Payload Asia | June - July 2021

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

THE TRADE MAGAZINE FOR THE ASIA-PACIFIC AND MIDDLE EAST REGION VOL. 39 JUNE/JULY 2021

POLAR AIR CARGO

ON FUTURE PROOFING THE BUSINESS

ARE YOU DIGITAL?

WITHOUT ECS

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EDITOR’S NOTE

EDITORIAL/PUBLISHER

In this issue, we are putting the spotlight on air cargo and logistics and the related businesses that are sharing the limelight together with the stakeholders of the supply chain. On page 14, express cargo carrier SF Airlines walks us through its operations as well as future plans to drive growth for Chinese parcel company SF Holdings.

In an interview, Ethiopian Airlines gives us a rundown of its cargo performance in China last year after it was awarded

by Guangzhou Baiyun International Airport. Turn to page 20 to find out more about the Chinese cargo market from the African airline’s perspective.

For our cover story, we talk to Lars Winkelbauer, EVP and chief operating officer for Polar Air Cargo Worldwide, as he shares the company’s future-proofing strategy amidst turbulent times, including its plans on digital transformation, engaging its workforce and keeping an eye on sustainability This issue also covers a special feature on the joint venture set up by ST Engineering and Temasek, and a brief chat with Lufthansa on its 777 freighter operations. Of course it won’t be complete without the latest industry news on our beloved airports, freight forwarders, cold chain operators, GSSAs and cargo handlers, including a brief interview with Hactl chief Wilson Kwong and TIACA chairman Steven Polmans. We hope you enjoy reading the pages, and look out for the MRO supplement coming this August.

Raymond Wong Publishing Director raymond@harvest-info.com Giullian Navarra PLA Editor editor-pla@harvest-info.com

OPERATIONS Mari Vergara Head of Operations mari@asiantvawards.com

MARKETING Franco Rafael Marketing Manager mktg@harvest-info.com

SALES Simon Lee Hong Kong, Europe and Middle East sales@harvest-info.com Chua Chew Huat Asia Pacific sales-sg@harvest-info.com Matt Weidner North America mtw@weidcom.com

TECHNICAL SUPPORT

Giullian Navarra

Michael Magsalin tech@harvest-info.com

Chief Editor

Harvest Information Pte. Ltd. 1100 Lower Delta Road #02-05-8, EPL Building Singapore 169206

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APRIL 2021

1

CONTENT PAGE

24

SPECIAL FEATURE Air cargo brings the party to conversions, aircraft leasing

NEWS

FEATURE

04 Changi Airport welcomes

14 SF Airlines maps out future

06 Malaysia’s newest cargo airline

16 SPEEDCARGO outlines next

07 ST Engineering, Temasek set

17 Lufthansa on what to expect

Tasman Cargo

starts scheduled charters

up cargo jet leasing venture

08 Air China, WFS extend 09

growth plans

stage of air cargo digitalisation when flying a Boeing 777 freighter

partnership in London, Frankfurt Kuehne+Nagel completes Apex acquisition

10 Bolloré names new manager for food vertical in China

11 JD Logistics adds air cargo

routes to Beijing and the US

12 Saudi-based private jet

operator to start air cargo services

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18

COVER STORY Polar Air Cargo talks about future proofing its business

29

INTERVIEW Real talk with TIACA’s Steven Polmans

INSIGHT 20 Ethiopian Airlines gives a

rundown on the Chinese cargo market

26 Jettainer’s Thomas Sonntag on outsourcing and transparency

COUNTRY REPORT 28 Australia’s forwarders urge gov’t to extend subsidy

CALL FOR CONVERSION SPECIALISTS AND MRO EXPERTS

WE ARE NOW ACCEPTING ADVERTORIALS AND AD PLACEMENTS

NEWS - AIRPORTS Changi Airport welcomes Tasman Cargo A new freighter operator will grace the runway at Changi Airport as it starts scheduled freighter services between Singapore and Australia.

Tasman Cargo Airlines, which becomes the 10th airline partner of DHL Express —and the first Australia-based freighter operator— at Changi Airport, will operate five weekly services on a route plying Melbourne, Darwin and Singapore

and back, aircraft.

using

its

B767-300F

Skyways Technics to expand MRO hub at SZB

overhaul (MRO) facilities, including an air frame hangar, component repair workshops, a parts distribution centre, and aircraft on ground (AOG) services.

Skyways Technics Group, a prominent international player for ATR and regional aircraft maintenance is set to expand its Asia Pacific hub at Malaysia’s Subang Airport as it looks to establish fullfledged maintenance, repair and

The Denmark-based company has been operating at the Malaysian airport since 2014.

Airport operator Malaysia Airports said the collaboration marks confidence from major aerospace players such as Skyways Technics to expand regional operations at Subang.

There are over 100 weekly flights mounted by DHL’s airline partners through Changi Airport, and the addition of Tasman Cargo should add much-needed air freight capacity between both countries, particularly for e-commerce packages funnelled through DHL’s hub at Changi.

Incheon Airport to open ‘cool cargo center’ this year Incheon International Airport is set to start operations at its newest cool cargo center this year, which will be operated by Korean Air, as it aims to improve the air hub;s competitiveness in the transport of temperature-sensitive cargo, particularly in the perishables sector.

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The airport operator anticipates the facility to add 55,000 tonnes yearly once the planned merger between Korean Air and Asiana is finalised.

It also predicts more cargo volume once travel restrictions are lifted with more people getting vaccine jabs.

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The airport ranked as the world’s third largest hub in cargo tonnage with about 40 percent of the total volume involving transshipment cargo. In May, it signed an agreement with Israel Aerospace Industries to establish a conversion facility for B777 converted freighters.

Move freight through IAH, and count on Houston to do the heavy lifting.

Houston — the energy capital of the world, the biggest city in Texas and home of the world’s largest medical center — invites you to expand your all-freighter service to George Bush Intercontinental Airport. IAH is ready in every way to help your airline load up the best air cargo opportunities. Contact us at HASAirService@houstontx.gov.

• 120-acre IAH Air Cargo Center • 600,000 square feet of warehouse space • Parking for 20 widebody freighters • On-site perishable-handling and fumigation facilities • Special expertise in handling energy-industry equipment • Connections to truck lines and 40 airlines • Ranks among the top three airports nationwide for import and export tonnage with Africa and the Middle East • Air Service Incentive Program

George Bush Intercontinental Airport

fly2houston.com

NEWS - CARRIERS Malaysia’s newest cargo airline starts scheduled charters Malaysia’s newest all-cargo airline Kargo Xpress has started operations with scheduled all-cargo charter flights using its first dedicated freighter, a B737-400F, with a capacity of up to 18 tonnes.

on 10 June. It will initially service the Kuala Lumpur–Kuching–Kuala Lumpur and Kuala Lumpur–Kota Kinabalu–Kuala Lumpur routes, with six weekly flights to each destination, from Tuesday to Sunday.

The aircraft, registered 9M-KXA and painted with face mask livery in honour of frontliners, made its debut from Kuala Lumpur Airport (KLIA)

Airline operator M Jets plans to induct another B737-400F and two B737-800F aircraft by the end of 2021, with additional four freighter aircraft in 2022. “These 8 aircraft will be connecting 25 domestic and international destinations. There will be additional aircrafts inducted yearly for the next 5 years till 2025,” the company said in a statement.

its air hub for Latin America routes, to transport 25 tonnes of Covid-19 diagnostic kits to the Dominican Republic.The flag airline has been using grounded passenger planes Korean Air’s converted Boeing 777- for cargo-only flights since last year 300ER freighter was used on the and has converted 16 passenger direct flight from Incheon to Miami, aircraft to freighters, including 10

B777s and six A330s, by removing passenger seats. It also installed cargo seat bags (CSB) on passenger seats of two B777s. Before this recent feat, the airline’s longest flight was its Incheon-Atlanta route of 12,547 km with a flight duration of 13 hours and 50 minutes.

Korean Air flies longest nonstop flight with ‘preighter’ Korean Air flew its longest nonstop flight since its establishment in 1969 using a passenger plane converted to a freighter. Cargo flight KE8047, which left Incheon Airport (ICN) on June 12 at 9:14 pm, arrived at Miami Airport (MIA) after flying 13,405 km for a duration of 14 hours and 42 minutes.

Raya Airways starts B767 freighter services to Nanning Raya Airways is now the first Malaysian cargo airline to offer freighter services to the southern Chinese city of Nanning in Guangxi, China. The airline will fly four times a week and expects to carry e-commerce products and consumer goods, including perishable items, offering an average weekly load of 30 tonnes up to 40 tonnes, using its Boeing 767-200F aircraft.

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The Malaysian carrier says it plans to expand its network to more destinations within Asia Pacific, including within China and other countries later this year. Raya Airways connects and operates scheduled air cargo services into major regional hubs, including China, Indonesia, Singapore, Vietnam and Hong Kong, as well as Kota Kinabalu, Kuching and Labuan.

NEWS - AIRCRAFT LEASING ST Engineering, Temasek set up cargo jet leasing venture In mid-May, ST Engineering announced that its wholly owned aviation asset management unit had entered into an agreement with Singaporean holdings company Temasek to set up a 50-50 joint venture for cargo aircraft leasing.

The move comes as e-commerce and air cargo volumes have resulted in growing demand for freighter

aircraft. The company expects to purchase passenger plane feedstock at lower prices with intention to finance older aircraft through a mix of equity and debt. It plans to build its portfolio to about US$600m (or about S$800m) within the next 5 years.The asset management team’s existing fleet currently has A320P2F, A321P2F and A330P2Fs.

ATRAN to lease 737-800BCFs from GECAS

linking Europe, China, Russia and order, GECAS is the largest customer the Commonwealth of Independent of the type for Boeing’s conversion States (CIS). programme. Equipped with CFM567B engines, the narrow-body 737-800 Having delivered 34 of the converted freighter can carry up to 23.5 tonnes of 737-800BCF and with more than 60 on cargo.

ATRAN Airlines has taken delivery of a 737-800 Boeing converted freighter (BCF) from GE Capital Aviation Services (GECAS), with a second slated to be delivered later in May to the scheduled express cargo carrier, part of the Russia-based Volga-Dnepr Group.

These aircraft join the two 737800BCF freighters ATRAN and GECAS announced in October 2018 and which entered service in March and October 2019, adding further capacity to ATRAN’s short- and mid-range routes

ST Engineering to lease five A321P2Fs to GlobalX

acquire five Airbus A321 passenger aircraft on its own or through joint venture companies and will provide maintenance services over the period of lease.

Global Crossing Airlines, also known as GlobalX, has signed up for five A321P2F conversions from ST Engineering, as the US-based startup charter service dips into the air freight market.

The A321 feedstock will be converted and maintained at ST Engineering’s global facilities, with the first plane to be converted in April 2022 and placed on lease in the fourth quarter of the same year. The Singaporebased company said the remaining ST Engineering, through its aviation four aircraft will be converted and asset management unit, will leased to GlobalX progressively.

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NEWS - CARGO HANDLERS Air China, WFS extend partnership in London, Frankfurt Air China has extended its cargo handling agreements with Worldwide Flight Services (WFS) at two key airports in Europe as the airline tries to capitalise on key trade lanes connected to the mainland. The Chinese airline has renewed its cargo handling contract at London Heathrow (LHR) to three more years, whilst it signed a 12-month extension with

WFS over at Frankfurt (FRA). Flights from London are currently operated by both B777 and A330 aircraft. Ex Frankfurt, the carrier offers both B777 passenger and freighter services. The new contracts further extend the mutual partnership between the two air cargo players in London, Paris CDG, Madrid, Frankfurt, Copenhagen, New York JFK, and Dallas Fort Worth.

dnata partners with Kale Logistics on e-commerce The emergence of ecommerce is spreading throughout the supply chain as air and ground services provider dnata has partnered with Kale Logistics Solutions to develop an e-commerce platform for the Dubai air cargo community. dnata is investing in upgrading its slot booking platform Calogi, launched in 2008, with appointment and customs services management through Kale Logistics’s digital solutions.

The online portal, built mainly for small and medium enterprises, can

be used by general sales agents, airlines, forwarders, 3PLs and ground handlers to trade in a paper-free environment.

through APIs and take advantage of all innovative functions while interfacing with their own system,” dnata said, adding that the platform will also help customers simplify existing processes “Customers will be able to integrate quickly and efficiently, without the the platform into existing workflows need to invest in multiple systems.

Swissport lands key contract extensions in Asia Swissport is growing its business in northeast Asia as it extended key contracts in Japan and South Korea with partner airlines and integrators.

The air services provider renewed its contract with Air France, KLM and Air Calin at Narita Airport (NRT) in Tokyo. Since June, the company has been providing cargo handling

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for Air France and KLM at Incheon Airport in Seoul as well as ground services for Air France at Tokyo’s Haneda Airport (HND).

Swissport is set to manage cargo volumes of 25,000 tonnes per year at ICN and will support two daily flights at HND. At NRT, the group supports a daily flight each for Air France and KLM and five services a week for Air Calin. Over in Korea, Swissport has extended its partnerships with Lufthansa Cargo, Cathay Pacific and FedEx Express Korea.

NEWS - FREIGHT FORWARDERS Kuehne+Nagel completes Apex acquisition Kuehne+Nagel has completed the acquisition of Chinese forwarder Apex International with a purchase price of more than US$1.2 billion (CHF 1.1 billion), adding significant forwarding expertise, particularly on the transpacific and intra-Asia routes. The forwarder says it will offer customers a ‘compelling’ value proposition in the competitive Asian logistics industry, especially in e-commerce fulfilment, hitech and e-mobility.

Kuehne+Nagel will take the majority of shares in Apex and the Swiss company years based on performance. In the first turnover, gross CHF 109 million profit will have the option to buy the quarter of 2021, Apex has continued to and earnings before tax of CHF 64 remaining shares over the next three perform strongly with CHF 556 million million, K+N noted.

Teleport bolsters network with full and converted freighters Teleport, the logistics venture of airasia digital, is further reinforcing its position as a main air logistics player in Asia with the operation of its first freighter, a dedicated 737-800F, as well as two converted A320 passenger planes, with seats removed for increased capacity.

The 737-800F will start operations starting the third quarter of this year and will operate out of the hub in Bangkok. Teleport says the additional

capacity will strengthen its route network between China, India and Southeast Asia and offer improved connectivity for its long-haul markets.

The two A320s, converted in house

by AirAsia subsidiaries, will be based in Thailand and Malaysia, operating out of Bangkok and Kuala Lumpur.

These preighters will continue their schedule to key cities like Hanoi, Ho Chi Minh City, Hong Kong, Jakarta and Yangon.

Hellmann to build new Auckland airport facility Full-service provider Hellmann Worldwide Logistics is investing 28 million euros with Auckland Airport to lease and develop a 19,200sqm ambient warehouse complex for multinational manufacturer

Techtronic Industries (TTI). The complex, located directly at Auckland Airport, will be commissioned in July this year and is expected to deliver a ‘new benchmark in efficiency, flexibility and functionality’ for Hellmann’s contract logistics services.The company is building a 16,000-sqm warehousing complex with 3,200 sqm of cantilevered canopy, to allow storage for 29,000 pallets of up to 10 pallet levels high.

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NEWS - COLD CHAIN Bolloré names new manager for food vertical in China Bolloré Logistics has appointed Julie Pirola as food & reefer product manager to lead the growth for the vertical in China. Julie has been in the food and reefer logistics industry for 10 years and has helped build solutions in cold chain management and international freight forwarding

for overseas producers, local importers, distributors and customs brokers. The new food & reefer product manager will be based in Shanghai and will report directly to Jean-Philippe Retif, commercial director of Bolloré Logistics Greater China.

Emirates extends pharma cool room at Dubai International (DXB) Emirates SkyCargo is further strengthening its pharma and vaccine handling capabilities in Dubai with the extension of its fully automated cool room with 94 airline pallet positions at its GDP-certified dedicated pharma facility at Dubai International Airport (DXB).

The extended cool room will provide an additional 2,600 square metres of temperature-controlled environment (2-25°C) for the storage and handling of

vaccines and other pharmaceuticals at the carrier’s purpose-built GDP certified facility. The new extension can hold an estimated 60 to 90 million doses of COVID-19 vaccines.

The Dubai-based airline has been at the forefront of the worldwide distribution of Covid-19 vaccines and has already breached the 75 million mark on more than 250 flights to over 60 destinations since late last year.

SATS buys major stake in Thai food manufacturer Food and gateway services provider SATS is set to buy Thai food company Food City for US$15.9 million ($21 million), the company announced in June. This will give SATS majority control or 85 percent of the food production company, which includes the 30,000-sqm Pathumthani food production facility. Following the acquisition, this facility will be configured to produce 90,000 readyto-eat meals daily. to increase productivity and reduce wastage. Once the transaction is SATS has been investing in large- finalised, the company will own scale kitchens and food technologies interests in 32 meal production

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facilities across Greater China, India, Indonesia, Japan, Macau, Malaysia, Maldives, Philippines, Singapore, and Thailand.

NEWS - EXPRESS JD Logistics adds air cargo routes to Beijing and the US JD Logistics has added a new air cargo route from Shenzhen to Beijing. The service, which started on 8 June, will use a B737 freighter to help shorten the fulfillment time in the Beijing-Tianjin-Hebei Area, and the Great Bay Area of Guangdong, Hong Kong and Macau.

The new route is operated by China Central Airlines and will fly between the two cities six times a week. The move follows a recently launched China to US service connecting

Nanjing Lukou International Airport (NKG) and Los Angeles International Airport (LAX) operated three times a week by China Eastern Airlines.

DHL Express dedicates flights to Ho Chi Minh, Penang DHL Express is making minor tweaks to its air network in Asia Pacific to meet the ecommerce boom that has spread across the region, particularly in Vietnam and Malaysia. The express service provider will now operate direct flights to Penang (PEN) from its central Asian hub in Hong Kong

(HKG), replacing the previous route the transit time to and fro the two main cities and add more capacity. connected via Ho Chi Minh (SGN).

The express operator is expecting It will deploy its A300 for the more outbound shipments coming Penang route five times a week from Vietnam and announced the and dedicate another A330 to serve upgrade of the B737-40 shuttling SGN six times weekly. DHL said the between Hanoi and Hong Kong to a dedicated flights aim to shorten B737-800.

Cainiao starts ZhengzhouBudapest air cargo link Cainiao Network launched direct cargo flights last week between Zhengzhou and Budapest, Hungary to meet the growing consumer demand in Eastern Europe. The service, which started on 14 May, will operate five times each week with 17 tonnes of capacity each day.

bureau and logistics partners, has developed a digitalised customs clearance system to cut the average process time to 6 hours, with Hungary becoming the first country Cainiao, together with local customs in eastern Europe to use the system,

the company noted. Chief strategist William Xiong said the company is committed to improving efficiency between China and central and eastern Europe and will offer its 10day delivery service at US$5 soon.

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NEWS - GENERAL Saudi-based private jet operator to start air cargo services Saudi-based private jet operator Aviation Horizons has chosen Airone Aviation Limited as its cargo sales agent to support its launch into the all-cargo market with regional 737 freighter services. The new air cargo operator already took delivery of its first B737-400SF conversion, with two more expected to join in the next three months.

Airone expects demand for the 737400, which has payload capacity of

18.5 tonnes with 11 ULD positions, to pick up, particularly for regular regional contracts in the Middle and Far East.

This is not the second all-cargo GSA contract awarded to Airone Aviation in the past 10 months after it got exclusive sales and marketing rights to AeroTransCargo (ATC) Moldova. It currently offers short- and long-term charter solutions as well as ACMI programmes with ATC’s growing fleet, which now has six B747-400 privately owned freighters. The GSSA said it is discussing hub-spoke opportunities to connect Aviation Horizon’s regional 737-400 cargo operations with AeroTransCargo’s feeder services from Hong Kong and China to Europe.

Luxury retail group to launch Vietnam’s first cargo airline Vietnam may see its first dedicated cargo airline by next year as luxury retailer Imex Pan Pacific Group (IPPG) submitted its proposal to the country’s civil aviation authority (CAAV) to establish an airline dedicated to freight transport. The conglomerate, through its subsidiary IPP Air Cargo JSC, will invest VND2.4 trillion (US$100 million) to develop its logistics capabilities and air network to handle both inbound and outbound shipments in Vietnam.

Luxury retail tycoon and IPPG chairman Johnathan Hanh Nguyen said the move to launch a local cargo airline comes amidst shipping woes for local exporters who are struggling with the higher air freight rates imposed by foreign carriers who hold over 80 percent of the market share.

PPG, a major shareholder in Southern Airports Services JSC and Cam Ranh International Airport Terminal JSC, plans to operate five cargo aircraft in the first year, then gradually increase to build five logistics warehouses at major Ranh, Da Nang, Can Tho and later Long seven aircraft in the second year and 10 international and domestic airports, Thanh, to bring goods from overseas to aircraft in the third year. It also plans to including Tan Son Nhat, Noi Bai, Cam gather at these hubs.

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COMPANY PROFILE for customers to move cargo in and out SIN and creating a network for other stations to funnel out their cargo due to the capacity crunch faced,” he added.

Syed Hadi added that market demand was particularly strong in 2020 due to uncertainty but has generally stabilised in 2021 as consumers and the aviation industry slowly accepted a ‘new norm’---one that saw higher rates across the board, particularly on US-bound routes.

Charter executed successfully with MH into MNL for an urgent project

P-Cube Aviation: Malaysia Airlines’ newly appointed GSA in SG The need for quick transport of urgent cargo, particularly during the height of the pandemic last year, has offered airlines a much needed revenue source as higher rates produced higher yields given the surging demand and lack of capacity.

As passenger traffic came close to a standstill with border restrictions and locked downs not only in Asia Pacific but across the globe, this resulted in grounded planes and with it the reduction of belly capacity that used to carry half of the air cargo transported around the world.

Operating against this backdrop, one Singapore-based air freight charter operator found an opportunity as cargo became the bright spot for much of the aviation industry. Its mission: ‘connecting the world’s logistics needs with our aviation expertise.’

thanks to forged ties with its airline partners. The company vision is to be the “industry preferred partner for cargo movement to destinations worldwide.”

“2020 was a very tough year due to the pandemic,” said Syed Hadi, managing director of P-Cube Aviation. “The only way to survive was to react and adapt to the everchanging market conditions. We saw an opportunity with the grounding of flights. This created a funnel effect in which there was an increased demand for cargo capacity due to the severely reduced airlines/aircraft operating,” he added.

For Syed Hadi, the modus operandi, which became its core business, was to find avenues for customers to move cargo in and out Singapore (SIN). “We started chartering flights to operate in India, Vietnam, Manila and Jakarta. We chartered the aircrafts With headquarters in the heart of and started offering to the market on the Singapore airport community at a per kilogram basis.”

SATS airfreight terminal 3 in Changi Airport, P-Cube Aviation managed to “We operated on a scheduled service stay resilient during the pandemic around the region creating avenues

What started as charter solutions has now evolved given last year’s success. P-Cube Aviation is now set to become the general sales and services agent for Malaysia’s flag carrier at Changi starting July.

“This will be our first airline product representation,” Syed Hadi noted.

“We duly hope that with our current team expertise and presence in the market that we further grow with Malaysia Airlines in years to come.

This will only be possible with the support and rapport garnered with our current forwarding agents working towards a mutually beneficial relationship,” he added.

P-CUBE AVIATION was established in 2018 in Singapore with the intention of providing air charter solutions to customers around the world. Backed by experienced air carriers, the company is committed to getting shipments delivered to destinations intended without any hassle or delays.

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FEATURE: SF AIRLINES

SF Airlines operated 45,000 flights and safely moved 830,000 tonnes of cargo, logging 100,000 hours, in 2020.

SF Airlines maps out future growth plans Regardless of what you know or what you may not know about SF Airlines, it still has the largest cargo air fleet in China. SF Airlines belongs to SF Holding, considered the largest integrated logistics service provider in China.

In a year when transport capacity congestion was seen throughout global supply chains, SF Airlines saw significant changes to its air network layout, which saw international volumes jump 400 percent versus the previous year. In total, the carrier operated 45,000 flights, safely moving 830,000 tonnes of cargo in 100,000 hours.

“In the initial stage of the pandemic, SF Airlines responded quickly, increased new capacity and added new flight

SF Airlines is the key strength to support SF to explore international business and strengthen international cross-border freight capacity

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routes in the subsequent months to provide rapid, stable and continuous air transportation guarantee for tackling the pandemic, resuming work and production and helping a recovering economy,” a company spokesperson told Payload Asia.

network and rapid expansion of the international market will be the key action items for the company. One of the major developments that the company is looking forward to this year is the opening of Huahu Airport, located in the inland city of Ezhou, in China’s central The airline expanded its service province Hubei. coverage from Asia and Europe to North America and added capacity by bringing The airport, developed together with three freighters to its fleet last year, Hubei province, will be the setting of an breaking the 60 mark. In mid-June, SF international logistics hub to serve as a Airline added another, a B767-300BCF throughway for packages destined for all-cargo freighter as the 66th aircraft. overseas, as well as SF Airlines’ operation centre in the future, the company Network expansion noted. SF Holding will contribute 18 With its flight network continuously billion yuan (US$2.7 billion) for the cargo expanding, the carrier expects its airport, which is expected to handle domestic and international air stations 3.3 million tonnes of cargo in 2030, to exceed 80, covering the US, Germany, putting it In fourth spot globally behind Belgium, Croatia, Japan, South Korea, counterparts Hong Kong Airport (HKG) Singapore, Thailand, India and and Memphis (MEM).

Kazakhstan in Asia.

Navigating the market According to the airline, continuous Amidst a pandemic, the airline improvement of the domestic air developed new flights based on

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FEATURE: SF AIRLINES temporary demands, including domestic connections to Wuhan to carry much needed medical and antipandemic supplies. Other routes include flights between Wuhan and Tokyo, Changsha and Singapore, and Shanghai and Zagreb.

As the largest freighter operator in China, the express carrier has extended beyond general cargo to transport electronics, manufacturing equipment and temperature-sensitive products like fresh products and pharmaceuticals, providing customised air freight service and supply chain solutions for these industries.

Aiming to further strengthen its logistical capabilities in the global market, the airline’s parent company SF Holding bought a major stake in Hong Konglisted logistics player Kerry Logistics Network. With the merger, the two will combine freight resources and a wide forwarding network to give full play to the Chinese parcel company’s advantages in international crossborder freight transport.

“SF Airlines is SF’s own freight resources, and is also the key strength to support SF to explore international business and strengthen international crossborder freight capacity,” a company spokesperson mentioned.

Digitally enabled for every scenario Looking ahead, SF plans to evolve into an independent third-party industry solution data technology service company that covers multiple industries and scenarios. To make this happen, SF has allocated over RMB 4 billion in technology last year, investing around 16 percent more than the previous year.

“SF Airlines increased the investment on technology and innovation in business scenarios of flight, maintenance engineering, operation control, ground handling, aviation materials and administrative management,” the company mentioned, adding that it established over 40 information management systems using automation and artificial intelligence to

The airline is working with Hubei province to build its own dedicated air cargo hub.

boost its development of the commercial market operations, including for aircraft of large UAV,” the company mentioned. maintenance, ground handling and flight operations control.

Enhancing the service level With the attention turned to cargo for The airline also participated in the first much of the aviation industry, most phase of a logistics public information people by now—particularly those platform developed by China’s civil within aviation—have learned about the aviation authority, which is said to value of air cargo to their businesses, promote information exchange for particularly in the transport of vaccines. the main stakeholders in air cargo and enhance the operational capacity of the SF Airlines said that, amidst capacity country’s air logistics sector. congestion as well as low level of informationization and supply chain Drones, anyone? integration, the industry is facing a key Over the years, SF has been looking opportunity to reshape the market beyond manned jets to carry parcels pattern and enhance the overall service and cargoes and has already invested in level. developing drones or unmanned aerial vehicles through its UAV tech “The growing demand of vaccine subsidiary Fonair Technology. transportation globally requires freight airlines to set up sound and complete It is reported that Fonair has developed vaccine transportation processes. After and introduced large UAV with the the passenger flights resume, the payload from 150 kilos to 3 tonnes and recovery of belly transport capacity may established an ecosystem that would distribute the cargo of the freighter, and allow the operation of large UAVs to the repeated fluctuation of the epidemic connect the long-haul and secondary will again test the freight airlines in line of SF Airlines’ logistics network. response to the emergency, which is also what we shall pay attention to,” the “In 2020, SF Logistics UAV has gained the company noted. trial permission of Guangdong-Hong Kong-Macao Greater Bay Area and has “The global airline industry will play an also started trial operations in Ningxia important role in vaccine transportation and Inner Mongolia. In the future, in 2021. As a member of the airline Fonair Technology will be committed to industry, SF Airlines will actively providing reliable solutions for logistics improve the abilities on the vaccine service in remote areas with smart transportation to get better prepared aviation technology and accelerating the for the next work,” it added

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FEATURE: SPEEDCARGO

SPEEDCARGO is using AI and robotics to automate the build up of cargo pallets for ground handlers.

SPEEDCARGO outlines next stage of air cargo digitalisation

test bed and has many advantages for a startup focused in the logistics industry.

He says, aside from government support, substantial investments in the research and startup space has created an environment where industry players are starting to seek innovative new technologies.

The air cargo and logistics industry is currently at the stage of digitalisation, and while the adoption may be nascent there are those who are working hard to accelerate the transformation beyond paperless trails and transactions.

“This mindset change facilitates easy access, ideas exchange and the ability to experiment fast. This is critical for the development and deployment of new technologies,” he added.

Singapore-based tech company Speedcargo knows the value of digitising paperwork and workflow management, but the company believes the next stage is capturing the digital information of cargo.

“An industry that is based on the movement of physical goods will need to digitise cargo that it handles and the infrastructure it uses to be able to drive optimisation,” said Dr Suraj Nair, founder and chief technology officer at Speedcargo.

the company says, extend across the entire value chain, including the airlines, freight forwarders and 3PL logistics service providers.

“Automation as a technology can be deployed across many of the current processes that exist in the air freight industry,” Suraj noted, adding that the solutions focus on compute heavy processes that cannot be undertaken without substantial training but can easily be done by a computer algorithm.

For instance, a flight plan that takes a human anything between 45 minutes to an hour takes mere seconds using its AI software CARGO MIND, whilst physical activities that require effort and potentially dangerous, such as lifting cargo, can be Industry solution automated using the gantry robot, aptly SPEEDCARGO, like most companies named CARGO ARM. in the city state, saw the country’s ageing workforce as an opportunity for Innovation mindset automation. The company, which spun In Singapore, Speedcargo works closely out of industry-funded research by the Civil with ground handlers SATS and dnata to Aviation Authority of Singapore (CAAS) and push the use of its AI and robotics solutions. the National Research Foundation (NRF), is The company recently partnered with now looking to develop technologies like AI Microsoft to explore the concept of creating and robotics to automate the build up of a digital twin for physical cargo. It also cargo pallets for ground handlers. wants to develop data-driven services for warehousing, freight forwarding, trucking Its cloud-based solutions aim to address and logistics, not just air freight ground digitisation, optimisation and automation handling, with Microsoft Azure. in handling cargo that are being loaded and unloaded from planes. The benefits, According to Nair, Singapore is an ideal

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Global perspective In addition, the mix of industry participants in Singapore provides any startup a microcosm of the global market whilst providing easy access to the entire logistics chain as a major trade hub in the Asean region.

“It has the presence of all the leading players as well as a good mix of niche service providers, giving a startup access to a mix of industries that reflects customers across the global landscape,” he continued.

Looking ahead, Speedcargo plans to lead the industry standard for digitising, optimising and automating cargo handling for the air freight industry in the next to 3 to 5 years and are looking beyond the city island.

“The nature of the industry we operate in is global, and if we want to be global, we need to provide solutions to the industry. Despite being a company that was launched at the peak of the coronavirus pandemic, we have had conversations with the industry in Vietnam, Hong Kong and Australia in the Asia-Pacific region; Israel, Turkey, UAE and Germany in EMEA; and in the US.”

FEATURE: LUFTHANSA

The twin-engine cargo aircraft can accommodate payload of up to 103 tonnes.

Lufthansa on what to expect when flying a Boeing 777 freighter Lufthansa announced in June that it was set to take in another factory fresh 777 freighter to add to its fleet by the end of this year. This would bring the German airline’s cargo fleet to a total of 15 full freighters when the aircraft commences service. Payload Asia got a chance to chat with Lufthansa about its cargo fleet and why the twin-engine Boeing 777F, with payload of 103 tonnes, is the ideal jet for its cargo operations

Lufthansa Cargo’s operations. Being the most efficient freighter in its class was one of the reasons why Lufthansa Cargo decided to move to a single B777F freighter fleet.

With a payload of 102. 8 tonnes, what types of special or unusual cargo have you been able to transport on the 777F? What about a 777 ‘preighter’?

We had a variety of special shipments on board our B777F freighters in the last few years. This goes from Panda From a pilot’s perspective, how bears to huge aircraft engines or many hours of simulated or flight urgently needed pharma shipments, training to be able to fly a 777F? such as COVID-19 vaccines in the The training for the various aircraft recent past. types is regulated by law and cannot be quantified in general terms. From a sales/commercial Lufthansa’s own requirements perspective, is it harder to fill for are even higher than the official cargo agents given that it has standards. more space? What can you say about utilisation of your current From an operations perspective, 777F fleet? is there any difference between Our B777Fs meet our customers’ flying 777F and other full requirements very well. With our freighters in your fleet in terms of flexible global network, we can maintenance costs, manpower, steer our offer along our customers’ regulatory requirements, etc? demand at any time.

Our B777F aircraft are ideal for

Would you consider the 777F a bang for the buck? What are your thoughts on fully converting older triple sevens similar to what IAI is doing? Is this a path your are likely to tread? Why or why not?

As mentioned above, our B777 freighters meet all our requirements and fit our operations very well.

Although we observe all possibilities and developments constantly, there is currently no alternative to our Triple Seven freighters for us.

How do you think airlines’ fleets and networks will evolve as more people get vaccinated? Will ecommerce be a main driver of the need for the 777F? Passenger flights are expected to return gradually during the course of the year. Nevertheless, freighter operations will remain important to catch up missing belly capacities and to ensure stable supply chains. The continuing growth of the ecommerce business is also expected. With our own subsidiary heyworld, which specializes in ecommerce transport, we are optimally prepared for all requirements to come in this branch.

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COVER STORY

Polar Air Cargo is a global air freight leader in time-definite, airport-to-airport scheduled air cargo services.

Polar Air Cargo talks about future proofing its business Whilst the media frenzy surrounding the transport and distribution of vaccines and much needed supplies has simmered down as of late, some air cargo operators are quietly and carefully mapping out their post-pandemic, future-proof strategies with the customer in mind. One operator taking the next step towards transformation is Polar Air Cargo Worldwide, which began its evolution prior to the pandemic and steadfastly continued throughout the past year.

its long-term strategy, which includes charging stations for airside electric vehicles and a brief comment on the prospect of drones.

What is Polar Air Cargo’s long-term strategy?

As part of our multiyear “future proofing” strategy, Polar is strategically engaged in digital transformation, workforce evolution and sustainability efforts. Our goal is to become the most customer-centric air cargo carrier in the world, powered by an engaged, forward-thinking workforce that leverages digitization to exceed expectations, and engages in sustainable practices to minimize our impact on the environment. Our “future proofing” strategy is supported by three pillars.

Ecommerce and express contribute to its business as an operator for DHL Express, along with raw goods and materials for manufacturers, and seasonal perishables.

Polar Air Cargo is putting its cold-chain management expertise to work in the sensitive air transport of pharmaceuticals, and achieved its CEIV Pharma certification Digital transformation: At Polar, the journey to digitization in May this year. is centered on rolling out integrated tools that make it easier for the crews to do their jobs, for customers to place and Payload Asia talks to Lars Winkelbauer, EVP and chief track orders, and for leadership to review true, good data operating officer for Polar Air Cargo Worldwide, as he in order to make even better business decisions. Digital shares what the industry certification means for the tools enhance processes allowing our teams to be more company, where it is investing its resources, as well as efficient with certain tasks like building up non-standard

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COVER STORY cargo loads; provide better visibility to our customers on the movements of their cargo; and overall reduce chance for error. For example, e-airway bills reduce the need for manual duplication of information as cargo can pass through multiple changes in custody over the course of its journey.

“Polarfied” workforce: Evolving how we train, how we empower our teams, and broadening the roles and skill sets we leverage, not only for the jobs of today but in preparation for the roles of tomorrow. The key to bringing about this Polar’s Future Proofing transformation is keeping the entire workforce involved and engaged in every step. Two-way communication with staff and the extended contractor staff teams is as important as relationships with customers and the care and custody of their cargo. Our new Polarfied training modules sharpen not only skills necessary for current processes and procedures but offer our colleagues the opportunity to deepen expertise, broaden knowledge, gain exposure to different areas of the business and industry, and provide access to various personal and professional development and growth resources.

temperature sensitive cargo—perishables like produce including cherries; and now we have achieved IATA CEIV Pharma certification, an industry standard that underscores our commitment to maintaining the cold chain during the transport of critical temperature sensitive cargo. The majority of outbound shipments are going intra-Asia, US and Europe.

What does the CEIV Pharma certification mean for Polar?

CEIV Pharma is a quality certification program developed

by IATA that has established high standards for safe air transport of pharmaceuticals around the world to ensure product integrity.

Polar’s CEIV Pharma certification affirms the company’s long-standing track record for successfully transporting temperature-sensitive goods like produce and other perishable commodities. I am immensely proud of the Polar team for achieving this industry-leading certification, underscoring our ability to maintain end-to-end temperature-controlled shipments across our network.

With the increase in demand for cold-chain transportation Sustainability: Taking responsibility for safeguarding tied to vaccines and the equipment needed for safe the environment is part of Polar’s DNA. We are focused distribution, our customers can continue to rely on Polar’s on sustainable business practices, reduction in carbon expertise around the world. emissions and improving environmental conditions around the world. Our efforts include operating a fleet of How do you see the air cargo industry evolving to meet energy efficient electric and hybrid vehicles on the ground, the future needs of customers? leveraging digital tools rather than paper wherever possible, From our perspective, customers want exceptional service, employee-led initiatives in our facilities globally—everything transparency into the movements of their cargo and from adjusting thermostats, installing energy efficient light they want to engage with sustainable, environmentally bulbs, stepping up our recycling efforts and planting trees responsible business partners. That is the crux of our in the communities where we live and work. journey to “future proofing”—all the steps we are taking in our long-term strategic plan are done with the customers’ Of course, this is all supported by investments in our facilities ultimate needs in mind. The digital transformation of our and infrastructure, including warehouse improvements and industry is critical to better serving our customers—it will expansions to meet the growing needs of our customers, provide better transparency, a better-informed network, investments in cold carts to further support perishable more accurate data in real-time, and ultimately drive the shipments including pharmaceuticals, and the installation most sustainable practices. of charging stations for electric vehicles.

Are airlines paying more attention now to cargo given Tell us about the company’s operations? What are your the current health crisis? typical routes/lanes?

I think passenger airlines have been paying attention to Polar Air Cargo is a global air freight leader in time-definite, cargo for quite some time. Carrying passengers in the cabin airport-to-airport scheduled air cargo service. We serve and cargo in the belly has been a good model for them, destinations around the world through regularly scheduled especially with the growth of ecommerce. Cargo has been flights, including Cincinnati (CVG), Los Angeles (LAX), New a healthy contributor to the bottom line for passenger York (JFK), Sydney (SYD), Seoul (ICN) Shanghai (PVG), Hong airlines for many years.

Kong (HKG), Bahrain (BAH) and Leipzig (LEJ).

Where is Polar Air Cargo in terms of flying unmanned What types of shipments are you moving the most aerial vehicles? Are you looking at the potential of volume of? And, where are the bulk of Asia Pacific drones for domestic or short-haul charters? inbound and outbound shipments going?

This is a great question—I think every forward-thinking As an express carrier, ecommerce makes up a big portion player in this space has to be thinking about this right of our business. We also carry fragile components and raw now. Of course, there are so many factors that have to be materials for a lot of electronics—the glass for example addressed before this is a reality—regulation will be critical. that probably makes up your smartphone or tablet screen. I for one am excited about the prospect of that chapter for In addition we are known for exceptional transport of aviation and the supply chain.

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INSIGHTS

Ethiopian Airlines gives a rundown on the Chinese cargo market It is no secret that bilateral ties between China and Africa have been a contributing factor for the success of air cargo operators moving shipments on this route. As the first African airline to establish a footprint in the mainland, Ethiopian Airlines knows a thing or two about the ins and outs of the Chinese market, and the carrier was recently recognised for its exceptional cargo performance at Guangzhou Baiyun International Airport. Payload Asia had a chance to gain insight on Ethiopian’s operations with head of cargo marketing Enquanhone Minyashal, as he shared how the airline is navigating the current pandemic and where it

plans to open new services to capitalise and 84 flights were with bellyhold on on the high yields. passenger aircraft

Our market is diversified and we still plan to gain our market share out of China specially to Africa, Europe, and North America.

Ethiopian demonstrated impressive performance at Guangzhou Baiyun International Airport by operating 1,622 flights, out of which 966 were with freighter, 572 were with preighters (passenger aircraft converted to cargo),

Ethiopian logged a total cargo weight of 54.4 million kilos at CAN last year. What makes the ChinaAfrica route a key lane or market for air cargo?

We are proud to say that flexibility and agility have always been our competitive advantage. Through our flexible business adjustment and active implementation of ‘passengerto-cargo’ flights and other measures, PPE and medical supplies were transported fast and efficiently from China to the rest of the world and viseversa.

Our state-of-the-art cargo terminal in Addis Ababa being equipped with advanced technology, compartmentalized cold chain facilities and temperature-controlled warehouses and all its well-trained employee’s capability makes it a chosen distribution hub for all humanitarian aid. We have always been actively involved in global aviation, tourism and e-commerce cooperation.

Previously, through our cooperation with Alibaba Group, we have joined in the work of building the eWTP platform and became an important partner in Africa. In addition, we have cooperated with Cainiao to open a cold chain transportation line from Shenzhen to Addis Ababa for the safe transportation of vaccines and other temperature-controlled goods.

Ethiopian Airlines has been committed to connecting China with the entire African continent for nearly half a century.

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INSIGHTS China is one of the strongest and oldest markets for Ethiopians. As the first African airline to enter the Chinese market, Ethiopian Airlines has been committed to connecting China with the entire African continent for nearly half a century. China and Ethiopia also have long-term and stable friendly relations. All these are important reasons why China-Africa is a key lane or market for air cargo.

What type of shipments are coming out of China and into Africa and vice versa? How are yields looking like with the imbalance of congested capacity and surging demand?

The inbound market from African side is almost zero and affects our roundtrip yield. Moreover, the entrance of more P2F by other airlines (OAL) makes the competition very tough.

This excess supply in the market can move the equilibrium price downward and affects our yield very badly.

Under the “Belt and Road” and ChinaAfrica economic and trade cooperation framework, Ethiopian Airlines makes full use of Addis Ababa, an important aviation hub in Africa, and plays an active role in promoting economic and trade exchanges and political and cultural exchanges between the Chinese and African people. Any item under this agreement is subject to our shipment.

The most common cargo from China are medical supplies, perishable products, high-value goods, technology, medicines and medical supplies, and goods from cross-border e-commerce.

Since the Covid-19 crisis began, air cargo has been a vital partner in delivering much-needed medicines, medical equipment (including spare parts/repair components), and in keeping global supply chains functioning for the most time-sensitive materials. At present, we have opened a vaccine line for the transport of Covid-19 vaccines between China and Africa, and Ethiopian Airlines will

continue to guarantee the safety of The state-of-the-art cargo terminal in vaccines and other medical supplies. ADD, which is the largest in Africa with annual capacity of around one million Which other key markets is the tonnes equipped with temperatureairline servicing right now? How controlled cold storage facilities has many aircraft are flying right now different climate chambers, covering dedicated to carrying cargo? When an area of 54,000 sqm; dedicated are you expecting to add more belly cool dollies; a dedicated pharma capacity? team, lease/handling of Envirotainer Our key market lanes are Asia (China, & DoKaSCH-TS active containers; realIndia)-Africa, Africa-Europe-Africa, time temperature monitoring system Asia-Europe-Asia and transpacific. and fully temperature controlled Currently we operate with 45-50 operation. The Pharma Wing of weekly flights from nine Chinese Ethiopian Cargo & Logistics Services stations and flying to all continents will continue to be the capable and except Australia. competitive airline for handling pharmaceuticals and all types of Our market is diversified and we still medical supplies. plan to diversify more and gain our market share out of China specially What would be Ethiopian’s take on to Africa, Europe, and North America. the current movement towards Subject to permit we are planning to sustainability? And what’s the add P2F flights from CTU, URC and CSX cargo division’s near-term plans to very soon. navigate the still ongoing crisis?

During the pandemic, Ethiopian made Currently, Ethiopian is operating a strategic change from growth to with 12 dedicated freighter A/C’s survival mode by managing costs, (three B737s and nine B777s) and 17 generating and controlling cash, preighters in its fleet, in addition to implementing prudent cost-saving passenger belly capacity, and we are measures and shifting focus from optimistic that things will get better passenger heavy to cargo business, in the near future both for cargo and including considering sea-air mode of passenger, which will open more for transportation to give an additional belly capacity. option for traders to move cargo between Asia and the Middle East to Can you tell us about the progress Africa, with faster delivery and cheaper of the vaccine rollout in Africa? cost How has Ethiopian supported the distribution and transport of these We hope that with our young, life-saving jabs? advanced fleet, our network across Our Cargo & Logistics Services, the Africa and our hub in Addis Ababa, multi-award winning and largest we will further connect the Chinese cargo network operator in Africa, market to the African continent. has announced its readiness with all required capabilities for the At present, we have nine freight stations distribution of potential COVID-19 in China, including Beijing, Shanghai, vaccine across the world. It was Guangzhou, Chengdu, Chongqing, instrumental in facilitating the flow Shenzhen, Wuhan and Hong Kong. of medical supplies, including PPEs, In the near future, we are planning across the globe in support of the to open a regular cargo route from fight against the COVID-19 pandemic Changsha, Urumqi to Addis Ababa. by deploying 12 freighters and 25 In the next step, we will continue to converted pax A/C into cargo. So far, closely monitor the aviation market Ethiopian Airlines has transported dynamics and make flexible business more than 27 million doses of vaccine adjustments accordingly. to more than 24 countries.

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C-SUITE INTERVIEW

Hactl broke records throughout 2020, at one time handling 16 flights simultaneously.

Hactl’s chief on turning 45: ‘efficiency is our middle name’ Hong Kong Air Cargo Terminals is turning 45 this year, and you can only imagine the wealth of expertise one can learn from, from an experienced player in the air cargo and logistics supply chain. Payload Asia got a chance to do a quick email interview with Hactl’s chief, Wilson Kwong, as he shared his thoughts on sustainability, innovation, and how to simplify cargo and ground handling for the world’s top airlines in Hong Kong through transparency and automation.

The vast scale of our operations means we have an unusual opportunity to fully automate processes that would not be viable for smaller operations.

service portfolio in order to support our customer airlines’ efforts to win market share. This is particularly important now that cargo has taken a lead role for many combination How is Hactl looking to get the job done this year? carriers.

Can you expound more on the company’s accelerated investment in personnel, IT and infrastructure?

How many airlines are you working with right now, and Hactl is 45 years old this year. Our history has been one of where are we seeing the volume in Hong Kong? Inbound investment and innovation from the beginning. We were or outbound? Regional or international? born of the need to make better use of the restricted space Hactl continues to serve around 100 airlines: that’s almost at the old Kai Tak Airport, and efficiency is therefore our certainly the largest customer base at any single location middle name. For this year, we will continue with the same globally. Our traffic profile has altered a little even in recent policies that have served us so well: proactively seeking out times, although there is slightly more focus on exports inefficiencies and resolving them through innovation, to largely due to PPE shipments since Q1 2020, and booming achieve service excellence, and constantly expanding our e-commerce.

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C-SUITE INTERVIEW Have you observed new route requests in HKIA for charters? What kind of coordination and expertise does it take to operate and work on such flights? What is the imbalance in supply and demand telling us?

There has been strong growth in scheduled and charter freighter movements since the beginning of travel restrictions removed so much linehaul bellyhold capacity.

We broke records throughout 2020 for freighter handling, with up to 120 flights per day, and up to 16 being handled simultaneously.

We view charters as a natural extension to our mainstream freighter handling business, and have operated a charter department for some years, whose function is to support first-time or occasional charter visitors to Hong Kong by providing guidance and assistance with operating rights etc.

It is likely that freighters will continue to play this increased role in the provision of global uplift: you need only look at the booming P2F s conversion market, and the number of carriers leasing or buying freighters or converting existing passenger aircraft.

What are the new innovations that have the potential to help automate and perhaps ‘simplify’ the processing to make it more efficient? Which other new tech or platforms do you think would drive the industry forward?

Hactl is very advanced in automation, so we are now focusing on AI in our repetitive admin functions and cyber security, and conducting early trials with robotics in order to gain competence ready for wider applications. The vast scale of our operations means we have an unusual opportunity to fully automate processes that would not be viable for smaller operations. In particular, we feel ramp vehicle movements and some aspects of loose cargo storage and retrieval are candidates for robotics.

Wilson Kwong, Hactl’s chief executive

On an industry-wide basis, we continue to campaign for greater use of digital processes replacing paper-based ones. To play our full potential role in e-commerce, we must embrace this concept to achieve seamless and visible information flows.

Hong Kong dropped down to second world’s busiest air cargo hub for 2020, despite a more than 7 percent increase in volume vs 2019. What’s your outlook for this year?

The growth of cargo at one US airport, which is the home base for a major domestic integrator, should not be seen as any lack of performance on the part of Hong Kong.

While we may currently not be able to claim the highest tonnage, we do have the widest spread of destinations, best choice of carriers and largest international traffic. As for the future, we see signs of recovery in general cargo and a boom in e-commerce and we expect to return to consistent growth.

What would be the ultimate path for cargo handling and aviation in terms of sustainability? Is it hydrogen, fuel, etc?

As a cargo handler, we are an interested observer of—but not an influence on—what happens in aviation as a whole. We focus on what we can control: our Green Terminal programme has seen massive reductions in waste, increases in recycling, reduction in energy use (for example, through our large rooftop solar farm) and banning of single-use plastics. We have won awards for our environmental policies and actions, and we hope to inspire our sector to greater efforts.

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SPECIAL FEATURE

ST Engineering is set to form a joint venture with Temasek to focus on introducing ‘new-generation freighters’.

Air cargo brings the party to conversions, aircraft leasing The relentless growth of e-commerce and a change in consumer behaviour, with more people buying online has created what some would say a renewed interest in purchasing freighters and converting older passenger aircraft for cargo use.

Whilst reports say 90 percent of freighters around the globe are Boeing jets, Airbus thinks its conversion programme for the widebody A330 and narrowbody jets like the A321 and A320 is set to take a piece of the former’s share in freighter operations worldwide.

In particular, the company is looking at the prospects of the A321P2F conversion programme which could easily rival its nearest freighter platforms. MRO and conversion specialist Elbe Flugzeugwerke GmbH (EFW), an Airbus joint venture

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with ST Engineering, is in charge of leading the overall programme and commercialisation, and the company believes the aircraft will be a ‘game changer.’

Since then, the group has delivered a second aircraft to lessor BBAM and secured orders for four from Dublin-based leasing company GTLK Europe. In December last year, EFW announced that it will start converting “The strength of the A321 is clearly A321s in China at ST Engineering’s its capability to accommodate fully facility in Guangzhou. containerised cargo on both decks—a game-changer in this freighter size Narrowbody, widebody or both? segment, and something which is With the unexpected impact of the not available on competing freighter coronavirus to operations, airlines platforms up to the B757,” said have been scouring ways to find much Thomas Centner, director sales for needed revenue, with some making aircraft conversion at EFW. the quick shift to focus on cargo which has been the bright spot over the last In October of last year, the company year. re-delivered the first converted freighter to aircraft lessor Vallair, its Whilst the Airbus narrowbody launch operator for the A321P2F freighters are ideal for domestic programme. The aircraft has since and regional cargo flights, EFW’s then entered service with Qantas who vice president for marketing and will be flying the aircraft for Australia sales, Wolfgang Schmid, is optimistic Post. about the potential of widebody

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SPECIAL FEATURE conversions. “On the widebodies, it might be a bit more on the A330300s because of the volume providing the space for ecommerce goods,” he mentioned.

narrowbody aircraft and the plan is to purchase passenger plane feedstock at lower prices with intention to finance older aircraft through a mix of equity and debt. With more feedstock expected over the next few years, EFW ST Engineering’s EVP/head of said it is happy to learn that conversion aviation asset management, Yip Hin and feedstock prices are meeting the Meng, agrees: “If you look at the expectations in Asia as well. widebody freighter market, with the last production 747-8F expecting to “In terms of obtaining long-term roll out in 2022 and the 767-300ER predictability and not willing to feedstock dwindling, it is inevitable profit from crises we sustain on our that attention will turn to the A330 and prices levels (of course escalated by the Boeing 777 both as a production the years). On the other hand, no freighter as well as a converted discounts are to be expected,” said freighter,” he noted.

EFW’s Schmid. On the widebodies, ST Engineering’s Hin Meng observed Whilst a suitable rival for the 777F in 20%-25% discounts on 15-year-old terms of payload capacity and long aircraft available for purchase, but haul capabilities is yet to unsurface, he warned that lessors may have to reports have hinted a possible A350 think twice before jumping on the cargo variant to go head to head with bandwagon. the twin-jet freighter. Right now the closest the concept has come was “The combination of the COVID-impact Asian Airlines’ decision to replace 283 asset valuation and the boom in air economy seats with cargo pallets on freighter demands are making cargo the cabin floor to firmly secure loads. conversions attractive. However, the process of selecting the right aircraft More feedstock, cheaper prices with the required specifications and With the growth seen by all-cargo the complicated nature of converting airlines and cargo divisions of a passenger aircraft into a freighter combination carriers, it was not too may not be the path every lessor is long before aircraft lessors and even prepared to undertake,” Min Heng investors started noticing. Recently, said.

ST Engineering, through its aviation asset management unit, announced Securing orders a joint venture project with Temasek Airbus predicts that around 1,000 to focus on leasing cargo aircraft. small freighter conversions will be Right after it secured orders from US- required over the next 20 years to based startup carrier GlobalX for five replace ageing fleets and cater for A321P2F converted aircraft. growth, which will make a solid market potential for the A321P2F programme.

“Both Temasek and ST Engineering Aside from the Guangzhou facility, ST saw the market opportunity for Engineering and EFW are setting up air cargo transport in the next additional conversion sites in the US decade arising from the growth of and Germany, which will ramp up e-commerce and express freight as world-wide conversion capacity for well as the impending retirement of the type to 25 slots per year by 2023. the aging freighter fleet, and wanted to be part of that growth story by In line with the foreseen demand, introducing more emission friendly, EFW in an interview recommended new-generation freighters,” explained talking to the company as early as Hin Meng. possible to assess the suitability of potential feedstock airframes. Whilst The joint venture will be focusing on the company doesn’t source the air

frames, it noted, customers are advised to source aircraft which come from the same original production batch.

This, the company says, will minimise variations and complexity within their fleet, compared with having different aircraft build standards.

“In principle all A321s can be converted to freighters,” said EFW’s Centner. “In order to avoid additional cost, the airframes sourced by the customers should ideally be the upper type-certified ‘weight variants’ (WV) and be equipped with the most recent avionics hardware and software. If this is not the case, upgrades can be installed which can be coordinated with Airbus’ and EFW’s respective upgrade services teams… In the end the feedstock selection depends on the ‘ramp price’ after conversion, so each business case is individual, he added.

Technicalities aside, ST Engineering said that converting older aircraft to fuel efficient freighters will provide an option for air cargo operators but more important would be the global emphasis on environmental sustainability and related legislations.

“The Temasek-ST Engineering JV will emphasise on, but not limited to, marketing pro-actively to ESG-focused operators with stated carbon footprint reduction targets and sustainability policies that align with at least the minimum standards and guidelines of internationally recognised industry associations and/or industry regulators,” Min Heng noted.

Jeffrey Lam, president/head of commercial aerospace at ST Engineering, expressed in a statement during the JV announcement: “We welcome and look forward to working with other potential like-minded partners who are looking to invest in the strong freighter aircraft leasing market. In the medium to long-term, the JV intends to securitise the leasing income streams by way of a business trust to unlock capital.”

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INSIGHTS: ULD MANAGEMENT

Jettainer’s Thomas Sonntag on outsourcing and transparency There are currently around less than a million unit load devices (ULDs) around the globe and the complexity of managing these cargo containers requires in-depth expertise.

Whilst larger airlines may have the infrastructure and manpower to manage their own fleets, Jettainer believes that there other ways for smaller airlines to access the same resources, sans the huge costs.

Payload Asia had the opportunity to talk to Thomas Sonntag, managing director of Jettainer, as he gives an overview of the ULD market and the advantages of having a reliable partner to take the operational and financial burden of managing these highly in-demand cargo assets What are the usual problems of airlines and other air cargo stakeholders when it comes to ULDs? How does Jettainer ensure there is enough capacity at a particular station or air hub?

ULD management is not a core

operation for airlines, and many carriers lack transparency about the cost of their in-house ULD operations.

But ULD availability remains vital to ensure the delivery of their core service—transporting passengers, luggage, and cargo—as planned.

Airlines cannot keep that promise without the right ULDs in the right place, at the right time. Since there are 900,000 ULDs around the globe, it is clear that managing them efficiently is very complex.

offerings and positioning for both ULD management and leasing?

The air cargo and passenger business has been very volatile and will continue to change. What hasn’t changed, though, is that airlines recognize the value of professional ULD management.

The overall ULD market is split: two-thirds of the world’s ULDs are managed in-house by carriers, the remaining third is managed by Jettainer or a market companion. We have identified different needs that At Jettainer, we steer each customer we serve with four different product with a dedicated ULD fleet that is offerings. optimized and priced to their exact requirements. We guarantee 100% First and foremost, demand for ULD availability thanks to our network, temperature-controlled ULDs has our unique combination of dedicated changed drastically during the teams and leading IT solutions, and Covid-19 pandemic.

Managing our smart pooling approach. this scarce resource is very laborintensive. We have bundled years How have customer expectations of expertise in our cool competence changed since the pandemic? How center and our product cool&fly. has this affected your product This service is unique and includes

Two-thirds of the world’s unit load devices are managed in-house by carriers, the remaining third by Jettainer or a market companion.

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INSIGHTS: ULD MANAGEMENT Were there any adjustments to your old business model, or any investments that you had to make?

We can confidently say that our business model has proven robust, crisis-proof, and of real benefit for our customers. Airlines appreciate our steadfast commitment to top-of-theline ULD management and the value of outsourcing non-core activities.

Thomas Sonntag, Jettainer’s managing director

complete order management, control, and positioning of cool containers, as well as monitoring and after-service management. In May of this year, Etihad Cargo intensified our long-standing partnership and adopted our new cool&fly service.

Besides our new product offerings, we continue to drive transparency forward. Transparency is the key to efficiency and effectiveness. We shed light on the supply chain and the entire lifecycle of each ULD.

We are, for example, forging ahead with the creation of digital counterparts for every physical ULD in our fleet. These digital twins pool data about every step within the ULD’s lifetime, are the base for automated decision-making, and Secondly, we serve startup airlines allow us to optimize the use of each and carriers ramping up operations ULD during its lifecycle. or running ad-hoc charters. They cannot invest in a fixed ULD fleet What are the trends that will drive because of inherent uncertainty and the air cargo industry to better fluctuations. They need flexible ULD heights? supply and can benefit from our Again, transparency. The industry short-term and long-term leasing lacks transparency and objective product lease&fly. measurement standards.

Many airlines have been asking for ways Thirdly, we cater to smaller airlines to judge operational performance. with fleets up to 2,000 ULDs. In the It is not easy for a single airline to past, they did not explore outsourcing measure its own ULD management this relatively small part of their performance against their current or business. But, in fact, the benefit for potential new service provider. them is significant despite the crisis.

Without ramp-up time, we take over In cooperation with the international managing their ULD fleet and help interest group ULD Care, we are cut operational costs by minimum fostering a transparency campaign 20% without compromising on our and developing benchmark figures to outstanding level of service—thanks do just this. The goal is to establish a to our plug&fly service. set of industry-wide key performance indicators, starting with a benchmark Last but not least, we take care of for the ULD loss rate. carriers with large ULD fleets, which face significant fixed costs. Our Secondly, sustainability. Every player product ULD Select handles their within the supply chain needs to entire ULD supply, leaving the carrier look at innovative ways to reduce the to enjoy huge efficiency gains and aviation industry’s carbon footprint. lasting cost savings.

With skypooling, for instance, we

offer a free-to-use platform to share ULDs. Users can resolve imbalances, eliminate empty transports, and return lost or found units—saving time, capacity, and CO2.

Another example is squAir-timber which we offer to the market. It replaces wooden beams and planks with a product made of cardboard fiber that is 80% lighter than wood.

A simple and cost-efficient way to lower the airline’s fuel and CO2 consumption, with an extra benefit: this choice eliminates increasing timber shortages and rising costs.

Aside from reducing costs, what other reasons should airlines consider before deciding whether they should outsource their ULD management?

Reducing explicit cost is one thing, but airlines need to avoid hidden costs. A potential loss of quality needs to be avoided. So, the first question is whether the service provider guarantees you 100% ULD availability with a robust business model, longterm stability, and a continuous focus on improving its own efficiency.

Jettainer is fortunate enough to have a strong and stable shareholder— creating continuity, and development opportunities for Jettainer and our customers. We work closely with almost 50 independent repair shops.

After all, maintaining and repairing ULDs is the costliest single item in ULD operation besides total loss.

Last but not least, efficient ULD management also helps make air transportation sustainable. As the industry expert, we manage our customer’s ULD fleets so that significantly fewer ULDs are needed, reducing tied-up capital, and storage capacities. Smart control, network synergies, and the use of lightweight ULDs helps us minimize transports of empty ULDs and excess weight— helping our customers save fuel, CO2, and aircraft capacity.

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COUNTRY REPORT: AUSTRALIA tight space availability and higher freight costs after September heading into peak season, saying there was already ‘too much freight fighting for limited space’ given the demand of e-commerce and the ongoing ocean shipping congestion.

“There are delays being experienced from some origins and through major transit hubs in Asia… Unfortunately, when backlogs occur there are instances where a carrier accepts an indirect shipment from an origin port and the first leg to the transit port/hub is confirmed, but the transit hub has backlogs and the connection flight decision is in the hands of the headquarters staff who usually prioritise loading the highest yielding cargo on the connecting flight,” he noted.

Paul Damkjaer, IFCBAA’s chief executive

Australia’s forwarders urge gov’t to extend subsidy Australian freight forwarders expressed concern about facing possible air cargo capacity shortages and higher rates unless a government subsidy programme, which ends in September, is extended. In a statement to its members, the International Forwarders & Customs Brokers Association of Australia said, “the general consensus is there will be an impact to space capacity and rates following the withdrawal of IFAM support, if no additional capacity is added.”

The Austrade International Freight Assistance Mechanism (IFAM) was set up during the onset of the coronavirus outbreak last year to support the cargo operations of airlines and to keep supply chains moving and help businesses in the country by defraying some of the transport costs.

The programme offers financial support to airlines to maintain flights and grants or discounts to shippers going around 30 to 35 percent to help offset the higher costs brought about by the imbalance in limited available capacity and surging demand.

For exporters in Australia’s horticulture, seafood, lamb, beef, pork and dairy sectors, this has become a lifeline to

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IFCBAA told its members to communicate with airline partners and their overseas offices and agents to make sure there is a confirmed-through booking for both flight legs. In a submission to an inquiry into supply chain vulnerability, the industry group said that the high freight rates make it prohibitive for lower value shipments, which leaves importers vulnerable when an ocean shipping lane fails or is delayed and airfreight is not a viable option.

“IFCBAA urges the government to continue funding the IFAM program sustaining their overseas markets, so the beyond September 2021 to provide question in everyone’s minds is what will continued stability of capacity and rates in happen once the subsidies are ended? the market for importers and exporters to access,” the inquiry read.

“The reality for exporters moving off IFAM support in September, is whether Since April of last year, there have been they can maintain their markets with 475,000 tonnes of product worth over less capacity availability, high freight rates A$6.8 billion (around US$5.16 billion) and 30-35% more freight cost,” said Paul transported via air freight under the IFAM Damkjaer, IFCBAA’s chief executive. “The programme. The cost of flights since extent to which they can do so, will affect the subsidy programme was started the available capacity in the market. is estimated to reach A$900 million or Those exporters who cannot sustain their around US$684 million by September. markets and withdraw will free up space on aircraft,” he added.

The Australian government implemented the subsidy scheme last year when Whilst current air freight rates are 2 to 6 commercial passenger flights plummeted times higher than over a year ago, Paul more than 90 percent almost overnight noted that carriers will need the total yield, following the coronavirus outbreak. It was subsidised by IFAM, to be shouldered by established with A$110 million, with a other exporters in order to continue flying. further A$241.9 million committed in July and another A$317.1 million in October to The idea is that the seasonality of extend it to the middle of 2021. In March, perishables may have an impact on Australia announced a further A$112.8 outbound yields, which would leave a million to extend the programme until question mark on whether round-trip the end of September. revenues will be sustainable for carriers.

With lower export revenues, airlines could IFCBAA said it has called airlines, cargo opt to withdraw capacity, which could terminal operators and freight forwarders ultimately spike up rates. for their feedback on the current situation and looking forward beyond September On the import side, Paul expressed when the government’s IFAM support concern for importers who will face ceases.

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C-SUITE INTERVIEW

Real talk with TIACA’s Steven Polmans

For an air cargo professional like Steven Polmans, there’s no such thing as a typical day. Between juggling his customer chief job at Nallian and his commitments as chairman of TIACA, Steven thrives in having different roles and responsibilities, one that he has learned to manage through years of experience. In a brief interview, Steven shares his view on new technologies, where the industry is headed, and the role TIACA is looking to play for air cargo and logistics.

How does a typical day go as Nallian’s customer chief and TIACA’s chairman? Where do you find the balance?

One of the fun parts of my job, something I also very much value, is the fact that there is not such a thing as a ‘typical day.’ And the combination of both, two completely different roles and responsibilities, only contribute to that. More than work-life balance, I am a believer of work-life integration. So TIACA chairman and Nallian’s customer chief, Steven Polmans finding the balance is not always easy, but over the years you grow experience and get better in doing this. You could How important is getting investor backing particularly also call it ‘getting old’ rather than gaining experience. for the startups developing these new tools?

Today, if you have a good idea and a solid business case, I do Can you describe TIACA’s vision for its current not think getting investors on board is the main issue. There membership? What’s the secret to activating new ones? is a lot of money in the market looking for good opportunities, We are not representing certain groups in or parts of the and logistics, partially thanks to the Covid pandemic, is getting aviation or air cargo logistics nor have a geographical a lot of attention from investors. But more than investors, it is limitation. This often complicates building a strong image market demand and an industry willing to change and adopt and clear mission, but at the same time gives us a unique new technologies that will be key. Each startup will need to position. Our mission is to support our members and work decide how much funding they need to get their idea on the with the industry and all stakeholders to advocate and drive market, but not all need huge capital to do so. change for a safe, profitable and united air cargo industry.

In order to make this change happen, we need to look at Across the air cargo supply chain, which segment do the logistical chain rather than part of it. Topics such as you think is ready for more automation and technology digitalization, innovation, sustainability, only reach their true investments to speed up the movement of cargo? Why potential when looked at from a 360° approach. So, it’s on so? those topics we really want to focus, as we can truly make a All segments are, no doubt! But with a different focus. And difference. Making a difference is how we want to convince the more manual labor is involved, the bigger the potential companies to join TIACA, not by being just another industry and the need. Airlines might focus more on the sales part, body doing the same things others are already doing. for handling agents it is on the operational part. I am also a strong believer that a lot of waste in our logistic chain is not What do you foresee are the new tools or tech that in the companies, but in the processes between different would propel the air cargo to even better heights? companies. And that is where more collaboration, to jointly As far as new tools and digital evolution, our industry is really benefit from the efficiency gains, will be necessary. The not making the progress it could or should make. Being very journey towards a good result might be difficult, but the gains critical, we also need to look at the good things. Many years afterwards will be bigger, for all involved. ago, we agreed on a common digital approach and our EDI messaging really allowed us to work efficiently together. Where do you see the air cargo and logistics industry Perhaps it was too easy, as it also stopped necessary headed, and what role is TIACA looking to play? evolution at a certain point. The fact we as an industry are I am convinced that our industry has a great future ahead not managing to get e-freight or even e-AWB to a good level of us and a unique strength of being able to cover the globe of adoption is a clear signal. So no need to be too innovative, in a very short time. But we are also a very diverse and small steps implementing existing tools in a smart way can fragmented industry. From a small niche forwarder or local already make a big difference. But it is good to see that at trucker to global e-commerce players organizing all aspects least the mindset is there to consider these applications of the process themselves. But there are a few things that will and technical solutions as an added value rather than an benefit our industry collectively: free trade, open markets, less operational hurdle you need to implement. Too often, protectionism, innovation and digitalization, sustainability— we still forget that change management is a much bigger items where nobody on an individual level can really make factor for success and improvement than is the technical a difference. This is where we, as TIACA, can and will be the component. organization making a difference.

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OPINION

To win the race against Covid-19, enabling access to vaccinations is key

LEONORA LIM

Vice President, DHL Customer Solutions and Innovation, Life Sciences and Healthcare

Digitalizing the supply chain helps countries with timely decisionmaking, from early warning of pressure points to ensuring endto-end supply chain transparency.

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When the first Covid-19 vaccine was approved for use in late 2020, it marked a momentous achievement in science. It was the result of an urgent and expedited development process that would have typically taken years. As scientists worldwide rallied together to develop nextgeneration vaccine technology, governments invested heavily in manufacturing infrastructure to shore up vaccine production capacities.

To date, more than 2.15 billion vaccine doses have been administered worldwide, according to recent data, yet the war against the coronavirus is far from over. The uneven distribution of vaccines, a decline in raw materials, and new, deadlier virus strains threaten to undo the good work.

Ten billion vaccine doses are required globally for high immunization levels by the end of 2021, but only four countries have achieved vaccination rates of 50 percent so far, while those with less-developed infrastructure continue to face challenges in the rollout.

The fast-changing global supply chain landscape is another factor.

The information sphere is constantly evolving - whether it’s the kind of vaccines approved by each country, the volumes required or the ideal temperature and packaging required. This means we need to adapt quickly and efficiently to meet changing demands.

To sustain the momentum of rolling out vaccines, the need for resilient supply chain networks, smart technology, and cross-border collaborations has never been more crucial. At DHL, we have developed our latest white paper Revisiting Pandemic Resilience, and here are ten steps that stakeholders need to put in place to support the great

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vaccine rollout and build a more resilient world.

1.

Establishing partnerships without borders While Asia was already in the cockpit of the supply race with millions of personal protective equipment (PPE) and test kits shipped out of China and South Korea, the delivery of vaccines has been a different ball game.

It is taking place on a different scale of distribution, and with strict temperature and handling requirements. Cross-sector and cross-border partnerships are necessary to address the urgent need for a viable medical supply chain for the vaccines.

Collaboration will help stakeholders align on the monitoring and delivery of vaccines and ancillary supplies.

For instance, the signatories of the UNICEF and World Economic Forum charter on Covid-19 vaccine delivery have offered pro bono support in the form of specialist logistics personnel for global logistics coordination, and operational assistance for warehousing and cold-chain solutions at regional and national levels.

Partnerships between the pharmaceutical industry, governments, and logistics players can help consolidate expertise under one roof. This means uncovering innovative new treatments, streamlining delivery mechanisms, and even preparing for future pandemics.

2. Building a supportive data backbone Data is king—even in vaccine distributions. Digitalizing the supply chain helps countries with timely decision-making, from early warning of pressure points to ensuring end-

OPINION

An integrated supply chain network with well-functioning return logistics will ensure the circularity of such packaging to be refurbished and reused.

to-end supply chain transparency.

For example, the DHL Express Quality Control Center looks out for shipment delays, identifies areas needing improvements, and takes proactive action to address them.

With data sharing protocols in place across different operating systems, supply chain stakeholders will get a holistic real-time view of the supply chain, which will help resolve bottlenecks efficiently to minimize disruptions.

3. Staying on top of transportation capacity Managing transportation capacity can save time and prevent unnecessary bottlenecks that may delay deliveries and compromise vaccine quality.

With vaccine distribution a priority for many countries, securing the right transportation capacity at the right time is vital for the successful delivery of vaccines that may have varying requirements, such as temperature control. Tools such as the DHL Ice Tracker can track the quantity of dry ice that will be uplifted, ensuring that it does not exceed the stipulated limit for the safety of the aircraft and crew.

4. Putting the ‘green’ in packaging Most approved vaccines have cold or ultra-cold storage temperatures that require special packaging systems, which can be expensive. Ensuring the reusability of packaging will reduce wastage and costs over the long

term. For instance, temperaturecontrol packaging solutions provider Softbox developed a specialized reusable ultra-low temperature (ULT) shipper to support the distribution and storage of ultra-low temperature vaccines. The reusable box, built with high-performance insulation materials, can be topped up with dry ice for ultra-low temperature control to store vaccines for up to 30 days.

An integrated supply chain network with well-functioning return logistics will ensure the circularity of such packaging to be refurbished and reused, reducing packaging waste by up to 50 to 60 percent.

5. Setting up strategic warehousing Moving and storing vaccines adequately is just as important as administering them, as incorrect implementation can lead to wastage.

Unfortunately, in these pandemic times, wastage can come at a high cost.

Up to 70 percent of health facilities in low and middle-income countries are ill-prepared to store large volumes of Covid-19 vaccines at the optimum temperature. According to readiness assessments conducted by the World Bank last year, just over 50 percent of countries assessed had the cold chain capacities needed to deploy vaccines, based on the cold chain capacity for regular temperature vaccines.

One solution to mitigate the lack of ultra-cold infrastructure locally is to implement the supply chain archetype of direct shipping to the point of use without cross-docking or repackaging. For larger countries, governments can explore setting up appropriate storage locations at local or regional levels. This includes taking into account factors like the cost and future utilization of large-scale cold-chain storage and warehousing.

6. Ensuring synchronized flow of goods Vaccines and ancillary supplies like needles, syringes and diluents go hand in hand. To ensure maximum

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OPINION increasing people’s knowledge of the pandemic and changing their attitudes towards vaccines.

One successful example is Rwanda’s Ministry of Health. It launched a successful vaccine rollout with the help of wide-scale communication efforts via Twitter, television, and radio, based on personalized updates for vaccination priority groups and the influence of community leaders.

Vaccinating the public means leaving no one behind. This means offering incentives or helping to alleviate the associated costs that might deter the public from signing up.

efficiency, ample consideration must be given for ancillary supplies that need to be shipped and stored either jointly or separately, depending on the local infrastructure, logistical capabilities, and the availability of medical supplies.

In the mountainous kingdom of Bhutan, vaccines and ancillary supplies were combined upon arrival in the country before being delivered to remote locations by foot or helicopter. As a result, over 95 percent of the adult population has received their first shot.

7. Providing easy access to vaccination points The accessibility of vaccination sites can make or break a vaccination campaign. Depending on the overall demand and size of the country, vaccination points should be located in areas that allow seamless patient and logistical access. The United Arab Emirates, for instance, can administer the vaccine at any of its 205 vaccination locations across the country. It has since emerged as one of the fastest countries to roll out vaccines worldwide.

8. Educating the population Vaccine education can save lives.

As a key part of all health systems, community-wide education on the benefits of vaccinations can help people make informed decisions about their health. This means

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9. Implementing a user-friendly process A seamless vaccination process can help improve vaccine sign-up rates.

This means creating centralized registration and scheduling based on clearly defined criteria like age, profession, or immunity to the virus.

Setting up vaccination locations with minimal barriers to access will also be essential.

10. Offering incentives for the last movers Vaccinating the public means leaving no one behind. This means offering incentives or helping to alleviate the associated costs that might deter the public from signing up. In some countries like Thailand, fully vaccinated people face fewer travel restrictions—the island of Phuket is expected to open its doors to vaccinated travelers. Some possible measures to boost vaccination demand include offering paid sick leave or free meals and vouchers to encourage vaccination.

Preparing for the next crisis This public health crisis was not the first, nor will it be the last. Around 7 to 9 billion vaccine doses and corresponding ancillary supplies are expected to be distributed annually between 2022 to 2023. To succeed, all stakeholders must be prepared for high patient and vaccine volumes, maintain their logistics infrastructure and capacity, and plan for seasonal fluctuations.It is vital to build a welloiled supply chain system that can stand up to this pandemic and the ones that will follow. Collaboration will be critical to this effort.

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Payload Asia