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08/04/2019 12:48
The weekly newspaper for air cargo professionals No. 1,043
5 August 2019
Digitalisation cannot be stopped
Weakness in Asia hits Lufthansa Cargo profits
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rofits in Lufthansa’s logistics business segment slumped by almost 90% in the first half of 2019 due to weakness on routes to Asia. Profits measured in adjusted earnings before interest and tax (EBIT) was down 88% to €15 million. In the second quarter of 2019, the segment fell into a loss of €9 million compared to €55 million in the same period of 2018. First half revenue declined 5% to €1.2 billion and the second quarter dipped 6% to €622 million due to pricing and volumes falling, especially on routes between Europe and Asia. Load factors were down 6.1 percentage points in the first half of 2019 to 61.1% and by 5.3 percentage points to 59.7% in the second quarter.
Page 6
INSIDE atlas air grows in kentucky
atlas Air Worldwide Holdings will expand operations in Kentucky with the opening of a global operations centre in Erlanger ... page 2
air india to use digistics
The freighter fleet is being upgraded with two new Boeing 777 Freighters for Lufthansa Cargo in the spring, and one for AeroLogic. In response to weaker market demand, Lufthansa Cargo is reducing the use of MD-11Fs, with two due to
retire by the end of the year. Other highlights for the year include Lufthansa Cargo extending its cooperation with Cathay Pacific on route between Europe and Hong Kong. A new subsidiary called heyworld offering tailored solutions for the
fast-growing e-commerce business has also been established. Lufthansa Group says the outlook for the logistics segment with Lufthansa Cargo is a full-year margin of 3-5%, dependent on demand stabilising in the fourth quarter.
ACS skydive raises £9,000 for charity
Eleven Air Charter Service employees raised almost £9,000 by skydiving for children’s charity Momentum. The charity supports families with children facing cancer or other life-challenging conditions across South West London, Surrey and West Sussex. Glenn Phillips, PR and advertising manager at ACS, who was one of the brave 11 employees says that while they were apprehensive, they knew it was for a worthy cause. They used a Cessna Super Cargomaster, the freighter version of the 208 Caravan for the skydive, and jumped from 10,000 feet. Phillips says: “From inside the aircraft you could see out over the landscape, but there was no time to take in the view as you were shuffled to the edge of the
cargo door – this was the scariest part!” He adds: “But, once falling, it was incredible – hurtling at more than 120 mph towards the ground was an experience I will never forget! After around half a minute my instructor pulled the cord and the parachute opened. Then we glided down and I finally had the chance to take in the beautiful Wiltshire scenery.” Nicola O’Donnell, corporate fundraising manager for Momentum says: “The ACS team’s fundraising is amazing, I cannot thank them all enough! They have made a huge difference to families who have a child with cancer or life limiting illness.”
air India will use the Unisys Digistics logistics software suite to create a connected and automated cargo ecosystem for consistent and accurate ... page 4 brexit ready or not
associations representing the UK’s freight industry have warned that the logistics sector is not ready for a no-deal Brexit ... page 5
driving the sub-sahara
in the four years since HAE Group started operating in South Africa, growth has continued at double digit rates says director Neville Karai ... page 10
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01/08/2019 14:06
Old Words
During August, we are looking back at old editorial comments that were once a feature of Air Cargo Week
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irfreight was in limbo at Swisscargo last week as the entire Swissair fleet was grounded by a lack of cash. Televised news reports and radio Strong peak season programmes shot the information around the world as the Swiss public absorbed the news that their flag-carrier, the home airline of the world’s leading financial institutions, its bankers and financial gnomes, couldn’t pay the bills and its aircraft had stopped flying. There are different philosophies on what it takes to make a successful country with a good image - but a strong start is always a powerful financial base, tuneful national anthem, and a well-designed flag. Then you need an airline to carry it - a national flag carrier. For decades, Swissair has proudly carried the Swiss flag emblazoned on its tail. Its appearance at world airports drew attention to Switzerland - and then, last week, its absence drew plenty of unwelcome attention to the fact that Switzerland, of all places, couldn’t come up with the cash to meet its commitments. Swisscargo will set to work on strenghtening its image. That wil not be too hard a task for a much-respected cargo carrier. However, it is the public image of Switzerland that has been shattered by the worst corporate failure in the country’s business history. The whole affair has left the Swiss with an enormous image problem. In the European Union, of which Switzerland is not a member, government handouts like the one produced last Thursday to get Swissair back in the air, are not allowed by law. Here, at least two other European flag-carriers are sitting quietly, hoping that life gets better before they are forced down the same path towards a goverment hand-out that can’t be legally provided. 8 October, 2001
WFS leases extra facility in Copenhagen
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orldwide Flight Services (WFS) is future-proofing cargo operations at Copenhagen Airport by leasing a further facility to support airline and freight forwarding customers. On 1 September, WFS will commence operations in an additional 4,700 sq m freight centre at the airport, increasing its total footprint in Copenhagen to more than 13,900 sq m. Located next to the existing premises, it will increase WFS’s capacity to serve 70 customers, including 23 airlines with online flights to the Danish capital. The latest development is part of an ongoing investment programme in Copenhagen where WFS will also open a new pharma facility in the coming weeks, one of its biggest growth areas in Denmark. The additional building has six ramps
Asia keeps falling Air cargo is continuing to struggle in June with a 7.2% fall in demand, the Association of Asia Pacific Airlines (AAPA) reports. Demand in freight tonne kilometres (FTK) was down 7.2% to 5.8 billion and between January and June, demand fell 6.2% to 34.3 billion. Andrew Herdman, director general of AAPA says: “Asian airlines recorded a 6.2% decline in air cargo demand, reflecting prevailing weakness in international trade flows across regions, as widening trade disputes and higher tariffs continued to disrupt global supply chains. With moderating global business optimism levels and the absence of significant progress in trade negotiations, air cargo demand is expected to remain weak.”
Quote of the week “The big movements are coming for the holy trinity of IAG, Lufthansa and Air France. They decided to open the service through APIs and channels like WebCargo” Manel Galindo, CEO of WebCargo by Freightos on how digitalisation will change the industry Read the full interview on page 6
and cargo doors, two cool rooms as well as dedicated rooms for AVI and RRY storage, and benefits from direct airside access. Marc Claesen, senior vice president Northern Europe for WFS says: “This expansion of our capacity gives us the
opportunity to achieve a more optimal flow of cargo through our operation to benefit our customers, and will provide the potential for future growth as our existing customers increase their volumes or new airlines commence services.”
Jost Lammers will take over as president and CEO of Munich Airport, succeeding Dr Michael Kerkloh who is retiring on 31 December 2019. Lammers, who is CEO of Budapest Airport will start his five-year term on 1 January 2020 and has had a long career in the aviation industry. In his long career in aviation, Lammers previously served as CEO of Flughafen Dusseldorf Ground Handling and as an asset manager at Dusseldorf Airport with Hochtief AirPort, and as a project manager for Athens Airport. In addition, Lammers was elected pres-
ident of Airports Council International Europe in June and is a member of the supervisory board of Hamburg Airport. Albert Furacker, Bavarian minister of finance and the chairman of the Flughafen Munich supervisory board says Lammers is an excellent choice, having led Budapest through a period of growth and development. He says: “We have therefore selected a candidate whose experience, skills, personality and age make him the ideal choice to lead Bavaria’s Gateway to the World into the future and successfully master the many challenges that lie ahead.”
Lammers to take over as Munich CEO
Born delays departure from Swissport again
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Eric Born has delayed his departure from Swissport for another year subject to successfully refinancing the company’s debts. The president and CEO of Swissport International was due to leave at the end of this year but subject to successful refinancing by 30 September 2019, he will stay until the end of 2020. He was initially going to stand down at the end of 2018 before agreeing to stay on until 31 December 2019, then further postponing his departure for another year. Swissport Group, indirect parent company of Swissport International, Swissport Financing and Swissport Investments, intends to refinance some outstanding debt with new senior credit facilities and new notes. Refinancing will consist of a new €75 million revolving credit facility, a new €50 million delayed draw loan facility, an aggregated principal amount of €1.2 billion across a new term loan B facility and offering new euro denominated senior secured notes, along with €280m of new euro-denominated senior notes. Swissport has also released preliminary financial results for the first half of 2019, with revenue increasing 6.1% to €1.5b and operating EBITDA growing 7.3% to €121.9m. Second quarter revenue was up 3% to €776.5m and operating EBITDA dipped slightly from €76.4m in 2018 to €76.2m this year.
aircargoweek.com
01/08/2019 14:09
Atlas Air to extend Kentucky operations
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tlas Air Worldwide Holdings will expand operations in Kentucky with the opening of a global operations centre in Erlanger. The facility is located near Cincinnati/Northern Kentucky International Airport and having secured a long-term lease, it is expected to open in 2021. Atlas Air employs 318 professionals, including 182 Kentuckians at facilities in northern Kentucky including the Southern Air subsidiary. Employees from the Florence location will relocate to the Erlanger site once it is complete. Kentucky governor Matt Bevin says: “We are honoured to support Atlas’ growth on a global scale and appreciate that Atlas recognises what we know in the Commonwealth: Kentucky is an ideal partner for dynamic, growing companies.” William Flynn, chief executive officer of Atlas Air Worldwide says: “Our new operations centre in Erlanger will enable us to continue
DB Schenker 4.0 comes to the US
Durham Tees Valley Airport has reverted to its previous name of Teeside International Airport. The name comes after the airport, located just outside Darlington in County Durham, was brought back into public ownership. Tees Valley mayor Ben Houchen paid previous owner £40 million to take control of the airport in March, and it will now be operated by the Stobart Group.
to deliver high-quality services to our customers and support their growing global networks. We look forward to the development of a modern, state-of-the-art facility that will foster a great sense of pride with our existing and future employees.”
IL-76s destroyed in drone attack
A year after its launch in Europe, DB Schenker is opening its 4.0 Shipping Portal to customers in the US. The portal offers shippers a more user-friendly interface for booking and managing shipments. It goes beyond the eSchenker platform, allowing shippers to get a quote for an air or ocean shipment, book and track the shipment from pickup to delivery. Jeff Barrie, CEO for DB Schenker USA says: “All things being equal, small to medium size businesses now can get a quote, book and track a shipment with full online visibility from pickup to delivery using air and ocean transportation singularly or as a combination of services offered.” Richard Ebach, CIO Americas for DB Schenker says: “The Connect 4 application was designed from the customers’ point of view, the goal was to create responsive and intuitive designs that provide immediate quoting, booking and tracking functionality that is expected from a leading digital forwarder.”
Two Ilyushin IL-76s have been destroyed in a drone attack at Al-Jufra Airbase in Libya, killing the captain of one of the aircraft. According to Aviation Safety Network, the Libyan Air Force under the government of National Accord carried out multiple drone attacks at about 04.00 on Thursday 25 July. The aircraft UR-CMC manufactured in 1991 and UR-CRP manufactured in 1992 belonged to Ukrainian airline Europe Air. The captain of UR-CMC died in the attack, reportedly trying to save his on-board documents. The Libya Observer says the Libyan Air Force destroyed an ammunition depot and the aircraft, saying they were being used for Khalifa Hafter of the Libyan National Army’s armed groups. The air base is under the command of the Libyan National Army, which has been in conflict with the international recognised Government of National Accord since late 2015. On 27 July, the State Aviation Service of Ukraine suspended Europe Air’s Air Operator’s Certificate, according to Kyiv Post. It says the decision was taken by the permanent commission on the certification of operators.
Tyrolean titfer for thirtieth A340
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Moscow Sheremetyevo International Airport handled 148,000 tonnes of cargo in the first six months of 2019, along with 22,000 tonnes of mail, representing 2% growth over 2018. International airlines handled 111,000 tonnes of cargo and domestic airlines carried 37,000 tonnes. The largest increase in exports came from Liege, Milan, Hong Kong and Petropavlovsk-Kamchatsky and the largest increase in imports were from Chongqing, Beijing, Seoul and Paris.
Air Canada Cargo will expand its sales team in Canada by partnering with general sales and service agent Exp-Air Cargo. The collaboration will take effect on 1 October and provide businesses with sales representation tailored for their domestic air cargo needs.
Airway Bill’s Page 3
One from the vaults: Back in the days before CGI (Computer Generated Images), if you wanted an aircraft to wear a hat, you had to have a big hat, or titfer in London Cockney.
Airfreight throughput fell by 5.1% at Singapore Changi Airport in June to 162,000 tonnes. This year, airfreight is down by 5.7% to 983,000 tonnes. Changi welcomed new routes in June including Qatar Airways Cargo launching two flights a week with connections to Macau and the USA.
Dana Schulze has been named director of National Transportation Safety Board office of aviation safety. She has served as deputy director since 2012 and been acting director since November 2018.
K+N completes WWP acquisition Kuehne + Nagel has completed the acquisition of Worldwide Perishable Canada (WWP), a major player in the perishable market, particularly exporting tuna. The Halifax, Nova Scotia-headquartered company was founded in 1999 to serve a local demand for Canadian exports, and has since grown into one of the country’s major perishable forwarders. The combined volume of both companies’ business portfolio will account for more than 17,000 tonnes of air exports of perishables per annum out of Canada. Greg Martin, regional airfreight manager for Kuehne + Nagel North America says perishables are one of the company’s strongest areas, which is why it continues to expand the network. He says: “Setting up global certified standards which are reflected in our KN FreshChain solution, has further strengthened our perishables network worldwide, making it the largest in the industry.” Doug McRae, chief operating officer of WWP says: “Combining the strengths of both companies, we will add outstanding value in the regional and international perishables business. For both, our customers and our employees this will generate growing perspectives and services.”
ACWBITEs
In 2000, Lufthansa received its 30th A340-300 at Munich Airport. Everyone at the ceremony wore traditional costumes, including the A340.
British Airways resumed flights to Cairo on Friday 26 July, having been suspended for a week due to security concerns. The daily flight from London Heathrow had been cancelled on 20 July. The Foreign and Commonwealth Office warns that terrorist attacks are very likely to be carried out in Egypt, particularly in North Sinai. Ireland’s national carrier Aer Lingus has taken delivery of its first of eight Airbus A321LRs. The aircraft is on lease from Air Lease Corporation and will be used on transatlantic routes to the US East coast. Etihad Airways will add a fourth daily service to London’s Heathrow Airport on 27 October. The additional service will use a Boeing 787-9 Dreamliner, departing Abu Dhabi at 13.40 and landing at Heathrow at 17.45. The return flight, EY18 will leave Heathrow at 21.05 and land in Abu Dhabi at 08.05 the next day. Etihad also operates three Airbus A380 services to Heathrow a day. Danielle Laberge will succeed Normand Legault as chair of the board of directors of Montreal airport operator, Aeroports de Montreal. Legault, who has been chair since 16 September 2015 is retiring having completed his third term, the maximum number allowed under governance rules. Delta Airlines will connect New York and Bogota, Colombia with daily flights from John F. Kennedy International Airport from 21 December. The Boeing 757-200 flights will leave New York at 18.10 and arrive in Bogota at 12.05 the next day. The return flight will leave Bogota at 01.10 and land in New York at 07.00.
This was not a Photoshopped image but a very large hat on an aircraft. The article of headwear is rumoured to still exist at the airport, presumably in a very large store cupboard.
aircargoweek.com
Ethiopian Airlines will start flights to Bengaluru, “the Silicon Valley of India” on 27 October using a Boeing 737-800 four times a week.
ACW 5 august 2019
3 01/08/2019 14:10
NEWS
Air India to use Unisys Digistics software suite
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ir India will use the Unisys Digistics logistics software suite to create a connected and automated cargo ecosystem for consistent and accurate data across the airline. Under the contract, the next generation cargo platform will feature three additional modules on a software-asa-service basis to streamline freight management and improve operational efficiencies. The modules are Digi-Accounting for real-time revenue accounting and reconciliation; Digi-Mobile to let cargo staff use mobile devices to process shipments on the move at any location; and Digi-Analytics to provide data for highlighting cargo patterns. Unisys will also provide a postal mail and parcel shipment scanning and tracking service to allow the airline and customers to have full visibility of shipment progress.
A lot of horsepower at AirBridgeCargo
AirBridgeCargo Airlines demonstrated its horsepower by transporting nine racehorses from Moscow to Amsterdam on a Boeing 747-8 Freighter. The abc care team oversaw each step of the journey, keeping waiting times to a minimum within warehouses, on the apron and while loading and unloading the aircraft. ABC specialists tried to shorten before-
the-flight standard procedures and set the required environmental conditions during the flight. Tatyana Kosterina, who rode 11-year-old Diavolessa says it was a great experience to fly with her horse and be able to check the animal during the journey. She says: “Air transportation is the most preferable way of journey, as we cover the distance within several hours and my horse does not experience car sickness, as is the case with vehicle transportation.” Fedor Novikov, deputy general director of special products and services at AirBridgeCargo Airlines says: “We are honoured to be entrusted with the delivery of these horses. Our dedicated ‘abc care’ team with well-set operational processes in place guarantee safe journey of animals which partially facilitated their sports results.”
Winters succeeds Magee as CEO of Crane Keith Winters has been appointed CEO of Crane Worldwide Logistics, taking over from John Magee who is leaving after 11 years in the role. Winters has been with Crane for more than 20 years, including eight years as chief operating officer. Most recently he served as CEO of Davaco, a company affiliated with Crane Capital Group, which Crane says makes him an obvious successor. Company chairman Jim Crane says: “Crane Worldwide has built our success as a result of our talented people and our unwavering commitment to client service. I am excited that our CEO successor has come internally as Keith exemplifies all of the great values we have built this company on.” Winters says: “Crane Worldwide is a best in class global supply chain and logistics organi-
sation. I am honoured to lead our team of over 1,800 employees into the next chapter of our growth and I look forward to working alongside our clients to continue to drive innovation within this industry.”
CharterSync, launched at air cargo Europe Munich, in its first week of trading successfully completed 16 time-critical air charters. The London-based start-up whose intelligent platform expertly synchronises time-critical air charters for freight forwarders, generated charter options in under three minutes from request to quote for its customers. “CharterSync accelerates the booking of time-critical air charter bookings for freight forwarders. Our platform adds transparency to cost whilst providing a gateway to the most
suitable aircraft in real time. Our first week has exceeded expectations with the performance of the platform, and delivering ease of operation, time-saving, accuracy and cost reduction for our customers. Our industry expertise has made this possible,” co-founder of CharterSync, Simon Watson, commented. The platform which is accessed through desktop and on Android and Apple mobile systems, exceeded CharterSync’s expectations, easily coping with a diverse range of cargo specifications. Many of the bookings involved complex
Nirbhik Narang, executive director cargo at Air India says: “Unisys is helping us implement a next-generation cargo platform that uses automated real-time data collection and processing to streamline processes. As it is integrated with our accounting system it will enable prompt and accurate invoicing for carriage of cargo for better credit control, fewer bad debts and ultimately better cash flow.” Rick Mayhew, vice president and general manager for Unisys Asia Pacific says: “By automatically capturing and using a single data set throughout the process from booking to accounting, based on the trusted air waybill, Air India will be at the forefront of the cargo industry’s modernisation and transformation to a connected cargo supply that will not only improve transparency for the airline’s customers, it will streamline processes and improve credit control and cash flow for the airline.”
Air cargo veteran Ron King dies aged 76 Air cargo veteran Ron King, who helped establish Volga-Dnepr in the US market has died just days before his 77th birthday. King, who died suddenly on 19 July, and would have turned 77 on 22 July, spent almost 50 years in logistics. Leading the tributes, Volga-Dnepr says King was always eager to share his professionalism and extensive experience. He held executive positions at Curtis Air Services, Transamerica Airlines and World Airways. King joined Volga-Dnepr in 2001 as a commercial director in the USA and in his 14 years with the company, helped build its image, gain new projects, attract new customers and strengthen its market position. Konstantin Vekshin, executive president of charter cargo operations at Volga-Dnepr says: “During his time with Volga-Dnepr, not only has he reinforced the company’s position,
but has also been a tutor to the whole team members who took on board his knowledge, experience and personal approach to business development. “Ron will be sadly missed as he was a true personality who possessed the unique knowledge of air freight. His contribution will always be highly appreciated.”
Gulf Air is continuing its Bahrainisation programme with the appointment of Wael Mattar as senior manager cargo for its Bahrain hub. He joined Gulf Air in 1995 as a security and
safety supervisor, and will apply experience in sales and at stations across the GCC and Egypt to one of the airline’s main revenue generating departments. The airline operates an average of 1,000 flights a week, and Mattar will be tasked with further strengthening Gulf Air’s cargo growth globally. Mattar says: “I feel proud to be assigned in charge of the cargo department as the airline has an opportunity to grow its cargo sales and operations and I am glad the management showed confidence in me to lead this.” Gulf Air says it is committed to investing in its Bahraini workforce, providing them with opportunities to take over senior management positions. 90% of employees at the Muharraq headquarters and almost 70% of pilots for Gulf Air are Bahraini nationals.
Mattar to manage Gulf Air’s Bahrain hub
First week of trading is a success for CharterSync
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payload and dimensional restrictions, but the system proved to be reliable and unphased. In the first trading week, CharterSync confirmed time-critical cargo bookings on a range of aircraft, from the smaller Cessna to AN-12 carrying 18 tonnes. CharterSync onboarded 15 time-critical air cargo operators in this time and continues to grow operations.
aircargoweek.com
01/08/2019 13:44
Ready or not, here comes Brexit
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ssociations representing the UK’s freight industry have warned that the logistics sector is not ready for a no-deal Brexit. Boris Johnson (pictured), who realised his life-long ambition of getting the keys to 10 Downing Street and becoming Prime Minister on 24 July, has been very insistent that the UK will leave the European Union on 31 October this year deal or no-deal. To show that the threat of no deal is not an inverted pyramid of piffle, he has assigned Michael Gove, the Chancellor of the Duchy of Lancaster to co-ordinate no-deal preparations. James Hookham, deputy CEO and head of Brexit readiness at the Freight Transport Association (FTA) says the logistics industry needs to take the prospect of no-deal seriously to ensure goods and service can continue to move. In the run up to the original Brexit deadline of 29 March, the FTA lobbied the UK and EU to
obtain temporary easements and contingency measures to keep trade links open. He says: “Many of these will expire, or are due to lapse shortly after the new 31 October Brexit deadline, and FTA is urging the new ministerial line ups to prioritise extending or re-establishing the necessary measures to ensure that trade can continue to flow freely to and from British industry.” The Confederation of British Industry (CBI) has warned that neither the UK nor Europe is ready for no-deal, saying that the EU lags behind the UK in seeking to prevent the worst effects of the scenario. In its report, “What comes next? The business analysis of no-deal preparations”, CBI says although businesses have spent billions on contingency planning for no-deal, they are hampered by unclear advice, timelines, cost and complexity. Saying that CBI’s report hits the nail on the head, the British International Freight Associa-
BA pilots get ready for a summer of strikes
British Airways pilots are set to go on strike over the summer after an injunction against the action was rejected. Pilots represented by the British Airlines Pilots Association (BALPA) had voted to go on strike, with 93% supporting the decision in a ballot. British Airways had sought an injunction, but this was rejected by the High Court on 23 July and the appeal to the Court of Appeal was also dismissed on 31 July. Brian Strutton, general secretary of BALPA says: “BA’s attempt to defeat the democratic view of their pilots in court, rather than deal
tion (BIFA) warns that its members cannot prepare for a no-deal Brexit due to uncertainty over many issues. He says the news that few companies have registered for the government’s online system to protect value added tax revenues on foreign parcels, BIFA questioned whether the government was listening to advice from industry experts. Director general Robert Keen says: “With less than 100 days to the Brexit deadline, departments in that new government must urgently step up their preparations, engage with and listen to trade
associations such as BIFA, immediately step up their preparations and deliver clear advice on how trade will be conducted after October 31st, deal or no-deal.”
Antonov Airlines is continuing to provide air support to Oil Spill Response after it ordered a second transport skid for its oil capping stack in Singapore. The transport skid will be available to Subsea Well Intervention Services subscribers in the fourth quarter, and will supplement the existing skid located in Stavanger, Norway. The first stack was introduced in August 2018 where a demonstration flight was performed as part of a large-scale exercise from Stavanger. The combined capping stack and airfreight skid design was verified for air transport by Antonov Airlines’ technical department for the AN-124-100 and AN-124-100M-150, and the AN-225.
Martin Griffiths, commercial manager of Antonov Airlines says: “We were very happy with the demonstration flight that was performed last year on one of our AN-124-100s in Stavanger. It was the first time anyone has transported a fully assembled capping stack on an aircraft, and in the event of any future oil spill emergencies, we will now be able to provide a rapid response anywhere in the world.” Andy Myers, OSRL SWIS director says: “Introducing the additional air freight capability for our Singapore capping stack adds to mobilisation options for our subscribers not just in APAC but enhances our global response coverage bench strength.”
Antonov supports Oil Spill Response
with us across the negotiating table, has sadly wasted huge amounts of time and money that could have been put into finding a peaceful resolution. Now the window for negotiation and compromise is closing fast.” He says the pilots want to resolve the matter through negotiation and have not yet announced strike dates. The pilots must provide British Airways with 14 days’ notice of any proposed strike action. The pilots voted for strike action on 22 July, having rejected a pay deal worth 11.5% over three years.
A350-1000 joins British Airways fleet British Airways has taken delivery of its first Airbus A350-1000 at the aircraft manufacturers’ headquarters in Toulouse, France. The A350 XWB has a range of up to 15,000 km and features the latest aerodynamic design, a carbon fibre fuselage and wings, and Rolls-Royce engines. Together these reduce fuel burn and emissions by 25%. British Airways’ A350-1000 is the first one to join International Airlines Group’s fleet. British Airways has 18 A350-1000s on
order. IAG’s Iberia already operates five smaller A350-900.
Brave cancer survivor Reid’s name flies on Pacific coast FedEx Express and St. Jude Children’s Research Hospital in Memphis, Tennessee have dedicated a Cessna Caravan to patient Reid, whose father, Barry Russell is a pilot for the company. For the eighth consecutive year, the Purple Eagle ceremony took place near the driving range at TPC Southwind in Memphis, home to the World Golf Championships-FedEx St. Jude Invitational. Reid joined the ceremony to unveil his name on the aircraft featuring the St. Jude logo. His name will travel throughout Canada’s Pacific coast as a permanent fixture on the Cessna Caravan. Bill West, vice president of supplemental air operations at FedEx Express says: “The Purple Eagle programme is a special way for FedEx to honour a St. Jude patient, who is the child or
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grandchild of a FedEx team member, and brings attention to the life-saving work being done by the hospital every day. “Reid’s determination and positive outlook truly embody the spirit behind this recognition, and we’re honoured to add his name to our Purple Eagle fleet.” Reid was diagnosed with cancer in 2015 at the age of 7. His family turned to St. Jude where treatment included chemotherapy and proton therapy. He is in remission and visits for regular check-ups. Barry says: “Reid was so excited when he learned FedEx was naming the Purple Eagle plane after him. We are so thankful for the care he has received at St. Jude. It’s truly a place where miracles happen.”
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NEWS with airlines and freight forwarders with shippers.” The Freightos partnership has been a great success. WebCargo was given freedom to keep its brand and team, allowing for a smooth transition. Synergies between the two groups was strong, helping the marketplace grow and the two brands remaining strong.
Air cargo lags behind other sectors
Galindo believes that take up of digitalisation has been very slow in the air cargo industry, especially compared to the passenger sector. Admitting the cargo and passenger industries are different, Galindo says digitalisation was happening 20 years ago. The courier sector is more relevant as a comparison, and that is highly digitalised. He says: “We are in the beginning of digitalising the market, we will see a big change in the next five or six years. The big movements are coming for the holy trinity of IAG, Lufthansa and Air France. They decided to open the service through APIs and channels like WebCargo and give the option to the freight forwarder to buy, to check the best rate available and book online in a system where they can always offer the best price available.”
The big boys lead the way
The big interview with Manel Galindo of WebCargo by Freightos
Galindo says this is pushing other airlines to follow, saying the market needs the big players to make the move. In the freight forwarding sector, Galindo says online sales portals launched by the likes of Panalpina, Kuehne + Nagel, Geodis and Maersk to sell directly to shippers, shows the market is starting to move to digitalisation. He predicts there will be a big change in the next five to six years. He comments: “I cannot say that in six years we will be fully digitalised but a big percentage of the market will be digitalised. I see that because big players are moving, this is when you feel and smell that something is happening.” Galindo believes that the complexity of air cargo is a major reason why it is so far behind the passenger sector. He also thinks that shippers were not pressurising freight forwarders into embracing digitalisation. He says: “Until recently you didn’t see your client, the shipper starting to ask for this service, to be digitalised. Also, the airlines see that if they are digitalised, they will be more efficient and they will be able to manage all the pain they have right now, to manage the spot rates coming from freight forwarders.” Saying that every day, they have to deal with thousands of spot requests, asking how much they charge for a shipment of 100 kilos as an example. “They start to feel this pain, they are seeing the advantage of digitalising.” He thinks the air cargo industry needed more time to embrace digitalisation because the market prioritised the passenger sector for airlines.
The air cargo industry has been talking about digitalisation for years but action has been slow. Now the big players are seeing the advantage, the flood gates have been opened What do we want? Digitalisation! When do we want it? Now! and cannot be closed.
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ith over 1,400 freight forwarders and 300 airlines using its system, WebCargo is moving away from being just a freight management system to help digitalisation of the air cargo market. Speaking to Air Cargo Week’s deputy editor, James Muir at air cargo Europe, Manel Galindo, CEO of WebCargo by Freightos explained that the company initially focused on freight management where freight forwarders could access the system. This let them search for origin and destinations, seeing which airlines operated on the lane, so they could send a quote to the shipper. The next step is full digitalisation of the market. Lufthansa Cargo, Air France KLM Martinair (AFKLMP) Cargo and IAG Cargo, who signed up at air cargo Europe, were offering dynamic pricing so the freight forwarder could see the best available price online. Galindo says: “They don’t have to call or send an email. They select one, then send a quotation to the client or directly book with the airline. It is all the workflow that the freight forwarder is doing; search, quote and book.” Having large airlines such as AFKLMP offering dynamic pricing, Galindo says this makes it easier and reduces the time to get an export rate. He says rather than send an email or make a phone call, then wait 30 minutes or maybe a week, the best rate is available immediately. Galindo says: “This is a big change that is creating efficiency for all the chain, from the shipper to the airline.”
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The new way must be an improvement
When WebCargo was launched in 2008, there were companies offering a similar service but they faced the issue that the airlines were not ready to offer dynamic pricing and capacity. Rather than being an online booking platform it was a booking request, and airlines still took their time about giving prices. Galindo says: “It was easier and faster to call or send an email than do a booking online. The online booking has to be easy and fast. In 30 seconds, you need to offer the best rate available, the flights where they have the capacity, you select one, you book and you get the confirmation. If there is no difference between the online and the offline channel, then the freight forwarder will continue to use the offline channel.” Two and a half years ago, Freightos acquired WebCargo. The group wants to digitalise the freight forwarders and bring them into the 21st century. Galindo says: “We think sometimes it’s expensive to digitalise a company because it needs a lot of consulting and effort. The idea of Freightos is to try and bring digitalisation for the whole market in an easy and cheap way. This is why we decided to join up with Freightos.” Galindo says that WebCargo is focused on digitalising freight forwarders with airlines and the marketplace is trying to digitalise freight forwarders with shippers. “At the end, what we are doing is connecting freight forwarders
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Galindo also says that 10 years ago, shippers were not asking for real digitalisation but now they are pressurising freight forwarders to offer services. Larger forwarders are opening sales portals and airlines are offering APIs so this is the moment where the market is ready for digitalisation. Galindo says: “Once this starts there is no stopping it. The digitalisation will increase and we will need to fix a lot of things but it’s something that every day and every year will be much more efficient and much easier to do it online than in an offline channel.” Something that amuses Galindo is that the older airlines such as British Airways and Iberia of IAG, Air France, KLM and Lufthansa are leading the way. He says this is because they believe that if they are more efficient, the clients will receive better service. He says: “If big players start to digitalise the market, the rest of the players will follow and right now we are talking to many airlines to help them digitalise and offer dynamic pricing and capacity in real-time.” Galindo says the actions of the larger players is driving other airlines to ask questions, wanting to know how to digitalise their company. He says: “They see that this is an efficient way to be faster. The shipper is the final client and normally wants the shipment at the destination yesterday, not tomorrow so a fast answer is really important.”
31/07/2019 14:29
DHL calls all F1 fans
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n April 14, Formula 1 celebrated its 1,000th race in Shanghai at the Formula 1 Heineken Chinese Grand Prix 2019. As official Formula 1 logistics sponsor, DHL conducted its own “race before the race” to ensure the successful transport of the F1 freight to China. To mark this milepost, DHL initiated the #MyF1Moment fan competition – a chance for participants to win a trip to cover a Grand Prix event as DHL’s fan reporter. DHL has been active in Formula 1 for over 35 years, and official logistics partner since 2004. It is responsible for transporting all cars and equipment for all F1 teams to races outside Europe. The race in Shanghai is the 287th for DHL as official logistics partner. Some employees of the DHL Motorsport team have supported over 500 races. “Formula 1 is the motorsport leader, synonymous with speed, precision and peak performance,” said Arjan Sissing, senior vice president group brand marketing at Deutsche Post DHL Group before the milestone event. “The fact that it’s running its 1,000th race this Sunday is also testament to Formula 1’s early pioneer spirit and reliability over the years.”
Calling all fans
DHL’s #MyF1Moment competition calls on fans to share their biggest Formula 1 moment – in writing, with a photograph or via video. “We’re proud to be able to contribute to these Formula 1 moments as official logistics partner,” says Sissing. “The competition calls on fans everywhere to share with us their most memorable moments over the course of these last 1,000 races.” The winner will travel to a Grand Prix as the DHL fan reporter. Fans can sign up and participate until 18 August, 2019 at www. inmotion.dhl/formula-1/my-f1-moment/. A jury will select the best 50 submissions; the winner will then be determined via online community voting.
Amateur gamers
As part of the Formula 1 e-sports series, DHL is also hosting its “DHL 50 Fastest” competition featuring many attractive prizes. In late May, 50 amateur gamers, influencers and fans competed against each other playing the F1 game by Codemasters. At the Fan Festival in Shanghai and in Fan Zones along the course, fans will have the chance to qualify on special race simulators. They can also participate online. The six top finishers in “DHL Time Trial” then qualified for the Formula 1 e-sports “pro draft” in July. All participants will also have the chance to win tickets to the season finale in Abu Dhabi, where the DHL Fastest Lap award will be presented. Since 2007, DHL has presented its award to the driver who has accumulated the most “fastest laps” over the course of the season. As of this year, drivers receive an additional point when finishing in the top 10.
Formula 1 is the highest class of single-seater auto racing sanctioned by the Fédération Internationale de l’Automobile (FIA) and owned by the Formula One Group. The FIA F1 World Championship has been the premier form of racing since its inaugural season in 1950. An F1 season consists of a series of races, known as Grands Prix which take place worldwide on purpose-built circuits and on public roads. aircargoweek.com 06 - 07 5 August 2019.indd 3
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NEWS
cool chain - specialist food
When airfreight is a matter of faith
Airfreighted food has become commonplace in a way it never was decades ago. With that change, has come a split between commodity and specialist food handling activity throughout the cool chain.
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trillion, and the airline reviewed all processes to ensure they met strict requirements. He says: “Additional facilities were also added to cater to the need of maintaining segregation and separation between Halal and non-Halal shipments. We are most probably the first cargo terminal operator in the world to be classified as a Halal cargo handler from a globally recognised and renowned Islamic Affairs Regulator for Halal products.” Following certification, MASkargo shipped 720 kg of frozen food to Japan under its Halal Logistics service. Flight MH088 left Kuala Lumpur at 23.30 on 24 June and arrived at Tokyo’s Narita International Airport at 07.40 the next morning. The shipment was booked by Nippon Express (Malaysia), with Roslan Osman, general manager of the Halal Logistics Division commenting: “The reality of an integrated halal supply chain is made possible by such collaboration between stakeholders in the halal ecosystem. A halal certification makes exporting products to Muslim markets much easier.”
arm to table. Fair trade. Ethically sourced. According to the World Economic Forum, these recent trends are evidence of consumers demanding to know more about the products they are buying – from who made them to how they were sold. Equally important has become the mode of transport from producer to retailer. The vast majority of fresh or frozen food moved across the cool chain is best described as ‘commodity’, almost ordinary. Fresh fruit, chilled salmon, seasonal vegetables are ordinary and present few issues apart from avoiding spoilage and ensuring they are delivered on time and in a condition fit to eat to the consumer. There, however, some foods in the cool chain cannot be described as commodity or ordinary, that are not to be handled with the bulk of food sent along the supply chain. These are foods that are produced or manufactured under strict religious or cultural laws and supervision that are handled by the supply chain.
All kosher
While all the world’s major faiths have dietary laws and traditions, some observed more than others, two have particular sets of laws, instructions and belief that impact on the cold chain throughout airfreight transport. Islam and Judaism have halal and kosher laws respectively that impact on how food is shipped and transported in the supply chain. Muslims eat halal (lawful) foods, which include fruit, vegetables and eggs. Any meat and meat products they consume must be from a halal-slaughtered animal. Milk and dairy foods are halal, cheese may be halal depending on ingredients. Haram (prohibited) foods include pork, crustaceans, blood, non-halal animal-derived additives such as gelatin or suet, alcohol and any foods containing alcohol as an ingredient. There has been little work done on how to integrate halal food with air cargo operations. Halal means that there can be no cross contamination between halal and non-certified halal products operations. Air cargo terminal operators handling halal food must monitor the movement of the goods once they are inside the terminal. They must monitor and handle with control and responsibility. Separate refrigeration units, often overseen by local Imans, must be provided. The global halal foods and beverages market is set to be worth just south of $700 billion in 2024 after enjoying some eight years of 6% growth worldwide. From a market perspective, the traditional major halal markets remain in Asia-Pacific and the Middle East. However, halal markets in the UK, Europe, and the USA will see their roles in the development of the halal market significantly enhanced, as they are markets that play defining roles in other markets around the world. It will bring halal into the global
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mainstream. As the dynamics within the Muslim world change and globalisation trends continue to shape consumers’ tastes, habit, and spending patterns across the world; it is highly likely that the developing halal markets will have increas-
ingly influential roles in the established markets of the Middle East and Asia, particularly by influencing global corporate halal strategies. One airline operation keen to take a share of this expanding market is MASKargo. It has recieved Malaysian Halal certification from the Department of Islamic Development, Prime Minister’s Office, Malaysia (JAKIM). Ibrahim Mohamed Salleh, chief executive officer of MASkargo says the global food and non-food halal market is worth almost $2
Japan-bound Halal frozen food being loaded in specially labelled ULD upon acceptance.
At the same time, the global kosher food market is projected to register expansion at 11.6% CAGR between 2017 and 2025, according to a report by Persistence Market Research (PMR). PMR’s report states that the market will have revenue worth $24.1 billion in 2017; by 2025 this number is estimated to be nearly $60 billion. Kosher food manufactures are targeting Jewish as well as non-Jewish communities globally. Growth of the global kosher food market is primarily attributed to concentration of Jewish population in specific regions, coupled with a few members of various Christian communities. Increasing adoption of kosher foods by vegetarian consumers, health conscious consumers and patients with lactose intolerance and celiac disorders, is further expected to drive growth of the market. Middle East & Africa (MEA) will witness fastest growth in the global kosher food market, and is estimated to be the largest market for kosher food by 2025-end. Sales of kosher food in MEA is expected to reach revenue worth $24.8 billion by 2025. In addition, North America is expected to follow MEA in terms of market share, expanding at 11.3% CAGR through 2025. In contrast, Asia Pacific will hold the lowest share of the market during the forecast period.
Ibrahim Mohamed Salleh, MASkargo CEO proudly showing the Halal Certificate received from JAKIM, represented by Dato’ Dr. Sirajuddin Suhaimee and Tuan Bukhari Md. Akhir.
aircargoweek.com 31/07/2019 14:32
cool chain - specialist food
Photo: WFP/Bruno Djoyo
WFP airlifts food to save lives in Zemio
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The UN’s World Food Programme (WFP) works in more than 80 countries around the world, feeding people caught in conflict and disasters.
t the start of the year, the United Nations World Food Programme (WFP) launched an airlift operation to deliver life-saving food supplies to 18,000 people in Zemio in the Central African Republic (CAR), 1,000 km east of the capital Bangui. The region was on the brink of a severe food and nutritional crisis, due to a combination of insecurity and transport infrastructure challenges, which hampered humanitarian access to the area. “The humanitarian situation in Zemio is perilous and can quickly descend into a catastrophe, if we do not act now,” said Gian Carlo Cirri, WFP
representative and country director in CAR. “Partners on the ground say women and children do not have enough food to eat.” A spike in violence in and around Zemio curtailed movement, with people unable to access markets. Most food reserves were lost because of violence. The airlift was the first step of a more comprehensive plan to address the humanitarian situation in the south-east of the country. WFP provided food to internally displaced people (IDPs) and the hosts who have been sheltering them. Specialised nutritious food was distributed to families with young children, pregnant
women and breastfeeding mothers. WFP normally moves supplies into Zemio via Obo by land from neighbouring Uganda and by river from the capital Bangui via Bangassou. A broken bridge and out-of-service ferries made this impossible. WFP looked into alternative options to move food by river while engineers from the UN peacekeeping mission (MINUSCA) worked to repair the ferry. Long-running conflict is having devastating effects on people in the CAR. Up to 2.1 million
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Food insecurity
people, almost half of the country’s 4.7 million population, are food insecure according to the National Food Security Assessment (NFSA) released last January. A recent national nutritional survey (SMART) also shows 7.1% of global acute malnutrition (GAM) among children aged 6 to 59 months. The severe acute malnutrition (SAM) exceeds the 2% emergency threshold at national level and in 10 prefectures out of 16. The CAR and 14 non-state armed groups signed a peace agreement on 6 February under the auspices of the African Union with the support of the United Nations.
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south africa
Is the sun shining on the rainbow nation?
Four years driving the sub-Sahara’s engine
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n the four years since HAE Group started operating in South Africa, growth has continued at double digit rates says director Neville Karai. HAE entered the South African market in 2015 through wholesaler subsidiary Groupair, and Karai says it has been a big success story. As a wholesaler, Groupair offers consolidation, airport to airport, and airport to door services to and from South Africa. This year it has also developed an authorised reseller programme for express services called online express. Karai says: “With the launch of our online express product we look forward to strong growth in our exports and via our solutions activity from China and the US. We believe the second half of 2019 will be equally as strong as previous years.” HAE’s South African office is in Johannesburg, the heart of South Africa’s air cargo market. Karai says: “We have customers in Durban and Cape Town, who hub traffic via Johannesburg and use it as the main intercontinental gateway to and from the rest of Africa, Europe and the US.” Karai says HAE is actively working on expansion into Cape Town. He says: “We are interested to support the smaller for-
warders on the Western Cape and offering services directly from Cape Town and also operating truck services to Johannesburg for onforwarding.” Looking ahead, Karai says South Africa will remain the engine driving growth in sub Saharan Africa with engineering, other industrial and consumer products. He says: “This continues to drive growth in regional services to west, east and Central Africa. On an intercontinental basis many airlines are returning or increasing capacity and frequency and this should help support the growth we see and give options.” Despite the size of South Africa’s economy, there are challenges such as the high unemployment rates and unstable electricity supplies. Karai says the main challenges for HAE are financial due to volatility of the currency, the Rand, making forecasting a return on investment difficult and margins also fluctuate. There may be challenges but HAE is committed to the South African market. Karai says: “HAE through Groupair remains a key strategic growth opportunity for our company and we are committed to continued growth and market share in South Africa.”
Solar power energises Tigers
Shipments in the renewable energy sector are helping Tigers maintain volumes, bringing a ray of sunshine to the rainbow nation. Paul Lawrence, managing director of Tigers Global Logistics South Africa says that renewable energy, mainly solar power helped the company maintain volumes in the first half of 2019. He comments: “While existing support has traded lower year on year, new segments and new business has allowed us to maintain year on year volumes up to this point.” Lawrence predicts that the second half of the year will be an improvement on the first half, with positive overall growth. In South Africa, Tigers mainly operates in the retail, automotive, pharma, perishables and industrial sectors. He adds: “We have added renewable energy and technology this year and our exports into Africa have grown.” The company is handling two of the biggest
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solar panel suppliers. The airfreight division also handles considerable exports of IT equipment into Africa. Tigers also offers specialist services for customers in South Africa, with Lawrence saying: “We offer pharma capability, Tiger Fresh (our perishables solution), general freight forwarding, hand-carry, SmartHub:Connect visibility and data analysis, and e-commerce fulfilment.” With offices in Johannesburg, Cape Town, Durban and Port Elizabeth, Lawrence says these are the places to do business in South Africa. He says: “We believe these are the main centres in South Africa and we have the country well covered.” For the future, Lawrence sees a greater focus on consumer finished goods to cater for e-commerce growth. He also predicts the market will become more competitive. For the most part, it is “reasonably easy” to do business in South Africa. Lawrence says: “Some
Karai
Lawrence
areas are becoming more regulated and certain requirements need to be met before certain products can be imported, specifically electrical consumer products.” Despite South Africa being much stronger and more stable than many African nations, Lawrence says it faces the challenges of rising costs, bureaucracy and declining infrastructure due to the lack of maintenance. He says: “Customs has implemented new advanced manifest requirements and introduced penalties if the timelines are not met. There are also specific requirements required for all electrical/electronic products that require a letter of authority from the National Regulator for Compulsory Specifications before any of these products can be imported.”
aircargoweek.com 01/08/2019 13:46
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