker business confidence compared to 2018.

Capacity climbed 2.2%, and load factor strengthened 1.3 percentage points to 84.0%, second highest among the regions.

Latin American airlines’ traffic climbed 3.0% in 2019, a dramatic slowdown compared to 7.5% annual growth in 2018. Capacity rose 1.6% and load factor increased by 1.1 percentage points to 82.9%. The year was impacted by social unrest and economic difficulties in a number of countries in the region.

African airlines led all regions with a 5.0% demand increase, down from 6.3% growth recorded for 2018.

Capacity rose 4.5%, and load factor edged up 0.3 percentage point to 71.3%. Airlines in the region benefitted PAYLOAD ASIA | Febuary 2020

2019 % Domestic Australia Brazil China P.R. India Japan Russian Fed. US

World share1 36.2% 0.8% 1.1% 9.8% 1.6% 1.1% 1.5% 14.0%

RPK

ASK

4.5% 0.1% 0.4% 7.8% 5.1% 3.9% 6.7% 4.5%

4.1% 0.1% -1.4% 8.2% 4.2% 2.8% 7.1% 3.5%

PLF (%pt)2 0.4% 0.0% 1.5% -0.3% 0.7% 0.8% -0.3% 0.8%

PLF (level)3 83.7% 80.1% 82.7% 84.6% 87.4% 73.8% 83.2% 85.5%

1 % of industry FTKs in 2019 2 Year-on-year change in load factor 3 Load factor level from a generally supportive economic backdrop in 2019 as well as increases in air transport connectivity.

Domestic Passenger Markets Domestic air travel climbed 4.5% in 2019, which was down from 7.8% in 2018. All markets showed annual growth, led by China and Russia.

Capacity rose 4.1% and load factor was 83.7%, up 0.4% percentage point compared to 2018.

China’s airlines saw domestic passenger traffic expand by 7.8% in 2019, the slowest pace since the global financial crisis. Softer economic activity amid the US-China trade war, compounded by weaker consumer spending and

unrest in Hong Kong all contributed to the slowdown. Looking into early 2020, any positive impacts of the ‘phase one’ trade agreement with the US likely will be countered by the impact of the coronavirus outbreak.

Indian airlines’ four years of doubledigit demand growth came to a halt in 2019, as traffic rose 5.1%, down from 18.9% in 2018. The bankruptcy of Jet Airways and weakening economic activity were the main culprits of the slowdown.

The Bottom Line “2019 was a difficult year for aviation and 2020 is off to a tragic and challenging

beginning.

The shooting down of PS 752 in January was inexcusable. Commercial aircraft are instruments of peace, not military targets. To honor the victims of this tragedy we must address this challenge with governments and stakeholders. Our thoughts are also with the injured, and the families of those who lost their lives, in the PC2193 accident in Turkey yesterday. Safety is the aviation industry’s number one priority and we are united in our desire to understand and learn from the circumstances of this tragedy.

Today, headlines are also focused on the novel coronavirus. From our experience of past outbreaks, airlines have well-developed standards and best practices to keep travel safe. And airlines are assisting the World Health Organization (WHO) and public health authorities in efforts to contain the outbreak in line with the International Health Regulations. There currently is no advice from WHO to restrict travel or trade. But it is clear that demand has fallen on routes associated with China, and airlines are responding to this by cutting capacity for both domestic and international China. The situation is evolving fast, but we are observing significant schedules adjustments for February.” said de Juniac.

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Feat u re - A ir line

Saudia Cargo sponsors Saudi International Golf Tournament Hariri: We contributed to numerous global events as a national company.

Saudia Cargo’s sponsorship for the Second Saudi International Golf Tournament is part of the threeyear contract signed with the IMG Company, the organizer of the event, Chief Executive Officer Omar Talal Hariri said.

Hariri commended the successful sponsorship of the first tournament last year, which encouraged the Saudia Cargo to do the same for this year, noting that the Saudia Cargo was keen to participate in this global event, taking place in the Kingdom because it believes that golf is one of the many popular sports around the world. Hariri stressed that the Kingdom boasts one of the most advanced sports infrastructure including golf courts, which enables it to host any international sports championships.

In a statement he made prior to the launch of the tournament next Thursday, Hariri said, “Last year’s big success will definitely make us together with the Saudi Golf Federation and the sponsors participating in the event exert more efforts to prepare for this global event, which will take place at the King Abdullah Economic City (KAEC)’s Royal Greens Golf and Country Club from January 30 to February 02.”

Hariri commended the pivotal role of the General Sports Authority (GSA) under the leadership of Prince Abdulaziz bin Turki Al-Faisal and noted that the GSA closely follows up all sports activities and international events held in the Kingdom. The GSA accomplishments have reflected the Kingdom’s exceptional and advanced capabilities for organizing different sports events.

Hariri pointed out that the Saudia Cargo was keener this year to invite VIPs from the air cargo and ground 12

handing sector as well as its partners in the government sector to attend the ac tiv itie s and comp e titions accompanying this event. The Family Day for Saudia Cargo staff ’s will be held at Saudia Cargo Pavilion inside the Fans Village. Numerous senior officials, organizers and international golf players are expected to visit the pavilion. “ We made remarkable accomplishments for the air cargo business in 2019 and contributed effectively to various sports and entertainment events. Saudia Cargo harnessed its human and financial resources and recorded incredible

successes during Jeddah and Riyadh seasons, notably the transportation of the WWE equipment, luxurious cars, and Formula E cars that participated in the Riyadh International Expo last November. It also carried heavy equipment and supplies for events such as the fireworks, the cirque and the World Golf Tournament 2020,” Hariri said.

S au d i a C a rg o re co g n i z e s th e important role it plays in developing the logistic and cargo services sector and the serious efforts it continues to exert to effectively support Vision 2030 objectives, aiming to turn the Kingdom into a global logistics hub by making advantage of its strategic and vital geographical location. Saudia Cargo has also contributed to achieving the Vision 2030 objectives for other sectors and programs including the Quality of Life Program, which seeks to meet and surpass the expectations of different segments of society through holding various cultural, entertainment and sports events.

PAYLOAD ASIA | Febuary 2020

F eat u re - A ir line

Facial recognition technology throughout the passenger journey

The Single Token Journey concept is part of the Airports 4.0 Initiative and is a tri-partite partnership between Malaysia Airports, SITA and Malaysia Airlines.

Passengers travelling to Japan were pleasantly surprised to be the first to experience the Single Token Journey concept at KL International Airport (IATA Code: KUL) today. The single token journey concept utilises facial recognition technology providing passengers with one single identification verification that will take them through the entire airport touch points from check-in to the boarding gate. It is part of the Airports 4.0 initiative that aims to transform KUL into a smart airport through the use of big data analytics (BDA).

The concept is being piloted for a period of three months in collaboration with Malaysia Airlines and SITA, the world leading air transport specialist in communications and information te chnolog y. D uring this p erio d, passengers on two daily Malaysia Airlines flights to Narita International Airport (IATA Code: NRT), Tokyo and Kansai International Airport (IATA Code: KIX), Osaka will get to enjoy this convenience.

Facial recognition scanners have been placed at check-in counters H5 to H8, and e-gates have been placed at the security screening touch points and at the boarding gates. Passengers on these flights will only need to scan their faces to verify their ‘token’ at all the touch points. They no longer need to present their passports or boarding passes when going through these checkpoints.

According to the acting group chief

www.payloadasia.com | Fenuary 2020

executive officer (AGCEO) of Malaysia Airports, Dato’ Mohd Shukrie Mohd Salleh, the single token journey concept is a testament of the organisation’s continuous commitment in improving services at the airports, “Our main focus in moving forward is to strengthen Malaysia’s position as an aviation hub.

We will ensure that services at our airports are at par with other mega hubs around the world. Harnessing technology for this purpose is one way we can simplify airport processes for our guests. This initiative is especially timely in view of Visit Malaysia 2020.

We expect to have a successful pilot so that we can implement this in totality at KUL,” he said.

Malaysia Aviation Group chief executive officer (CEO) Captain Izham Ismail said, “The single-token journey concept is collaboration with Malaysia Airports, which will allow our passengers to enjoy reduced check-in time and identity verification within seconds. As this is the trial period, we will make this option available first to passengers flying into Tokyo and Osaka to gather feedback and monitor their acceptance rate. The single-token will also help manage the queue at our check-in counters, especially during peak periods, and we hope to fully adopt this system by quarter four of 2020.”

Sumesh Patel, SITA President Asia Pacific, said: “SITA is delighted to be a partner of Malaysia Airports for its Airports 4.0 digital transformation initiative. With SITA Smart PathTM, your face becomes your boarding pass and passport, eliminating the need for passengers to provide travel documents repeatedly throughout the airport. We look forward to working with Malaysia Airports and Malaysia Airlines to deliver an elevated customer experience through this new biometric technology for ID management.”

The single-token biometric ID approach no longer requires checking of any physical identity at the various multiple checkpoints because all data have been disseminated to all relevant parties such as the airlines, immigration and customs.

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Feat u re - A ir line

Etihad Cargo renews WFS Global handling framework

Frankfurt and Madrid added to existing station portfolio in Europe, the United States and Asia.

Etihad Cargo, the cargo and logistics arm of Etihad Aviation Group, has renewed its global cargo handling agreements with Worldwide Flight Services (WFS), the world’s largest air cargo handler, with Frankfurt and Madrid joining six existing gateways in Europe, Asia and the United States.

The three-year framework extension will see WFS continue to provide Etihad Cargo with warehouse and cargo handling services at New York’s John F. Kennedy International Airport (JFK) and Washington DC’s Dulles International Airport (IAD) in the United States, Bangkok’s Suvarnabhumi Airport (BKK), as well as key European gateways at London Heathrow (LHR), Paris-Charles De Gaulle (CDG) and Brussels Airport (BRU). The six airports handle in excess of 120,000 tonnes of Etihad Cargo air cargo annually.

Following the expansion of the above warehouse operations portfolio to include Adolfo Suárez Madrid-Barajas (MAD) in November 2019, WFS will now also begin services at Frankfurt Airport (FRA) from 15 February 2020.

Andre Blech, Head of Operations and Service Delivery at Etihad Cargo, said: “In-line with our commitment to provide service-level excellence and best practices across all stations, the addition of Frankfurt and Madrid to our existing framework WFS further evidences our growing and mutually beneficial collaboration.”

B arr y Na ssb erg , Group Chief Commercial Officer of WFS, added: “Etihad Cargo not only expects the highest quality of handling services for its customers, it also wants these to be delivered consistently at every major airport across its network. To achieve this requires a strong partnership approach.

Our global handling framework with Etihad Cargo means WFS is fully engaged with the airline at a corporate level and

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able to proactively support its drive for the very best cargo and ground handling services. It also demonstrates we have a fully committed, long-term partner which values our handling expertise and is looking to us for innovative and efficient ways to help their business grow.”

A key part of the framework is a renewed focus on premium products, including temperature sensitive cargo, that are key to Etihad Cargo’s value offering. Having become only the second global carrier to obtain IATA CEIV certifications for both pharmaceutical and perishable logistics, Etihad Cargo’s partnership with WFS enhances its endto-end cool-chain solutions in the key gateways of Paris and Brussels, where WFS also holds CEIV accreditations for its warehouse operations.

In addition to cargo, WFS provides Etihad Airways with passenger ground handling “above the wing” services at JFK, Chicago O’Hare International Airport (ORD) and Suvarnabhumi (BKK), which have also been extended under the framework agreement.

Having launched an all-encompassing

transformation programme in 2018, Etihad Cargo has since witnessed significant change across its fleet and network, evolved its commercial proposition, and overhauled its physical and digital infrastructure. The agreement with WFS is the latest involving infrastructure and warehouse support, and follows a framework signed with Abu Dhabi Airports Company in December 2019 to upgrade its existing facilities at Abu Dhabi International Airport.

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PAYLOAD ASIA | Febuary 2020

F eat u re - A ir line

Global Air Cargo down 4% at start of 2020 as industry awaits impact of coronavirus

Frankfurt and Madrid added to existing station portfolio in Europe, the United States and Asia.

The global air cargo market saw a 4% year-on-year decline in the four weeks to February 2, 2020, according to the latest ‘dynamic load factor’ market intelligence from CLIVE Data Services. The dynamic load factor fell two percentage points relative to last year to 65%.

CLIVE’s first-to-market analysis each month consolidates data shared by a representative group of international airlines operating to all corners of the globe. Based on both the volume and weight perspectives of the cargo flown and capacity available, it gives the air cargo industry the earliest possible barometer of market performance each month.

Four-week data to February 2 largely reflects the influence of the earlier Chinese New Year but CLIVE is also closely monitoring the impact of the coronavirus on airfreight volumes, which will be clearly evident in its data reports over the coming weeks.

CLIVE’s Managing Director, Niall van de Wouw said: “At face value, the 4% drop in global air cargo in the weeks between January 6-February 2 appear to be quite a setback relative to the growth numbers seen in the last 3 months of 2019. But looking at the data in more detail tells a more nuanced picture. The Chinese New Year holiday started this year on January 25, one week earlier than in 2019. By our estimates, the fact that this is holiday is celebrated in such major air cargo origins as China, Hong Kong, South Korea and Singapore, pushed the overall growth number down by around -3% for the start of the year. This implies that the ‘normalised’ global market saw a decline of -1%.”

Niall van de Wouw - CLIVE Data Services

For a regional holiday to have such an impact on global volumes, the drop must be quite dramatic, as CLIVE’s latest intelligence demonstrates. In the last week of January, volumes from China to Europe, relative to the same week in 2019, dropped by 66%. Subsequently, the dynamic load factor of westbound flights from China dropped from close to 90% to 74%. The reason for the load factor not dropping further is due to airlines cutting capacity by 44% relative to the same week last year.

Most of this fall in capacity was caused by a reduction of freighter services in anticipation of the weaker demand.

“While the industry traditionally

China to Europe - year over year change

www.payloadasia.com | Fenuary 2020

anticipates lower demand during Chinese New Year, the big unknown now is the impact of the coronavirus at the start of a year where there was previously slight optimism for a modest recovery in air cargo volumes. We have already seen airlines suspending passenger services in response to the virus, and now it’s a case of wait and see. The impact of the coronavirus on cargo volumes out of China will become clearer in the weeks to come when the factories reopen and their supply chains are brought up to speed again. How quickly that will happen – and what knock-on effects it has for global air cargo industry – will be a strong indicator for the year ahead.”

China to Europe and Middle East dynamic load factor

15

Focu s

‘Book it Right and Pack it Tight’

Insurance mutuals urge the container shipping industry and participants in the global supply chain it serves to give ever more serious attention to the causes and consequences of ship fires, jointly issuing a guide outlining the responsibilities of all stakeholders in reducing risk.

This year saw mandatory enforcement of the latest version of the IMDG Code, Amendment 39-18. As the incorrect declaration, packing, handling and stowage of dangerous goods of all types is seen as a primary cause of many container ship fires, insurance mutuals UK P&I and TT Club have once more collaborated in publishing guidelines under the title ‘Book it Right and Pack it Tight’.

The guide published this week and available free of charge*, provides key insights for all actors in the freight supply chain responsible for preparing unitised consignments for carriage by sea. It gives an overview of the practical duties and responsibilities under the IMDG Code for each stakeholder.

Stuart Edmonston is UK P&I’’s Loss Prevention Director. “As mutuals, our chief aim is to minimise risk for our Members and the industry we serve,” he says. “The recent spate of container ship fires with the consequent loss of life, damage to ships and cargo, and trade disruption has been a major concern to ourselves and TT Club. UK P&I continue to participate in initiatives which focus on the capability to detect, suppress and extinguish fires at sea. However, we share our sister organisation’s desire to tackle the causes of such fires at source.”

TT Club sees its core contribution to seek significant improvements in cargo declaration and packing. “As so often the case, fires and explosions are merely the ‘tip of the iceberg’ of problems, which are

16

inherent throughout the supply chain,” observes Peregrine Storrs-Fox, TT Club’s Risk Management Director. “There are far too many errors in classification and declaration of commodities to be transported. These are often amplified by poor decisions and practices relating to packaging, packing, segregation and securing. Such errors severely compromise safety in a variety of ways, but most critically when the goods should be rightly be described as dangerous in a regulated sense and, here, in compliance the IMDG Code.”

Uffe Ernst-Frederiksen, Head of Cargo Management at Maersk Line and Chairman of CINS says of this guide, “I find this publication to be tremendously useful and that if only people would read one book this year that it should be this one.”Through its ‘Cargo Integrity’ Campaign TT Club has been for some

time seeking to enhance awareness of the issues and to urge implementation of more rigorous practices relating to entering cargo into the supply chain. Its support of, and participation in CINS, is one such initiative. CINS is comprised of representative of container shipping lines which together control over 85% of the world’s container slot capacity.

A recent CINS report, which should be seen as complementary to ‘Book it Right and Pack it Tight’, demonstrates substantial effort by the industry to bring understanding to the complexities involved in the ship stowage processes.

It seeks to develop a commonality of approach in order to improve safety.

Entitled ‘Safety Considerations for Ship Operators Related to Risk-Based Stowage of Dangerous Goods on Containerships’**, it underlines the irrefutable fact that proper declaration is a paramount prerequisite.

One of the expert companies involved in the preparation of the CINS Risk Based Stowage report was Exis Technologies, whose input was focused around its detailed knowledge of the IMDG Code Dangerous Goods List and stowage requirements. In collaboration other industry experts Exis categorised each commodity on the List by UN Number, placing it in the appropriate Risk Zone as defined by the CINS Stowage guidelines.

In order to further encourage the use of these guidelines, Exis has gifted the Hazcheck Risk Zone Data*** online as a free resource to all involved across the container supply chain.

PAYLOAD ASIA | Febuary 2020

Feat u re - L o gi s t i c s

FedEx supports transportation of medical supplies in urgent needs

Facing the spread of the novel coronavirus, FedEx Express is using its extensive global network and logistics resources to provide rapid transportation services for medical supplies destined to Wuhan by working with related organizations, partners and customers.

As part of these efforts, in the early morning of January 26 and 27, FedEx transported the first batch of medical supplies from the U.S. and Japan for our customers to the Guangzhou Baiyun International Airport. These medical supplies include the N95 masks, medical gloves, plastic goggles, disinfectant wipes and antibiotic.

With the support from Guangzhou B aiy un Air p or t Customs , Fe dEx

swiftly completed the clearance of the shipments. China Post delivered these shipments to Wuhan on January 27.

China Post donated its transportation and delivery services of epidemic prevention supplies to the organizations in Wuhan area designated by the Wuhan government. It is the first batch of medical supplies that FedEx has shipped through the distribution channels of China Post.

FedEx Express will also ship more than 200,000 surgical masks and personal protective equipment such as gowns and gloves from the U.S. to its Asia Pacific Hub in Guangzhou, China to assist the humanitarian work of Direct Relief. FedEx is working closely with China Post, which is coordinating

the movement of the supplies from Guangzhou into Wuhan, in order to deliver the relief as quickly as possible.

Since January 25, FedEx has been assisting Medtronic in providing China’s medical organizations with medical equipment including the Extracorporeal Membrane Oxygenator (ECMO), medical ventilators and patient monitors. The first batch of shipments of over 600 pieces of medical equipment and components has been transported quickly and safely to different locations from FedEx warehouse in Shanghai. Now the equipment has already been used treat patients infected by the coronavirus.

“FedEx is using its longstanding relationships w ith humanitarian organizations and its global network to answer the call for much needed medical supplies to China ,” said Karen Reddington, president, Asia Pacific, FedEx Express. “We extend our sympathies to those directly impacted.

We are glad we are able to provide support at a time when responsiveness is critical, working with multiple China and international partners.”

FedEx has a long history of working with non-profit and government entities to support communities and economies during times of crisis. The company has donated US$6 million in cash and in-kind assistance to support humanitarian organizations during this fiscal year, which began on June 1, 2019. FedEx is maintaining frequent communication with non-profit teams to ensure that our resources are deployed effectively.

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17

Feat u re - L o gi s t i c s

Cross-border opportunities

SEKO Logistics and Air & Ground World Transport form partnership to give clients in the US and Asia broader growth and supply chain opportunities.

James T. Gagne - SEKO Logistics

Shirley Yeung - AGWorld

SEKO Logistics and Air & Ground World Transport (AGWorld) have signed a strategic partnership to create new cross-border growth opportunities for shippers doing business between Asia and the United States as global trade disputes accelerate demand for broader geographic supply chain solutions.

Work ing to ge ther, SE KO and AGWorld will offer clients a unique platform of ser v ices to de velop new trade relationships, leveraging AGWorld’s network of offices in Hong Kong, Shanghai, Beijing, Taipei, Shenzhen, Guangzhou Manila and Ho Chi Minh City among other locations and SEKO Logistics’ more than 120 branches in 40 countries.

Clients based in Asia or buying goods from suppliers in the region will gain immediate access to SEKO’s 60-branch network across North America as well as its award-winning demand chain solutions, including Last Mile across the United States, White Glove, Omni-Channel Logistics, Cross Border Parcel Consolidations and Domestic Expedite.

The partnership between the two companies is timed to give customers greater access to countries which are rapidly increasing their importance in

global supply chains as businesses look for new sales and supply channels.

James Gagne, President & CEO, of SEKO Logistics, said: “We are excited to be partnering with AGWorld. We see this as a long-term relationship with outstanding potential to broaden our growth in the US, Asia and Europe.

Both companies have a great deal to offer each other and our respective clients. SEKO customers will gain from greater access to the Southeast Asia market with AG World’s significant airfreight tonnage and scalable capacity platform, while AGWorld clients in the high-tech, retail, manufacturing, healthcare and other industries can plug into our coast-to-coast US network and SEKO’s proven value-added 3PL and forwarding expertise, cross-border parcel platform with Section 321 and Type 86 express clearance capabilities and portfolio of services bundled with its award-winning technology.”

The new partnership supports SEKO’s program to accelerate its growth by creating the right types of strategic partnerships and undertaking acquisitions to enhance its technology, network and service capabilities. In 2018, SEKO also established a similar strategic partnership with Hermes Germany, one of the largest players

18

on the European parcel and 2-manhandling market and a highly efficient provider of supply chain solutions.

Shirley Yeung, Chief Operating Officer of AGWorld, said: “This partnership will provide numerous benefits to our clients who have grown with us as their global freight forwarding partner. They will now have access to SEKO’s focused service offerings in Omni-Channel Logistics, White Glove and other value-added services and locations to complement our best-in-class freight forwarding services. Additionally, we’re excited to offer our scope of services to SEKO’s clients and locations with focus on airfreight forwarding into the United States from Asia.”

Terry Unrein, Chief Commercial Officer of SEKO Logistics, said: “The timing of our partnership is not only very significant to us but, most importantly, to our customers who can now expedite their growth in 2020 and beyond using our enhanced value-added forwarding solutions. We will now be able to offer additional services for our North American and European clients across more markets in Asia, allowing us both to leverage our complementary airfreight solutions bundled with our global omni-channel logistics network and white glove services.”

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PAYLOAD ASIA | Febuary 2020

Feat u re - L o gi s t i c s

The On-Board-Courier The core of Samedaylogistics

Whether you have time critical hand carry shipments, express airfreight, temperature critical or high security transports - Samedaylogistics are the experts in emergency logistics since 1996. The company is located in Kelsterbach near by Europe’s largest cargo airport Frankfurt am Main.

Have you ever heard about an OnBoard-Courier, OBC or even a Handcarry?

No? The company Samedaylogistics deals with exactly these expressions every day. Better said, the On-Board-Courier (OBC) is the heart and at the same time the main product of the company and is daily offered on the market as a logistics service.

An On-Board-Courier, OBC or Handcarry is needed in logistics especially in the area of emergency logistics - when shipments need to be transported from A to B more urgently or safely than usual.

Typical examples of such situations are an impending production downtime, missing documents for important contracts, but also medical emergencies (blood donations, plasma donations, organs) and urgently needed spare parts for passenger or cargo aircrafts.

As you can probably imagine, these situations, the companies and people involved in each case, present immense challenges in terms of time and cost. A solution must be found. And it must be fast, perfectly planned and yet financially attractive.

This is exactly where Samedaylogistics comes into the game. Samedaylogistics is specialized in the field of emergency logistics and solves such special and sometimes extraordinary logistical challenges every day. And how? With an OBC! And how does that work? Very simple!

Samedaylogistics receives an inquiry

www.payloadasia.com | Febuary 2020

about a logistical emergency by phone or e-mail. The company’s specially qualified employees now work out the fastest and most efficient transport route within a few minutes and send the customer an offer with the necessary details to solve the logistical emergency as efficiently as possible. Of course, the customer is personally advised regarding the possible transport routes.

Samedaylogistics has an internationally established network with reliable OBCs. If the customer accepts the offer, this means that the available courier closest to the airport of departure is assigned to the order. The OBC is immediately ready for take-off and accompanies the goods to be transported from pick-up to personal delivery, even beyond the destination airport, if this is requested by the customer. Of course, Samedaylogistics also takes care of the customs clearance of the shipment and informs the customer proactively, at every step of the transport, about the

status of the goods. Thus, the customer is informed about the current location of the shipment and its condition at all times. After the courier has arrived at the desired destination, the goods are of course handed over to the consignee and the logistical emergency situation is defused.

The obvious main advantages of using a Handcarry are on the one hand the personal tracking of the shipment during the entire transport, and on the other hand of course the maximum speed with which the goods reach their destination, since the shipment is transported on board of a passenger aircraft and baggage has priority to cargo with every airline.

Samedaylogistics offers the service of an On-Board-Courier 24 hours, 7 days a week, worldwide for customers of all branches and every logistic challenge.

Characteristics such as reliability, speed and flexibility are a matter of course for the company and are lived 100% in its daily business.

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Feat u re

How to Communicate during Covid-19 Disruptions capability in handling the situation.

Tips for Freight and Logistics Leaders

By Kathy O’Brien is managing director of Singapore-based Red Shoe Communications, the 2019 gold winner of Best Employee Communications Training Provider by HRO. The Covid-19 outbreak has come hot on the heels of deteriorations in world trade and disrupted business in diverse ways. The international freight and logistics sectors have not been spared. Covid-19 has jeopardised meeting customers’ needs and expectations to connect faster to more markets in the digital era.

News on the outbreak may not be certain or reassuring but as a leader, your role is to reassure people and deal with suppliers when you speak up. Standing in front of your workers, board and business partners will never be easy in these circumstances.

Th e b u s i n e s s q u e s t i o n s a r e plentiful: How can you return to business-as-usual when do many aspects of it are unsettled? How can you mitigate the delays in shipments and deliveries, or clear new custom protocols? How can you ensure continuity and uplift morale when the end of the outbreak is not yet in sight?

These fluid, uncertain issues will understandably cause you to stand back and let your other colleagues handle the situation. Now is the time to pause, reflect and plan how you are personally communicating to your key stakeholders. Your business partners and workers need to see your face and hear the message from the leader. When you stand before them and speak in such a challenging time, you convey: • Their value to the organisation 20

• Management’s commitment • Yo u r i n v o l v e m e n t i n continuity planning and operations Your ability to speak up with courage as early as possible will shape something critical in any work environment: trust.

Here are some tips to ensure that when you do step into the spotlight, you project your most genuine and effective self. This could be via a video recording or ‘live’ feed, since gathering in large numbers should be avoided at this time.

Choose Your Words Take note of the things you want to say and rehearse these points. Be careful how you word your sentences and what kind of phrases or images you associate your company with. You always want to point your audience in the right direction.

Listen to Yourself Listen carefully to how you deliver the points. You could use your phone to record. Rewind the clips back and open your ears.

Next, analyse your performance.

Carefully assess how you are speaking to the audience. How confident do you sound? Do you sound authentic?

Rehearse, rehearse and rehearse again until you can do it with flair. Don’t give up, this is an important step. You will need to reassure people of your

Warm Up Your Voice Ensure that your voice is warmed up and smooth. Drink some warm water with lem0n to soothe it and have a glass near you.

Humming scales could also warm up you voice. Use the lower vocal tones which come off more selfassuring.

Purposely pause before key words and give them extra vocal emphasis when you rehearse. Pay close attention to your vocal qualities when you listen to your playback.

Deliberate Movements Mind your body language. Practise walking into the room – yes, really.

Your audience won’t know they are doing this, but they’ll form an impression of your confidence from the way you walk and stand. They will draw conclusions from your eye contact – or the lack of.

Get a trusted colleague to film your rehearsal on your mobile phone camera. As you replay, make sure your body language delivers your intended message.

In the ‘real moment’, lift your chin, align your shoulders fully to the camera, move purposefully and maximise your eye contact.

Show You Care A final and most important tip: acknowledge their efforts. Thank them for all the y are doing to cope with this difficult situation.

Thank them for understanding the disruptions in processes, shipments and deliveries . Thank them for adapting to changing working flows.

For being responsible with health precautions so that everyone stays safe. For supporting quarantined coworkers. For coming in today, despite concerns for their health.

This is an opportunity for you to show your partners and workers what matters. And you have this opportunity to do it well.

PAYLOAD ASIA | Febuary 2020

Feat ure

FedEx Earns No. 14 Spot on the FORTUNE World’s Most Admired Companies List Only company in the Delivery category ranked in the Top 20.

FedEx Corp. is once again ranked among the most admired companies in the world, according to a survey published in FORTUNE magazine.

The annual “World’s Most Admired Companies” report released today lists FedEx as the No. 14 ranked company overall, tied with American Express and Netflix. The survey measures nine attributes related to the company’s financial performance and corporate reputation.

“To be consistently ranked in the top 20 of the FORTUNE World’s Most Admired Company rankings is an incredible achievement, and by no small measure our team members in the Asia Pacific region have contributed to this result,” said Karen Reddington, president, Asia Pacific, FedEx Express. “Our ranking is a reflection of our unique culture.

With a strong people first philosophy, we strive to make every customer experience outstanding.’’

This is the 20th consecutive year that FedEx has ranked among the top 20 in the FORTUNE Most Admired Companies List.

Survey Methodology Fortune collaborated with Korn Ferry on this survey of corporate reputations.

They began with a universe of about 1,500 candidates: the 1,000 largest U.S. companies ranked by revenue, along with non-U.S. companies in Fortune’s Global 500 database that have revenues of $10 billion or more. They then winnowed

www.payloadasia.com | Febuary 2020

the assortment to the highest-revenue companies in each industry, a total of 680 in 30 countries. The top-rated companies were picked from that pool of 680; the executives who voted work at the companies in that group.

To determine the best-regarded companies in 52 industries, Korn Ferry asked executives, directors, and analysts to rate enterprises in their own industry on nine criteria, from investment value and quality of management and products to social responsibility and ability to attract talent. A company’s score must rank in the top half of its industry survey to be listed.

Because of the weak distribution of responses, only the aggregate industry scores and ranks are published in Construction and Farm Machinery, Food and Drugstores, General Merchandisers, Metals, Mining, Crude-Oil Production, Network and Other Communications Equipment, and Wholesalers: Health Care. Results were not published in the following categories due to insufficient response rates: Cable and Satellite Providers, Petroleum Refining, Pipelines and U.S. Energy.

To select the 50 All-Stars, Korn Ferry asked 3,770 executives, directors, and securities analysts who had responded to the industry surveys to select the 10 companies they admired most.

They chose from a list made up of the companies that ranked in the top 25% in last year’s surveys, plus those that finished in the top 20% of their industry.

Anyone could vote for any company in any industry. The difference in the voting rolls explains why some results can seem at odds with each other. For example, UnitedHealth Group fell off the All-Star list this year but ranked number one within the insurance and managed care category when votes from only those in that industry were counted. Korn Ferry, which has conducted the research for the World’s Most Admired Companies list since 1997, is a global management consulting firm.

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Feat u re

Shipping Market to Pick Up in 2020 After going through ups and downs in the past decade, the shipping industry is finally expected to make a comeback in 2020. With the new regulation implemented by the International Maritime Organization (IMO) to curb sulphur emissions, scrubber retrofits and removals of older fleets that have high a compliance cost are expected to lead to fleet tightening, which will help increasing freight rates across sectors, and ultimately to boost new orders.

As of 1 January 2020, about 2,000 vessels, or less than 10 percent of the global fleet capacity, are equipped with scrubbers. “Scrubber adoption started slow last year and scrubber retrofitting also has been delayed due to technical difficulties and lack of key parts available in yards,” said Dalibor Gogic, principal analyst at IHS Markit. “However, scrubber adoption is expected to continue and a second wave of installations is expected this year.”

IHS Markit expects more than 3,500 units to be equipped with scrubbers

by January 2021, which includes both the number of new orders expected to be delivered and the number of vessels expected to be retrofitted with scrubber technology.

There also seems to be some potential for fleet removals. Demolitions have been very low in the last couple of years,

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after almost 1 million TEUs of capacity was removed in 2016 and 2017 from the container shipping market. About 3 percent of fleet older than 20 years would be prime candidates for demolitions in 2020.

“Considering the fact that fleet supply will likely tighten due to scrubber retrofitting and potential demolitions, given that demand remains healthy, we may see stronger freight rates this year,” Gogic said. “In addition, the fact that the order book for major commodity fleets has been relatively quiet in the last two

to three years, we expect to see some intensification of new building orders throughout the next couple of years.”

Dry Freight Market to Be Stable in 2020 IHS Markit expects the dry bulk market is on the long-term recovery cycle, primarily driven by supply normalization.

The dry bulk fleet is expected to grow 3 percent in 2020, compared to 3.8 percent in 2019.

Considering the fleet that is currently expected to have a scrubber retrofitted, fleet supply contractions on an annualized level are expected to continue with 1 to 2 percent of the dry bulk fleet offline in 2020.

“For 2020, the dry freight market is expected to be stable with artificial supply tightness owing to scrubber installations as well as robust iron ore trade growth while political risk remains in the coal trading sector,” said Daejin Lee, principal consultant at IHS Markit.

Iron ore trade looks promising with Brazil set to produce more iron ore in 2020 after the tragic dam accident last year. Coal is an uncertain area where political decisions on environmental issues will determine the demand. IHS Markit expects coal trade to grow about 1 percent in 2020 with strong India PAYLOAD ASIA | Febuary 2020

Feat ure and ASEAN demand despite structural decline in European coal demand.

Oil Tanker Freight Market to Be Stronger in 2020 The oil market will undoubtedly remain volatile due to concerns about global trade and slowing GDP growth together with uncertainty and instability in the Middle East Gulf. World merchandise trade volume is forecast to grow 2.7 percent in 2020 year over year to 14.2 trillion tons, accompanied by real GDP growth of 2.5 percent. However, the oil tanker freight market is expected to be stronger in 2020 than last year with fundamentals starting to noticeably improve since the second half of 2019.

Assuming global crude oil trade growth reaches 1.4 million barrels per day, shipping demand in deadweight tonnage (DWT) is projected to increase by about 2.5 percent in 2020, with a slightly higher rate expected for demand in ton miles, as the US will export more to destinations further afield, pushing the average haul significantly higher. This could mean shipping demand growth for the entire tanker sector could reach about 4 percent.

Fo c u sing on t anker demand, fundamentals are expected to start improving due to non-OPEC additions.

“OPEC’s market share slowed down further in 2019, in parallel to production cuts and the collapse of Iran and

Venezuela,” said Fotios Katsoulas, principal analyst at IHS Markit. “Most growth is now coming primarily from the United States, Brazil, Guyana and Norway.”

China’s appetite for crude oil will remain quite strong with more optimism, as there has been some progress in USChina negotiations, with China having started to import US barrels once again since late 2019.

IHS Markit expects high volatility for spot rates, together with recovery for period rates and asset prices. “Overall, there is strong optimism around demand for shipping in 2020,” said Rahul Kapoor, Vice President at IHS Markit.

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www.payloadasia.com | Febuary 2020

23

Feat u re

GEODIS develops time definite road freight service across Southeast Asia

Pioneer of cross-border trucking in the region now offers scheduled departures for consignments along the Singapore-Kuala LumpurBangkok axis, with multi-modal gateway services beyond these hubs.

Drawing on a wealth of experience running trucking services in the region over the last twenty years, GEODIS Road Network (GRN) Asia Pacific is now established as a time and date specific service. 2020 will see expansion of GRN’s time definite schedule to/from hubs throughout the Southeast Asian landmass.

Trade cooperation within the ASEAN bloc continues to strengthen through free trade agreements and e-commerce activity is set to rise dramatically. Both trends support the forecast of growth in the regional cross-border road transport market to some USD4.1 billion in revenue by 2023. This represents an annual growth rate of over 15%.

“GEODIS recognises the opportunities this brings to its customers and will continue to develop GRN in support of their business growth,” comments Rene Bach-Larsen, Sub-Regional Managing Director, ASEAN. “As the region’s road infrastructure continues to improve beyond the Singapore-KL-Bangkok spine, scheduled road transits will become an increasingly attractive option, being faster than sea and cheaper than air. ”GEODIS has identified that this gap in the market is particularly true for 30 to 1000 kilo payload shipments. GRN will benefit shippers of such consignments with a simplified, door-to-door tariff structure.

For customers with this type of freight, GRN offers end-to-end control through the skills of GEODIS teams across the region, providing seamless management of consignments from first to last mile. To add to this level of care GEODIS owned assets, such as containers, air-suspension trailers and dedicated trucks are utilised.

24

Such control minimises delays at border crossings, heightens security and gives assurance of reliable transit times.

Alan Miu, Regional Director – Customs Brokerage, Truck & Rail, explains the importance of his people’s input in achieving swift cross-border transits, “Our customs control tower solution gives peace of mind to our customers. A single GEODIS point of contact advises each of our clients before and during transits on customs and other necessary documentation, assisting with electronic lodging of declarations in advance to avoid delays. This hands-on care also makes customers completely aware of their shipment’s progress through GPS monitoring, contingency planning if necessary and final, ‘signedfor’ delivery.”

GEODIS in Asia Pacific, and indeed around the globe, understands the need to respond to the fast-moving pace of changing economic circumstances and the consequent demands on the logistics environment. “We believe that our client centric and employee driven approach provides the foundations of a successful future for GEODIS and our customers by adapting to the transformations

in the logistics industry that we are seeing,” comments Onno Boots, Regional President and CEO, Asia Pacific. “Our investment in, and operation of GRN, are prime examples of this philosophy in action. Its development has been led by identifying a gap in the market; it is enabled by good data communication and implemented by our dedicated people.”

As ever with GEODIS solutions, the benefits to customers are paramount. In GRN, GEODIS sees a product that reduces supply chain costs; enhances a client’s working capital by improving delivery times, which also optimizes assets by minimizing inventories and warehousing capacity. Ultimately customers are provided with a competitive advantage in order to grow their businesses.

PAYLOAD ASIA | Febuary 2020

APPOINTMENT

Pratt & Whitney appoi nt s new MD for India

Ms. Ashmita Sethi brings more than 20 years of experience from the defense and aerospace industry to this role and joins Pratt & Whitney following a distinguished career in corporate & public affairs, and communications with Boeing and Rolls Royce.

of India will bolster our support for our customers in the India market.

Ashmita brings the leadership, industry knowledge and experience to this role, and we welcome her to the Pratt & Whitney team.”

“I am excited very about the future of Pratt & Whitney in India, and this is a thrilling time to join this team,” Ms. Sethi said. “The GTF engine is the most innovative and competitive product in commercial aviation today, and Pratt & Whitney continues to innovate across all of its products and services to better serve its global customers.”

Carrol l Lane appointed President of Commercial Engines, Pratt & Whitney

Mr. Carroll Lane will be responsible for developing and implementing strategies that position UTC as a preferred investment to domestic and international investor communities.

Ms. Ashmita Sethi Pratt & Whitney, a division of United Technologies Corp. (UTX), announced the appointment of Ashmita Sethi to the position of Managing Director for India.

As Pratt & Whitney’s senior-most in-countr y leader, Ms. Sethi will provide strategic direction for the Company’s growth and business goals in India, and o drive all of Pratt & Whitney’s operations in India, including customer relations and support, the company’s Customer Training Centre in Hyderabad, .Communications and Governmental Affairs.

“India was an early adopter of the Geared Turbofan engine, seeing its potential to support growth in the commercial airline sector,” said Rick Deurloo, Pratt & Whitney’s Chief Customer Officer. “Having Ashmita join our team as the country head www.payloadasia.com | Febuary 2019

Carroll Lane Pratt & Whitney announced that Carroll Lane has assumed the role of President of the company’s Commercial Engines business, reporting to Pratt & Whitney President Christopher Calio. Pratt & Whitney is a division of United Technologies Corp. (UTX).

The appointment was prev iously announced during the UTC Earnings call in October.

Carroll Lane succeeds Mr. Calio in this role; Mr. Calio was named

President of Pratt & Whitney last year, succeeding Bob Leduc, who retired from the company after more than four decades of service.

Mr. Lane returns to Pratt & Whitney after leading Investor Relations for United Technologies Corporation, where he was responsible for developing and implementing strategies that position UTC as a preferred investment to domestic and international investor communities.

Mr. Lane first joined the UTC Corporate Office in 2012 as director, Corporate Strategy & Development.

In 2014, he transferred to Pratt & W h it ney a s t he sen ior d i rec tor, Customer Solutions, and served in positions of increasing responsibility including vice president, Commercial Aftermarket. Prior to joining UTC, he was a director with CSP Associates, an Aerospace & Defence advisory firm in Cambridge, MA. Mr. Lane served in the United States Marine Corps as a Naval Aviator.

Mr. Lane earned a bachelor’s degree in political science from Williams College and a master’s degree in business administration from the Harvard Business School.

New President and CEO takes the helm at Munich Airport

Experienced aviation expert will head FMG’s leadership team, Jost Lammers is also president of the Airports Council International (ACI) Europe.

Following the retirement of Dr. Michael Kerkloh, the long-standing President, CEO and Labor Director of Flughafen München GmbH (FMG), at the end of 2019, his successor, Jost Lammers, assumed his new duties.

Effective immediately, Jost Lammers will head FMG’s leadership team alongside managing directors Thomas Weyer (CFO and Infrastructure) and Andrea Gebbeken (Commercial and 25

APPOI NT ME NT

Jost Lammers Security).

With the appointment of the new CEO, Munich Airport remains in the hands of a seasoned aviation expert.

Jost Lammers (52), who was born in Oldenburg and grew up in Osnabrück in Lower Saxony, has held senior management roles at various European airports since the late 1990s.

After secondary school he initially entered vocational training with a bank before completing his military service with the German air force. He then studied business administration and economic sciences in Bayreuth, Wit ten-Herdecke and San Diego.

He g r adu ate d w it h a deg re e i n economics and began his career with an automotive supplier in 1994. Two years later he joined the German construction group HOCHTIEF AG, initially working in controlling and investment management functions.

With the transfer in 1998 to Hochtief Airport GmbH, he made his start in the world of airports, taking on responsible roles at various Hochtief portfolio airports. This included involvement in the commissioning and opening of

the new airport in Athens, for example.

In 2004 Mr. Lammers was appointed ma nag i ng d i rec tor of F lug ha fen Düsseldorf Ground Handling GmbH, a leading provider of ground handling services at Düsseldorf Airport. Four years later he was hired as the CEO of Budapest Ferenc Liszt International Airport. He remained there until the end of last year and made decisive contributions to the success of the airport serving the Hungarian capital.

Jost Lammers is also following in Michael Kerkloh’s footsteps at the international level: In the summer of last year he succeeded Dr. Kerkloh as the president of Airports Council I nter nat iona l (AC I) Eu rope, t he industry association representing the interests of Europe’s international airports. Jost Lammers is married and has two sons.

Seko Logistics appoints new Chief Growth Officer In his new role, Brian Bourke will

work closely with Terry Unrein, Chief Commercial Officer, David Emerson, VP Sales & Marketing EMEA, and SEKO’s global sales teams.

SEKO Logistics has promoted Brian Bourke to the new post of Chief Growth Officer. Responsible for the acceleration of SEKO’s organic growth, Brian will drive SEKO’s demand generation,

revenue management and corporate marke ting and communic ations initiatives.

In his new role, based at SEKO’s corporate headquarters in Chicago, IL., Brian will work closely with Terry Unrein, Chief Commercial Officer, David Emerson, VP Sales & Marketing EMEA, and SEKO’s global sales teams.

Brian began his career with SEKO in 2005 after receiving his BA in Economics from the University of Wisconsin. He later joined Geodis Wilson as Head of Marketing Communications, before returning to SEKO in 2012 as Vice President of Marketing. Speaking six languages and holding immense industry knowledge, Brian has been responsible for the internal and external communication of the many features and benefits of SEKO’s unique global logistics solutions. Brian has supported SEKO’s international growth, helping SEKO grow into a global network spanning over 120 offices in 40 countries.

SEKO Logistics expects another year of growth in 2020 as it extends its relationships with existing and new customers, and continues to pursue prime acquisition targets to bolster its omni-channel/e-commerce, white glove solutions and value-added forwarding services. In 2019, SEKO purchased Chicago-based customs brokerage and compliance consultancy, GoodShip International Inc. It also completed its largest-ever acquisition to date with the purchase of New York-based freight forwarder and cross-border ecommerce experts, Air-City, Inc., adding depth to its share of growing westbound airfreight and cross-border ecommerce trade for goods going from the U.S. to China. The move also strengthens SEKO’s U.S. import services with the all-important ‘Section 321’ and Type 86 entries that are critical for cross-border ecommerce into the United States.

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PAYLOAD ASIA | Febuary 2019

T REND S

Munich Airport reports 10th consecutive record-setting year passenger figures

projections, and despite a downturn in economic indicators, passenger traffic at Munich Airport will remain on course for growth in 2020. This trend is likely to gain added impetus through Lufthansa’s decision to station more A380 and A350 long-haul airliners in Munich and the resulting addition of new and attractive intercontinental routes.

Additional connections announced by the German carrier for the coming summer timetable period include a new flight to Bangalore, India, as well as services to the US cities of Detroit and Seattle. The Lufthansa subsidiary Eurowings is also adding Las Vegas and Orlando to its list of destinations.

systems (81%), recommended actions (69%), predicting gate volumes (59%), and stowage of vessels (52%).

In 2019, Munich Airport’s total traffic increased by 1.7 million, or 4 percent, to 47.9 million passengers. That was the largest increase posted by any German airport last year.

For the Bavarian hub, this result represents the tenth consecutive recordsetting year for total passenger traffic.

The number of take-offs and landings was up by around 1 percent to over 417,000 aircraft movements. Airlines substantially increased the number of destinations served especially in the intercontinental segment, which saw a year-on-year rise of over 6 percent in take-offs and landings to a total of approximately 34,000 and an impressive 9 percent increase in total passengers.

In European traffic, the passenger numbers were around 4 percent higher.

Meanwhile, the number of passengers on domestic routes within Germany again declined by around 1 percent.

These figures underscore Munich Airport’s growing strength as a hub.

Traffic flows to Asia and the Americas are increasingly being funnelled through Munich. Among the beneficiaries of this development are travellers in the airport’s catchment area, who can choose from among non-stop services to a growing number of long-haul destinations.

Running counter to the robust trend in passenger traffic, the cargo results at Munich Airport – in line with the global trend in the industry – were down in 2019. The 350,000 tons of flown airfreight and airmail handled in 2019 represented a 5 percent yearon-year decrease. Based on current

To p f i v e A I trends in shipping for 2020

Image recognition systems AI is being used for ship image recognition systems as part of a collaboration between Chinese tech company SenseTime and Japanese shipping firm Mitsui OSK Lines (MOL).

SenseTime’s system uses ultrahigh-resolution cameras and a graphic processing unit (GPU) to automatically identify vessels in the surrounding area.

It is intended to help improve safety and help stop large vessels colliding with smaller ones. It can also provide alerts to other hazards, particularly when visibility is poor. The image recognition technology could be used to monitor shipping lanes, as well as for security and coastguard operations.

Munich Airport outperforms all German airports in passenger growth, with a 9 percent increase in total passengers on long-haul routes.

www.payloadasia.com | Febuary 2020

Alexander Love lists down areas that artificial intelligence (AI) is beneficial to such as automated processes at shipping terminals and reducing fuel consumption.

The buzz around artificial intelligence (AI) continues to proliferate, with shipping companies beginning to explore AI’s potential in predictive maintenance, intelligent scheduling and real-time analytics.

GlobalData’s ship technology writer Alexander Love looks at five specific areas set to benefit from artificial intelligence in 2020: Automated processes at shipping terminals The shipping industry is growing in confidence at AI technology’s capacity to run processes at container terminals and expects it to play a big role in operations in the near future.

In a sur vey by Navis , 83% of respondents expect to increase their investment in AI technologies within the next three years. A large proportion of participants also agreed that AI could be involved in automating processes at terminals, such as container handling equipment assignments (81%), decking

Reducing fuel consumption Since 2018 Stena Line has been experimenting with AI tech on the Stena Scandinavica ferry, which travels overnight from Gothenburg in Sweden to Kiel, north Germany. The company has been collaborating on this project with tech firm Hitachi. Their tests have proven that the platform can provide fuel savings of up to 3%.

By the end of 2020, Stena Line plans to install the AI software on 38 of its vessels throughout Europe.

Navigation systems Navigation is one obvious area with potential for AI use in shipping and a number of systems are currently in development.

Orca AI is one such AI navigation platform being developed. The company’s solution combines sensors and cameras with deep learning algorithms. It is able to locate and track other vessels on the water and take action to avoid collisions.

Meanwhile, Wärtsilä subsidiary Transas’ Navi-Planner is an AI platform that uses machine learning to optimise voyage planning.

Stena Line has also developed its AI Captain solution for ship navigation. It is able to recalculate routes during voyages when it receives information to say there is an issue with the present route.

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T REND S Unmanned vessels Perhaps the ultimate goal for artificial intelligence in shipping is to enable vessels to operate unmanned. In September, the Mayflower Autonomous Ship (MAS) will leave Plymouth in the UK and head across the Atlantic to Massachusetts, US. It will be a very similar route to the one taken in 1620 by the first European settlers in the US, exactly 400 years previously.

Elsewhere in the industry, Yara Birkeland is an automated container ship being developed by Kongsberg and Yara. It is also fully electric.

One of the biggest issues with automated ships is economics. The sheer amount of tech required for a fully automated container ship isn’t cheap. The Yara Birkeland is estimated to cost around $25m, which is three times higher than a container vessel of equivalent size.

Air Freight D e m a n d Down 1.1% in November 2019

Despite the decline in demand, November’s performance was the best in eight months, with the slowest yearon-year rate of contraction recorded since March 2019.

The International Air Transport Association (IATA) released data for global air freight markets showing that demand, measured in freight tonne kilometers (FTKs), decreased by 1.1% in November 2019, compared to the same period in 2018. This marks the thirteenth consecutive month of yearon-year declines in freight volumes.

Despite the decline in demand, November’s performance was the best in eight months, with the slowest yearon-year rate of contraction recorded since March 2019. In part, November’s outcome reflects the growing importance of large e-commerce events such as Singles Day and Black Friday.

While international e-commerce continues to grow, overall air cargo 28

November 2019 (% yearon-year) Total Market Africa Asia Pacific Europe Latin America Middle East North America

World share1

FTK

100.0% 1.6% 35.4% 23.3% 2.7% 13.2% 23.8%

-1.1% 19.8% -3.7% 2.6% -3.4% -3.0% -1.1%

demand continued to face headwinds from the effects of the trade war between the US and China, the deterioration in world trade, and a broad-based slowing in global economic growth.

Freight capacity, measured in available freight tonne kilometers (AFTKs), rose by 2.9% year-on-year in November 2019. Capacity growth has now outstripped demand growth for the 19th consecutive month.

Regional Performance Airlines in Asia-Pacific, L atin America and the Middle East suffered sharp declines in year-on-year growth in total air freight volumes in November 2019, while North American carriers experienced a more moderate decline.

Europe and Africa were the only regions to record growth in air freight demand compared to November last year.

Asia-Pacific airlines saw demand for air freight contract by 3.7% in November 2019, compared to the same period in 2018. This was the sharpest drop in freight demand of any region for the month. Capacity increased by 1.8%. The US-China trade war has significantly affected the region, with demand on the large Asia - North America market down 6.5% year-on-year in October (latest available data). However, the thawing of US-China trade relations and robust economic growth in key regional economies are positive developments.

North American airlines saw demand decrease by 1.1% in November 2019, compared to the same period a year earlier. Capacity increased by 3.3%.

Slower growth in the US economy and trade tensions with China have affected demand. However, positive progress

AFTK

FLF (%pt)2 2.9% -2.0% 13.7% 2.1% 1.8% -3.1% 4.0% -0.8% -2.3% -0.5% 2.6% -2.9% 3.3% -1.8%

FLF (level)3 49.6% 40.4% 53.8% 56.9% 40.3% 49.7% 41.3%

in trade negotiations between both countries highlighted by the ‘phase one’ deal is a positive development.

European airlines posted a 2.6% increase in freight demand in November 2019 compared to the same period a year earlier. Better than expected economic activity in Q3 in some of the region’s large economies helped support demand. Capacity increased by 4.0% year-on-year.

Middle Eastern airlines’ freight volumes decreased 3.0% in November 2019 compared to the year-ago period – a significant improvement over the 5.7% decrease in October. Capacity increased by 2.6%. Against a backdrop of operational and geopolitical challenges facing some of the region’s key airlines, seasonally adjusted freight volumes in the region have continued a modest upwards trend which is a positive development for the region’s carriers.

However, escalated geopolitical tensions threaten the regions’ carriers in the period ahead.

Latin American airlines experienced a decrease in freight demand in November 2019 of 3.4% compared to the same period last year. Various social and economic headwinds in the region’s key economies have impacted the region’s air cargo performance. Capacity decreased by 2.3% year-on-year.

African carriers posted the fastest growth of any region in November 2019, with an increase in demand of 19.8% compared to the same period a year earlier. Strong trade and investment links with Asia contributed to the positive performance. Capacity grew 13.7% year-on-year.

PAYLOAD ASIA | Febuary 2020

Logis tic s

Multi-Skill D e velopment Centre of A l l c a r g o Logistics accredited with 5 star grading The 5 star category is the top-most status for a Skill Development Centre as per the current accreditation norms.

The Multi-Skill Development Centre of Allcargo Logistics, India’s largest endto-end private sector logistics solutions provider, has been accredited with the 5 star category by the National Skill Development Corporation (NSDC).

The Centre operates under the Pradhan Mantri Kaushal Kendra (PMKK) model and Pradhan Mantri Kaushal Vikas Yojana (PMKVY) flagship scheme of the Union Government’s Ministry of Skill Development and Entrepreneurship (MSDE).

Around 450 students had enrolled at the Allcargo Multi-Skill Development Centre. Under the PMKK initiative, 209 students have successfully passed.180 students have been placed under training to help them gain employment as consignment booking assistant, consignment tracking exe cutive, inventor y clerk , do c ument ation assistant and warehouse picker/packer

www.payloadasia.com | Febuary 2020

and improve their skill proficiencies in functional areas like warehousing documentation, booking, loading, unloading, tracking, MIS, picking and packing processes. The Centre has been successful in offering placement to 100% students. The number of eligible candidates qualifying to join as skilled personnel across diverse supply chain verticals only continues to rise.

Located at Bokadvira, Uran near JNPT, Navi Mumbai the Allcargo MultiSkill Development Centre is a stateof-the-art facility with a standalone G+2 structure comprising 40 rooms.

Spread across 45,000 sq. ft., it is located along the 40 ft. Panvel – Uran road and offers state-of-the-art infrastructure for classrooms and training laboratories measuring 400 plus sq feet. Trainers at the Centre are Logistics Skill Council (LSC) TOT certified.

SEKO Logistics acquires AirCity, Inc. The investment represents the latest

phase of SEKO’s program to accelerate its strategic vision by expanding its global footprint, establishing more strategic partnerships, and making accretive acquisitions.

SEKO Logistics has completed its largest-ever acquisition with the purchase of New York-based freight forwarder and cross-border ecommerce experts, Air-City, Inc. Similar to the purchase of GoodShip International Inc., which added depth and expertise to SEKO’s corporate gateway operation in Chicago, AirCity will immediately add additional resources and growth to SEKO’s key New York region. The investment represents the latest phase of SEKO’s program to accelerate its strategic vision by expanding its global footprint, establishing more strategic partnerships, and making accretive acquisitions that expedite the growth of its three core services; Omni-Channel Logistics, White Glove Services and Value-Added Freight Forwarding. In the past 18 months, SEKO has also acquired a majority shareholding in its strategic partner Omni-Channel Logistics Australia to further solidify and grow its eCommerce

and technology solutions for retailers, pure-play etailers, marketplaces and platforms.

Air-City was established in 1984, expanding to 15 offices worldwide, with New York as its head office. Air-City was among the first group of freight agents authorized by the China Government in 1994 and holds a certificate of approval for the establishment of enterprises in China.

The addition of Air-City will also build the capabilities of SEKO’s New York Gateway, which offers support to international shippers, by adding key facility infrastructure in the tight real estate market near JFK international airport. Further expansion of SEKO’s JFK operations will be announced in 2020.

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E XPR E S S & MA IL FedEx offers a range of delivery Enhancements options to Asia Pacific customers to match customer needs and expectations to F e d E x in the new digital era. Alongside FedEx International First, which is the option available to customers Inter nationa l fastest today, FedEx Express also offers FedEx Priority®, which delivers Fi r s t s e r v i c e International between one and three business days and FedEx International h e l p s A s i a worldwide, Economy® an option that ships between P a c i f i c two and four business days worldwide. b u s i n e s s e s DHL expands connect faster ocean transport to more markets online booking FedEx offers a range of delivery options to Asia Pacific customers to match service customer needs and expectations in the new digital era.

FedEx Express, a subsidiary of FedEx Corp (FDX) and the world’s largest express transportation company, helps Asia Pacific businesses connect to global opportunities faster with 14 new Asia-Pacific origin markets for FedEx International First® to the U.S. and Canada, bringing the total to 25 AsiaPacific origin markets.

As the fastest option within the FedEx international network, FedEx International First is a premium timedefinite, customs-cleared and door-todoor express service with a pre-defined delivery commitment for shipments up to 68 kilograms per package. More Asia Pacific customers can now have their international shipments delivered as early as 8 a.m. in 1 to 2 business days to nearly 5,000 zip codes across the U.S., 10 a.m. in 1 to 2 business days to Canada and Latin America, and 9 a.m. in 2 to 3 business days to Europe. Customers in Australia, China, Japan and Singapore also enjoy the delivery commitment of receiving shipments from the U.S., Canada and Latin America by 10 a.m. in 1 to 3 business days.

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The service myDHLi Quote + Book makes instant bookings for air and ocean freight as well as door-to-door shipments available 24 hours a day, 7 days a week.

DHL Global Forwarding, the air and ocean freight specialist of Deutsche Post DHL Group, has expanded its instant online quotation and booking service to DHL Ocean Direct FCL (full-containerload). The service myDHLi Quote + Book makes instant bookings for air and ocean freight as well as door-to-door shipments available 24 hours a day, 7 days a week.

It enables customers to compare available options and directly book

the best mode of transport, speed and rate. When booking a service, users can also choose a cargo insurance for their shipment and reduce their CO2 impact by selecting an alternative fuel or an offsetting option in just a few clicks. myDHLi Quote + Book is available in more than 70 countries. Until now, this service was already available for DHL Ocean Connect LCL (less-thancontainer-load), DHL Air Connect, and DHL Air Economy.

With a highly intuitive user interface, myDHLi Quote + Book allows instant access to air and ocean freight quotes based on minimal information. Thanks to these transparent quotes, customers can compare rates and lead times to select the best option for their needs. The integrated CO2Calculator automatically displays the carbon footprint for the shipment in comparison between air and ocean freight where available.

Furthermore, customers can save quotes and share them with selected recipients via e-mail or directly continue to booking. Quotes are valid for up to 30 days and can be accessed for booking at a later stage during this time. Customers can also easily choose to neutralize the carbon emissions of their shipments.

In the next step, shippers can either choose a clean-burning fuel for ocean freight or an offsetting option for any transport mode.

DHL Global Forwarding, Freight is continuously working on new services to offer its customers a state-of-the-art experience.

With a highly intuitive user interface, myDHLi Quote + Book allows instant access to air and ocean freight quotes based on minimal information.

PAYLOAD ASIA | Febuary 2020