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The weekly newspaper for air cargo professionals Volume: 20
17 July 2017
Cargo contracts handed out for Istanbul New Airport
stanbul New Airport has signed contracts with six companies worth a whopping €250 million to develop facilities in the Cargo City and Ground Services Campus. The state-of-the-art gateway in Istanbul is set to open in the first quarter of 2018 and will have the largest cargo capacity of any hub. When all development phases are completed it will have 5.5 million tonnes. Hong Kong Internationational Airport currently has the most with a capacity of just over 4.5 million tonnes. MNG, PTT, Celebi Ground Handling, HAVAS, Sistem Logistics and Bilin Logistics will serve at the Cargo City; and MNG, Celebi Ground Handling and HAVAS at the Ground Services Campus will build their own facilities at the Cargo City and Ground Services Campus within the scope of the 25-year contracts. IGA Airport Operation chief executive officer, Huseyin Keskin says Turkey’s strategic location, investments in the freight sector by Turkish Airlines and the developing economy makes Turkey a crucial country for air cargo, while ground services are essential to make airport operations efficient. He says: “At IGA, we signed off our first cargo and ground services agreements to deliver
COMMUNITY APPROACH PAYING OFF FOR SCHIPHOL DIGITAL AND FLOWERS HIGH PRIORITIES
seamless services and place Istanbul, the meeting point of civilisations for centuries, at the heart of aviation. We are quite delighted about that. Within this scope, we signed area allocation agreements, totalling €250 million, with six major Turkish-founded companies.” The Cargo City is equal to the size of 200 football fields, and will allow simultaneous operation of 35 wide-body cargo aircraft. Keskin says: “Once opened, the airport will have 2.5 million tonnes of cargo capacity. Currently, the airport with the largest global cargo
ACI Europe urges Brexit and EU aviation clarity
The European airport industry has again warned about Brexit and its potential impact on European air transport, connectivity and the wider economy during a public hearing in the European Parliament in Brussels. The Airport Council International (ACI) Europe says more than a year on from the UK’s vote to leave the European Union (EU), the uncertainty as to what will happen when the UK will exit the EU has yet to subside. ACI Europe says a cliff-edge scenario – of the UK leaving the EU without a new trading relationship with the bloc being defined and agreed – “cannot be discarded”. ACI Europe calls on the UK to “urgently come up with a detailed and comprehensive position on Brexit for aviation” and says this position
PRIME DAY IN THE US FLIES HIGH FOR AMAZON
should allow the UK to safeguard and further develop its air connectivity with the EU27 and beyond – and wants it to remain in the Single European Aviation Market. ACI Europe director general, Olivier Jankovec says: “We remain completely in the dark as to what will happen on 1 April 2019 and we have no idea how long this uncertainty will persist. “The fact the UK has yet to define a clear and detailed position as to what it wants – not just in terms of its new relationship with the EU, but also about how to transition there – is not helping. This only results in precious time being lost and potentially increases the risk of a no-deal scenario – which should be avoided at all cost, as it could ultimately result in flights between the UK and the EU being suspended.” Meanwhile, ACI Europe says freight posted monthly YOY growth of 12.2 per cent in May on the back of improved economic conditions globally and a rebound in international trade.
movement is Hong Kong Airport with a volume slightly more than 4.5 million tonnes. “Yet, the Istanbul New Airport will have a capacity of 5.5 million tonnes when its all phases are complete.” More than 22,500 people have been working on the developing the huge hub, which will be the world’s biggest when it opens. Istanbul New Airport is set to aid the strong growth of Turkish Airlines and its cargo arm Turkish Cargo and establish itself as a key ‘mega hub’ in the region.
Turkish expanding fast
Turkish Cargo has vastly expanded its freighter network over the last four weeks and the question is where is next on the radar? New routes to South Africa and Madagascar begun on 1 July with a weekly Istanbul – Johannesburg – Antananarivo Airbus A330 Freighter service. The African network was also enhanced on 4 July with an A330F route to Kano – its second connection in Nigeria. It will operate on an Istanbul – Kano – Dakar – Istanbul routing. Turkish also launched a new freighter A310F service from Istanbul to Paris on 21 June, and it also started an A330F route to Sao Paulo in Brazil on 25 June.
GOVERNMENT REFORM HELPS INDIAN MARKET
DHL moon mission
CONSUMERS can soon send packages to the moon using DHL’s MoonBox, with the first flight on track to launch in 2019. The Peregrine Lunar Lander, produced by Astrobotic will primarily be used for science, exploration and marketing payloads, but private individuals will be able to send objects up to one inch in diameter using small honeycomb-shaped boxes called DHL MoonBoxes. The first mission in 2019 is set to carry numerous DHL MoonBoxes and 35 kilogrammes of cargo for science and exploration, with the payload rising to up to 265 kilogrammes on later missions. Astrobotic vice president of development, Dan Hendrickson says: “Our commercial lunar mission is giving institutions and countries around the world their first opportunity to reach the Moon, and at a historically low cost.” Customers can order their DHL MoonBox and DHL will be in charge of the outbound delivery and transport to Astrobotic, where the packages will be stored for safekeeping until the first lunar mission.
NEWSWEEK Heathrow posts 13% tonnage growth in June
argo volumes continue to rise at Heathrow Airport with growth of over 13 per cent in June, with cargo to and from Latin America seeing the biggest increase. Heathrow handled 142,349 tonnes of cargo, a yearon-year increase of 13.4 per cent, with cargo to and from Latin America up more than 38 per cent, with North America retains its position as the biggest market, with volumes 15.8 per cent higher than last year. Heathrow Airport chief executive officer, John Holland-Kaye says the figures show Heathrow remains the gateway to the UK saying: “To keep Britain competitive, we need expansion to build more connections for British passengers and exporters and we are glad to see the Government pushing forward on the next stages of the delivery. Together we are showing the world the UK remains open for business.” Cargo was up 9.1 per cent in the first six months of 2017 to 823,322 tonnes and 6.7 per cent to 1.6 million tonnes on a rolling 12-month basis. American Airlines Cargo opened a new expanded pharmaceutical facility at Heathrow in June, and the airport launched the ‘World of Opportunity’ programme with the Department of Inter-
national Trade to encourage British SMEs to export abroad. Secretary of state for transport, Chris Grayling says the government remains committed to expanding Heathrow, saying the project has widespread political support. The airport continues to develop its plans and there will be further opportunities to give views during the public consultation later this year, which is part of the Development Consent Order planning process.
Freighter traffic fall at Brussels
TONNAGE at Brussels Airport fell in June with a major fall in full freighter traffic as airlines departed due to stricter noise standards. The hub serving Belgium’s capital handled 42,375 tonnes in June, up 5.3 per cent on the 40,243 tonnes processed in the previous June though down 1.9 per cent on two years ago, when it was 43,187 tonnes. Full freighter traffic declined 3.1 per cent year-on-year (YOY) to 11,524 tonnes and by 16 per cent compared to 2015, when it handled 13,726 tonnes, with Yangtze River Express and Air Cargo Global leaving due to stricter noise standards. Integrator traffic has remained strong, with a six per cent YOY increase to 19,191 tonnes and up 11.7 per cent on 2015. Belly cargo is up 13.8 per cent to 11,660 tonnes compared to last year though down 5.1 per cent on 2015 due to Jet Airways leaving, though Brussels Airlines flights to Mumbai have partly compensated for the loss. Cargo volumes have increased 16.4 per cent YOY in the first six months of 2017 to 268,316 tonnes, with 18.1 per cent full freighter growth and belly cargo up 11.7 per cent.
System upgrade for Celebi Delhi CELEBI Delhi Cargo terminal has gone live with Kale Logistics Solutions’ Galaxy (domestic module) Cargo Management system. This is part of the phased implementation of the entire suite of the Galaxy Air Cargo management software system comprising of EXIM operations, warehouse management, UD, invoice and accounts and domestic operations. The domestic module incorporates next generation features like mobile app, customer portal, hand-held based app and EDI with airlines. Celebi Delhi Cargo Terminal Management India is a joint venture between Delhi International Airport Private (DIAL) and Celebi Ground Handling Turkey. Celebi Delhi Cargo terminal management chief executive officer, Ramesh Mamidala says: “Modern day freight challenges need technology to enable innovative practices to move businesses forward. With our domestic operations going live on Galaxy, we look forward to greater automation of our operational processes and getting quick and comprehensive information on consignment and cargo tracking. “This significant development will help to speed up shipment times, improve efficiency and reduce costs.”
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NEWS WEEK Prime Day in the US flies high for Amazon
mazon’s Prime Day was the biggest in its history for sales, and it was fuelled by the e-commerce giant’s fleet of Prime Air aircraft. The annual event took place for 30 hours from Monday, 10 July and is one of the biggest online retail days in the US shopping calendar. Third-party sellers sold over 50 per cent more items on the site by noon local time than in the same timeframe last year, Amazon said. The company has not disclosed sales figures, but it was estimated last year’s event brought in well over $500 million. During Prime Day, Amazon Prime members received unlimited free two-day, one-day and same day shipping on over 50 million items in more than 5,000 cities and towns, and two-hour delivery with Prime Now across 30 major cities. Ahead of the Prime Day sale Amazon announced: “Prime Air cargo planes are fuelled and ready to support Prime Day in the United States for the first time.” Amazon’s Prime Air fleet is made up of of 25 aircraft including Boeing 767-300s and 767-200s which are leased from Atlas Air and ATSG, and has another 15 more freighters on order. Amazon is also expanding its fulfillment centres in the US and
announced on 10 July it would be opening an 850,000 square foot facility in Orlando, Florida. This comes after the online retailer said on 5 July it would open its first Utah fulfillment centre in Salt Lake City. The facility will be spread over 855,000 square feet.
Most TNT services back on track
TNT says most services are back to normal and it is working hard to clear any backlogs following its IT systems being hit by a virus. Operations and communications were disrupted when a ransomware cyber attack swept the globe, affecting numerous companies, though TNT says no data breach occurred as far as it is aware and operations of other FedEx companies are unaffected. The company says: “TNT continues to make significant progress in resuming full services and bringing critical systems back
online. These remediation efforts are being carried out methodically to ensure the integrity of TNT’s information systems and operations.” TNT says contingency plans making use of FedEx Express and TNT networks will remain in place to minimise the impact to customers . However, the express freight operator warns that some customers may continue to experience delays in service and access to package information.
SWISSPORT Canada has signed a contract with Mexican carrier Interjet to provide ground handling services for operations at Montreal Trudeau International Airport and Toronto Lester B. Pearson International Airport. Swissport will provide ground handling services including passenger and ramp handling, baggage services, operations coordination and load control. Montreal services will start on 13 July 2017 and Toronto will follow shortly after on 28 July 2017. THE International Federation of Freight Forwarders Associations (FIATA) has welcomed 78 new members from across the world in May and June. These included five new members from Saudi Arabia including Pivot Logistics, three from Turkey including Marti Container Services, and three from India including Ryder Shipping Lines. FIATA also welcomed members from Bangladesh, Cameroon, Djibouti, Georgia, Haiti, Italy, Jordan, Lebanon, Morocco, Senegal, Tunisia and Ukraine .
Volga aids Nippon Express in Japan
VOLGA-Dnepr Airlines was on hand to help Nippon Express when it urgently needed to move 197 tonnes of sensitive automotive machinery from Japan to the US. Hanoi-based load planning experts were on hand to assesse the cargo and prepare the most efficient plan for its delivery from Tokyo to San Francisco, with the outsize shipments flying on four Volga-Dnepr AN124-100 freighter flights. The engineers in Hanoi developed recommendations for cargo packaging, including giving advice on securing the machinery to the AN-124-100’s cargo floor, and confirming the requirements to transport the cargo in low air pressure conditions to protect the
integrity of the shipment. Volga-Dnepr’s representative in Japan, Hiro Tsukada says: “Given the need for a fast response for this delivery, the fact that we have a full team of planning specialists located in Hanoi to serve customers in the Asia Pacific region was another big advantage we were able to provide.” “Having local experts in the same time zone as our customer made our cooperation even easier and meant we could reduce the required planning time and meet the short delivery deadline.” Nippon Express representative who managed the delivery from Tokyo to San Francisco, Makoto Hayashi says: “My special regards to Volga-Dnepr’s engineers and load planning specialists who developed the packages that provided maximum safety during the transportation of the highly sensitivity equipment. A rapid response by the airline’s team helped us to carry out our obligations to our customer within a challenging timetable.”
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Initiative finds security can be upped without major cost impact
ir cargo supply chains can be made more secure without a major impact on costs while increasing throughputs and reducing processing times at major air cargo terminals and airports, a Eurosky initiative has found. The European Commission funded scheme aims to provide air cargo security solutions while improving operational efficiency to reduce costs and lead times, and it has been working with Athens International Airport to act as a demonstrator to implement solutions. The endeavour at Athens was to provide a solution to form a systematic solution for the local cargo cluster; improve operational efficiency through increased and instant information flow among participants. Other aims and objectives were the consolidation of transport and cargo handling events, and production of statistics; and ensure a higher level of security down the air cargo supply chain through the application of information services from the seaport to the airport.
The demonstrator was said to prove by applying Eurosky’s dashboard solution in Athens could result in benefits including enhanced process flows from the seaport aided by incorporated notifications and early reaction by all stakeholders through real time information sharing and automated or corrective actions. Other plusses the initiative found was being able to consolidate information from different sources through a web-based dashboard, enabling facilitated inspection and clearance procedures and the monitoring of intermodal fast-lanes; and a predefined sequence of events through automated monitoring of the appropriate sequence and compliance between the airport and cargo handlers for handling sea-air cargo. The benefits are cornerstones of Athens’ SEAnAIRgy concept to provide synergies amongst all parties involved in combining sea and air traffic, and would further increase efficiency of required interfaces and practically automate the procedural flow. Eurosky says the benefits could also bring tangible benefits including reducing man effort by the cargo handler, freight forwarder and airport customs.
More flights from Canada to Thailand CANADA and Thailand have modernised their air transport agreement, meaning up to 21 flights per week between the two countries. The modernised agreement allows any number of Canadian and Thai airlines to serve any city in Canada and Thailand, establishing 21 flights per week for country, also enhancing rights allowing airlines to extend services to third countries (known as fifth freedom rights) on up to seven of the 21 flights. Minister of transport, Marc Garneau says: “An expanded agreement with a growing international air transport market like Thailand not only benefits our air sector, but also Canadian businesses, shippers and travellers who will now have more options.” Minister of international trade, Francois-Philippe Champagne says: “Expanded air transport links are yet another sign of the
growing ties between Canada and Thailand, which contribute to deepening our trade relationship. Our government is committed to facilitating the movement of goods, services and people to help Canadian businesses expand, compete and succeed in markets around the world.” The agreement was reached under Canada’s Blue Sky Policy, encouraging long-term, sustainable competition and development of international air services, and pending formal ratification procedures, the agreement is being applied on an administrative basis to allow carriers to begin planning new air services.
FedEx and Boeing to run eco test flights BOEING and FedEx Express are to work together to fly the next ecoDemonstrator aircraft, using a new Boeing 777 Freighter to test emerging technologies. The ecoDemonstrator program, now in its fifth iteration, serves as a testbed to improve environmental performance and safety of future aircraft. This round includes installing a compact thrust reverser to save fuel, flight deck improvements that can improve efficient operations in and out of busy airports, and flying prototype parts using cutting edge manufacturing techniques that reduce material waste.
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Boeing Commercial Airplanes vice president of product development, Mike Sinnett says: “The ecoDemonstrator program is focused on harvesting exciting new technologies that will benefit our airline customers, the flying public and the environment.” FedEx Express president and chief executive officer, David Cunningham says: “FedEx is committed to developing and implementing innovative solutions that connect the world responsibly and resourcefully.” Flight testing between Boeing and FedEx will last about three months before the aircraft returns to the FedEx fleet.
UK proving fruitful for Emirates Record year so far for Munich
mirates is celebrating 30 years of UK operations, providing UK passengers and cargo links to the world since the first flight from London Gatwick Airport on 6 July 1987. The airline started the service in 1987 using an Airbus A310, at a time when it had six aircraft in its fleet and six other destinations. The UK network has since grown with flights to Manchester in 1990, Heathrow in 1991, Birmingham in 2000, Glasgow in 2004 and Newcastle following in 2007. Emirates SkyCargo flies 140,000 tonnes of cargo in and out of the UK in an average year, with key commodities including Scottish salmon, whisky, oilwell parts, healthcare and pharma products, and British food. The carrier has also carried 60 luxury vehicles from Heathrow using its new
SkyWheels service since 1 April. Emirates UK vice president, Laurie Berryman says: “The last 30 years have been an incredible journey for us at Emirates. “We’ve grown our UK presence to serve more passengers with the latest, most comfortable widebody aircraft, flying more people and more British exports to more places around the world.” Emirates operates Airbus A380s on all six daily flights from Heathrow, all three from Gatwick and Manchester and one of its three from Birmingham, with all other flights operated by Boeing 777s. A 2015 study carried out by Frontier Economics found that Emirates flights to and from the UK had a GDP impact of €2.7 billion and supported 29,700 direct, indirect and induced jobs in the UK.
FREIGHT volumes have hit an all time high at Munich Airport, handling 180,000 tonnes in the first half of 2017. The sector has grown nine per cent yearon-year and comes as passenger numbers top 20 million in the first half of the year, the same number as it handled for the whole of 1999. Munich Airport says the outlook is positive helped by strategic moves by the Lufthansa
Group to station the first 15 of its 25 new Airbus A350s in Munich, which will be joined by five Airbus A380s in the summer of 2018, and the decision by Eurowings to station aircraft in Munich. The airport has been open for 25 years, and Munich Airport president and chief executive officer, Dr Michael Kerkloh says the hub is “looking stronger than ever before”. He says: “With the foreseeable increases in intercontinental traffic, our high-quality airport will attain a new standard of quality in the coming years. We will then be equally well positioned as a hub across all traffic segments.” “We’re now in the enviable position of being poised to add more chapters to our success story for the next 25 years – in the interests of Bavaria and the people who live here.”
Long-haul routes boost Gatwick tonnage NEW long-haul belly connections continue to drive cargo figures at London’s Gatwick Airport. The UK gateway handled 7,835 tonnes in June, a 20.6 per cent rise on June last year when Gatwick handled 6,494 tonnes. On a rolling 12-month basis from July 2016 to June 2017, tonnage is up 18.2 per cent to 85,214 tonnes, a rise on the 72,082 tonnes in the previous 12 months. The single runway gateway now has 60
long-haul connections as new routes to Seattle, Austin, Denver, Chicago by Norwegian. Meanwhile, China Airlines will start a four times weekly service to Taipei from 1 December 2017. Gatwick Airport chief executive officer, Stewart Wingate says the airport continues to play a vital role in bringing Britain and the world closer together as more and more destinations are added to the range of long-haul services offered.
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NETHERLANDS Community approach and cargo initiatives paying off at Schiphol
-commerce, pharmaceuticals and perishables helped propel Amsterdam Airport Schiphol to year-on-year (YOY) tonnage of 8.5 per cent in the first five months of 2017. In May alone, there was a YOY uplift of 12.3 per cent and head of cargo, Jonas van Stekelenburg (pictured) says the gateway is happy with the progress as various initiatives are paying dividends. He points to various factors for the increase this year: “There has been an uptick of the economy in the European Union, Asia and the US. Also special
things have boosted tonnage such as the Hanjin Shipping collapse in Asia.” Asia has fuelled the industry’s rise this year and Schiphol has benefitted as has an extensive route network into the region. In the first five months of 2017 incoming traffic from Asia was up 7.1 per cent and outgoing up 11.7 per cent. Another boost has been from Latin American incoming traffic, which is up YOY by 34 per cent with perishables making up most of the tonnage. Cargolux Airlines has been one of the chief reasons for the surge as it has been operating more flights each week into the region. The US is the one region showing contrasting figures and the strong US dollar is likely to be behind the incoming YOY tonnage fall of 7.8 per cent, but exports from Schiphol to the US are up YOY by 12.8 per cent.
Africa has seen falls in both imports and exports at four per cent and 15 per cent, respectively, but van Stekelenburg cannot pin-point why there has been a decline, but notes it is a “little bit worrisome”. As for how different verticals are performing at Schiphol - pharma, perishables and e-commerce continue to thrive this year and be the rocks that growth is being built on. The Pharma Gateway Amsterdam (PGA) community initiative has boosted the pharma supply chain and helped tonnage grow five per cent in the first five months of 2017. “In terms of volumes it is not the biggest vertical, but the value is very interesting. We put a lot of emphasis on pharma and the whole community will profit from what we do. Through the PGA, everybody is working closer together and we have had more members and hope for more.
Improved pharma quality
“There is a lot more emphasis on maintaining high standards and performance in the whole supply chain and cooperation between the different partners is much better. PGA has improved the quality and we are very happy with that,” says van Stekelenburg. E-commerce is a more difficult sector to monitor in terms of tonnage, but van Stekelenburg explains Schiphol is seeing a big uptick in Customs declarations. “What we see is there is a shift from big shipments to smaller shipments, which is the e-commerce traffic. It is very important and we are doing things to facilitate e-commerce,” he says. Last year, Schiphol teamed up with Dutch Customs for a simplified e-commerce declaration called VENUE, to help shippers import and export items purchased via e-commerce platforms throughout the Union Customs Code transition period, which ends in January 2021. VENUE-authorised shippers can submit a pre-declaration leaving out one or more particulars, and goods valued at €22 or less require no supplementary declaration. VENUE is available until the third quarter of 2019. As for perishables, flowers continue to be the biggest sector with most coming from Nairobi in Kenya, now Schiphol’s second biggest cargo
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destination after Shanghai. Flowers van Stekelenburg says are in the “DNA of the Netherlands” and the Holland Flower Alliance (HFA) it launched in March with KLM and Royal FloraHolland aims to ensure the Aalsmeer-Schiphol region remains the world’s top flower-trading centre. HFA aims to create a seamless chain ensuring the highest product quality and fastest transport times in the most cost-efficient way. The focus is on the main flower-importing country - Kenya. The HFA is in its early stages, but van Stekelenburg hopes in the fourth quarter of this year to report on some interesting results that the alliance has yielded.
Much of the overall growth at Schiphol he also believes is down to the cooperative approach of Dutch Customs and the strong relationship that the airport has with the department. Meetings are held with Customs every four weeks to iron out and solve any issues in the supply chain notably for perishables and pharma. Another key focus area is to grow by optimising aircraft movements as the hub cannot expand until 2019 due to noise restrictions, and van Stekelenburg says the target is to increase the load factor, which is at 60-70 per cent. Meanwhile, the ‘Milk Run’ initiative launched in 2015 continues to pay dividends. The concept aims to reduce CO2 emissions by replacing forwarders’ truck collections from handling agents with a single delivery. The scheme also optimises the inbound supply chain by streamlining the delivery of import shipments from handling agents to forwarders’ warehouses while improving service for forwarders’ and efficiency of the supply chain. The ‘Milk Run’ has been further optimised and traffic is increasing, van Stekelenburg says. “It is a very good thing and everybody is sharing from the same truck. The community approach and cooperation means there is so much trust and even the sharing of airfreight. It has grown a lot since it was started,” he explains. Schiphol looks set to continue to thrive led by increasing cooperation in its cargo community.
NETHERLANDS Digital innovations and flowers high priorities for AFKLMP
ir France-KLM-Martinair Cargo (AFKLMP) is focussing much of its energy on digitisation and innovation. The launch of myCargo is contributing to its ambition to innovate customer service by offering relevant and improved digital services. A personalised toolkit for customers, namely employees working at freight forwarders, myCargo is a portal where customers can make bookings, quote requests, track & trace, do e-claims, and perform other services. Digital program director, Frédérique Pelger (pictured) says more service features are being added to myCargo and in the coming period it plans on having a messages centre in place. “In this myMessages functionality, customers can manage themselves the notification they want to receive on their shipment status plus in the future like receiving a booking confirmation. “Another new service will be our myRates services. In myCargo we will provide you with a personalised rate overview, containing your price agreements, market rates and promo rates. In the near future we want to include an overview of the other charges as well,” Pelger explains. She says AFKLMP believes in the strength of combining personal and digital services, and myCargo offers fast and easy offers and servicing and is transparent and real-time. “The services will be enhanced and improved over time, based on the feedback of the user so we really support the customer’s efficiency and experience,” Pelger says. As AFKLMP is aiming to be one of the innovators in air cargo, she believes myCargo is one of the front-runners in the industry and the Group has only received positive feedback from customers. Pelger says: “myCargo is focused on the individual user. We show in one envi-
ronment all relevant information the user uses on a daily basis. Our customer can manage shipments via myCargo, like checking the status, making bookings and requesting quotes. It is a very interactive way of making a booking.” She believes myCargo is easy to use and the customer is in control on every aspect of their shipment 24/7 and it offers customers the best available rate while requesting a quote. AFKLMP’s objective is to deliver services in a transparent and easy to connect way, at a competitive price. Pelger says digital innovations are contributing to the transparent service offering. “We aim to develop the most easy, simple and reliable services for both our customers and our employees; leading to simplicity and efficiency in all the processes,” she adds.
Another high priority is flowers and KLM recently launched the Holland Flower Alliance (HFA) with Amsterdam Airport Schiphol and RoyalFloraHolland. KLM Cargo project manager for the HFA, Hedwig Sietsma says it was started to combine the knowledge each has to provide a product of better quality. “Our goal is to realise a seamless chain that will ensure the highest product quality and fastest transport times in the most cost-efficient way,” Sietsma says. The HFA is focusing on Schiphol’s most significant import flow for flowers – Kenya - where it moves mainly roses, but other important flows will be taken into the scope. The busiest import trade lanes for flowers after Nairobi are Quito and Bogota. She says besides providing advocacy and promoting Holland’s role as the world’s leading flower hub, the major focus of the HFA is to identify ways to refine the supply. “The aim is to learn how cooperation works in the whole chain, from farm to florist, and use this to improve our processes,” Sietsma adds. To achieve this,, the HFA is focusing on different topics including
process innovation; information sharing; packaging; branding; and governance. Schiphol takes the lead in the information sharing part, RoyalFloraHolland in the packaging part and AFKLMP Cargo in the process innovation part. But what are the current trends? “The trends we see that are important to the HFA are firstly trends that develop in the logistical chain. We see the vase life of flowers, and therefore a quick and smooth cool chain, becomes more and more important. We also see more focus on innovative, strong and lightweight packaging,” Sietsma says. Sietsma adds: “Secondly, another trend is the issue of sustainability emerging in the consumer market. By reducing our waste by innovating the cool chain and innovating packaging we can also play our role in this.” Sietsma believes the biggest opportunity in the market is the quality of the product it offers, and increasing this together with the whole chain along with exporting flowers: “AFKLMP’s large network coverage and direct connections offer great opportunities to increase the export of flowers outside of Europe.” Schiphol is Europe’s top flower hub, but Frankfurt and Liege are growing their business while Middle Eastern hubs are expanding. Sietsma says to maintain the lead it needs to remain “innovative and on top of our game” which is where the HFA comes in.
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INDIA & SRI LANKA
India’s middle class drive demand for high-end goods
he growing middle class in India is driving demand for high-end goods such as electronics, IAG Cargo regional commercial manager APAC, India & Middle East, Pravin Singh tells Air Cargo Week. He says demand for consumer electronics, comprising mainly of smart phones, is being driven by the vast millennial population and growing middle class, while high end fashion and retail imports are growing as more big brands open stores in India. Gold and jewels are also important imports, for conversion into finished jewellery within India and re-exported as well as to cater for growing domestic demand. The automotive industry is also extremely important for India, Singh explains: “The boom in high-end car ownership has meant we have
seen a correlating increase in the shipment of automotive spare parts into India and we’ve also seen a rise in medical equipment imports for the growing medical industry.” Ready made garments are a significant export from India and Sri Lanka, with ocean capacity constraints increasing demand for airfreight. Other sectors have also performed well, Singh says: “Automotive and industrial spare parts have also seen high demand while pharmaceutical shipments continue to remain strong through our Constant Climate product. The second quarter was buoyed by high volume perishable exports on the back of a bumper mango season from India.” There has been high demand for expedited and time-sensitive freight across India and Sri Lanka, Singh comments: “We have seen double digit year-on-year growth across our premium
business including our time sensitive product, Prioritise, our temperature sensitive product Constant Climate and Critical our emergency, must fly offering.” This has been helped by limited ocean freight capacity, Singh says: “This strong performance is a result of both constrained ocean capacity and general increased demand for Indian-originating freight. Unusually strong trading conditions have seen ocean carriers divert capacity, causing constraints which have in turn been served by air freight.” Singh expects the Indian and Sri Lankan markets to continue growing as governments create a better trading environment and improve infrastructure to retain their competitive edge and boost exports. He admits infrastructure remains a key challenge, though says the Indian government is making investments and taking action to help
boost exports. Singh says: “The recently introduced GST (Goods and Services Tax) aims to remove complexity and create a uniform and standard application which is expected to create greater efficiencies.” India’s national civil aviation policy made reference to air cargo for the first time in 2016, detailing initiatives designed to promote growth in the air cargo sector and aligned to the government’s ‘Make in India’ initiative. Singh comments: “This a positive sign that the Indian government recognises the value that air cargo offers in terms of boosting India’s export capabilities.” He is confident about ‘Make in India’ increasing manufacturing and leading to higher demand for Indian produced goods, saying: “From our perspective we will look to support this growth market, creating bespoke products that help deliver on our customers’ needs.”
Opportunities ready for exploiting USING Sri Lanka as a transit hub for cargo into India is an opportunity to be exploited, Fits Aviation believes. The company says using Sri Lanka in this way capitalising on e-commerce movements requiring rapid delivery is particularly important, but this opportunity has yet to be completely exploited. Sri Lanka also has capacity issues, Fits Aviation explains: “There is enough capacity to uplift general cargo and perishables. However there is a shortage of dedicated freighters for the movement of DGR and outsized cargo, livestock in particular.” FitsAir mainly operates scheduled freighter flights using an MD82, but is also into cargo network management with a dedicated interline team and SPA’s with over 30 airlines. It has block space agreements with carriers into destinations such as Bagram and across India originating from the UAE. The airline says: “We operate schedule/ non-scheduled freighters into Bangalore, Delhi, Mumbai, Karachi, Dhaka, Chittagong
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etc. Moreover, we manage the capacity of our own freighter into Male twice a week.” Most of its flights are charters on a scheduled basis though says ad-hoc charters have not been as strong. Fits Aviation says: “However there are multiples charters that do take place into Europe and North America with aircraft of larger capacity.” It says: “Our strongest sectors are regional into Bangalore and Male, a lot of connecting and network traffic in generated on these routes. The MD-82 undertakes feeder flights for cargo from the Far East.” Capacity is growing across Sri Lanka with passenger flights offering cargo space. Garments travel to North America using Emirates and Qatar Airways flights with Cathay Pacific, Etihad Airways and Turkish Airlines have dedicated freighter services to Colombo. Fits Aviation comments: “The biggest challenge would be to disciplined on capacity, currently we see a trend of shrinking yields.”
INDIA & SRI LANKA
Government reforms helping the Indian market grow
manufacturers and faster availability for the end customer. He adds: “As a GSA, we will be part of the growth as carriers will increase their frequency or bring in wide body belly capacity and operate into new markets.” M&C Aviation has joined the new GSA network, 1GSA, and Shah expects this to help business. He says: “We as M&C Aviation benefit with this membership as it helps us to interact with other members in the network wherein we as M&C are not represented in certain part of the globe and can support each other in their respective markets as well as look out for new opportunities benefitting us.” The company has 32 offices in 19 countries, and continues to grow. Shah says: “We can service our customers from any of these countries and that in itself is an advantage to the carriers and customers. Being a member of 1GSA will further assist M&C Aviation in their growth path through the growing network of members in its fold.”
he Indian airfreight market will continue to see strong growth, general sales agent (GSA) M&C Aviation India chief executive officer, Harish Shah (pictured) tells Air Cargo Week. Shah says 2017 has started well in India with 18.5 per cent year-on-year growth from January to May, and the whole company has also performed well, gaining an additional airline contract during the first half of 2017. Having already seen substantial growth in India this year, Shah is confident about the rest of 2017, saying: “Implementation of GST (Goods and Services Tax) will need to be watched but do not foresee this affecting the overall business.” Reforms are expected to help airfreight grow, Shah comments: “The Government and various departments within have been supportive of the growth and finding ways and means to streamline and simplify the working process in co-ordination with the manufacturing sector and air freight Industry.” Shah believes this initiative will lead to shorter cycle times for
Extra capacity fuels growth at Jet Airways
EXTRA capacity has fuelled growth at Jet Airways, particularly for premium products, senior vice president – cargo, Pradeep Kumar tells Air Cargo Week. He says demand for worldwide airfreight continues to be “robust”, and Jet Airways has been feeling the affects in the first half with strong demand for capacity. The momentum from the first half is expected to continue with Kumar commenting: “The domestic market is expected to grow by six per cent over last year and with the strong economic forecast, exports and imports to/from India are expected to grow by approximately 4.7 per cent over last year.” He says Jet has been able to grow due to introducing wide body aircraft on both international and domestic routes, providing direct capacity between India and the Far East, the Gulf and Europe. Kumar says: “Deployment of wide body capacity between metro cities within India has helped provide seamless connectivity and distribution for time definite cargo. Increased direct capacity has fuelled the growth in pharmaceuticals and perishables such as flowers and food items.” Jet has been busy upgrading aircraft on routes to Amsterdam and Paris, and new routes from Bengaluru to Singapore, Bengaluru to Colombo and Delhi to Muscat. Other services have been increased, including Delhi – Doha, Delhi – Dubai, and Mumbai – Kathmandu, as well as higher domestic network frequencies. Other route upgrades include new Chennai – Paris, Bengaluru – Amsterdam services, a third Mumbai – London flight from 29 October, a second Delhi – Singapore service and using a Boeing 777 instead of an Airbus A330 on Mumbai – Paris flights. The UK Brexit vote has not had an impact on business, and Kumar comments: “[The] UK continues to be a major trading partner of India and the new tax reforms undertaken by the government by the implementation of the Goods & Services Tax (GST) i.e. One nation One Tax, is expected to further fuel growth.” India’s GDP is expected to grow by more than seven per cent this year, with exports increasing and a stronger domestic market. Some things need to be improved including infrastructure, though there have been positive developments. Kumar says: “Factors expected to facilitate growth and opportunities include continuing the progressive outlook of the Government supported by expedited clearances of infrastructure projects / industry and increased FDI inflows.”
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ACMI AND FREIGHTERS ACMI agreements signed globally in the last few months
he ACMI (aircraft, crew, maintenance and insurance) marketplace has been quite active over the last few months with a number of agreements penned. Earlier this month, Air Transport Services Group (ATSG) subsidiary Cargo Aircraft Management (CAM) announced it was to lease three Boeing 767-300 Freighters to Northern Aviation Services (NAS) to be operated by Northern Air Cargo (pictured). CAM will lease three 767-300Fs to NAS for seven-year terms beginning with the first lease in October 2017, with the potential for additional 767-300Fs in 2018. The aircraft will be used by brands Aloha Air Cargo based in Hawaii, Florida-based StratAir, and Alaska-based Northern Air Cargo. Some of the leased 767-300Fs will replace CAM-owned 767200/300Fs operating on an ACMI basis under ATSG’s Wet-2-Dry program, which allows carriers to prove their business case for 767Fs under ACMI arrangements, then transition to long-term dry lease agreements.
In June, Atlas Air Worldwide announced the ACMI placement of a Boeing 747-400F with Yangtze River Airlines – a subsidiary of the HNA Group in China. The 747-400F will be operated by Atlas Air, and will fly on behalf of Yangtze River Airlines through an ACMI agreement. The new service started last month and will serve routes between China and the US. Yangtze River Airlines president of cargo business units, Jevey Zhang said it was a “great beginning of HNA Modern Logistics Group launching its global strategy”. In May, Atlas Air also placed two Boeing 747-8F into ACMI service for Cathay Pacific Cargo. The aircraft will be operated by Atlas Air and will fly on behalf of Cathay Pacific Cargo through ACMI agreements. The 747-8F service begun in May, and will supplement capacity
Cathay Pacific Cargo’s existing network. In April, Pacific Air Cargo (PAC) introduced a converted Boeing 747-400F between Los Angeles and Honolulu. The former passenger aircraft, under an ACMI agreement with PAC’s long-time lessor partner Kalitta Air, will fly a six-times a week service previously operated by a B747-200F aircraft. PAC provides express cargo services between Los Angeles, the Hawaiian Islands and American Samoa. The carrier also upgraded its weekly service from Honolulu to Pago Pago in American Samoa, from a B727F to a recently converted B757F.
NAM renews with WGA
NETWORK Airline Management (NAM) has renewed its contract with Western Global Airlines (WGA) to operate Boeing MD-11 Freighters. WGA will continue to operate up to three MD-11Fs on behalf of NAM with operations based in Liege, Belgium, supporting NAM’s operations with Allied Air of Nigeria, as well as scheduled cargo services throughout Africa. Network Aviation Group group chairman, Andy Leslie says: “Our renewed contract builds upon an already strong and successful 4-year partnership between Network Airline Management and Western Global Airlines. “The new, long-term agreement will enable us to strengthen and expand our route network in the future as we take further aircraft, and complements our B747-400F aircraft that we offer via Astral Aviation in Kenya.” WGA chief executive officer, Jim Neff says: “Western Global Airlines is proud to serve Network Airline Management and its customers with our efficient fleet of MD-11 aircraft, and build upon our relationship and position in the market as the leading provider of MD-11 air cargo capacity.”
AHK now a Cathay subsidiary AIR Hong Kong (AHK) is to become a wholly owned subsidiary of Cathay Pacific Airways, it was announced in a filing on the Hong Kong Stock Exchange. The non-binding memorandum of understanding will involve Cathay Pacific Group and DHL Group entering into the Share Transaction for the former to purchase the minority interest, AHK and DHL entering a sale and leaseback transaction for freighter assets, and AHK and DHL to enter a block space agreement. Under the old block space agreement, AHK sells space to DHL on an agreed network of overnight freight routes. The transaction is expected to take effect on and from the expiry on 31 December 2018 of the joint venture agreement and the old block space agreement. Cathay Pacific already had a 60 per cent share of the company, with DHL controlling the other 40 per cent, with affairs being governed by a joint venture agreement. In October 2002, Cathay Pacific entered into a business partnership with DHL Express to develop the express freight network in Asia, and AHK’s network now includes Bangkok, Singapore, Tokyo, Seoul and Manila, among others. DHL Express is AHK’s main customer and the bulk of the cargo is express parcels, with the remaining classed as general freight.
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NEWSWEEK Strong 1H of 2017 for Frankfurt Pharma standard for Amerijet
rankfurt Airport volumes have been strong throughout the year, and cargo is up 4.8 per cent to just under 1.1 million tonnes in the first half of the year. Other Fraport operated airports have seen mixed results, with Ljubljana Joze Pucnik Airport in Slovenia grew 18.7 per cent in June to 1,043 tonnes, and by 13 per cent to
5,655 tonnes in the first six months. Lima’s Jorge Chavez International Airport in Peru dipped 1.4 per cent in June to 19,909 tonnes and was up 0.1 per cent in the first six months of 2017 to 122,681 tonnes. Both Bulgarian airports saw growth, with Burgas up 7.9 per cent to 1,185 tonnes in June and three per cent to 6,715 tonnes in the first six months, with Varna increasing 2.8 per cent in June to 11 tonnes and 57.9 per cent to 148 tonnes in six months. Fraport’s other German airport, Hannover-Langenhagen Airport was down 27.8 per cent in June to 1,121 tonnes and 8.5 per cent to 8,864 tonnes in the first six months. In China, Xi’an Xianyang International Airport rose 20.8 per cent to 21,630 tonnes in June and 11.1 per cent in the first six months to 122,513 tonnes.
AMERIJET International Airlines has become the first all-cargo airline to earn IATA CEIV Pharma certification, receiving the certificate on 27 June. The airline has invested heavily in technology, infrastructure and processes over the last few years to ensure safe handling and transportation of high-value and temperature sensitive cargo. The airline transports over 136 million kilogrammes of freight a year including 30 million kilogrammes of temperature controlled products. Amerijet’s Temperature Controlled handling facility at Miami International Airport includes a custom-built cooling facility equipped with active alarm systems, temperature data recorders and 24/7 CCTV monitoring. Computer monitored pharmaceutical cooling chambers provide storage environments for ambient 15-25C, chilled 2-8C and frozen -0C shipments. Amerijet International Airlines president and chief executive officer, Vic Karjian says: “Being the first all-cargo airline from the US to receive the Center of Excellence for Independent Validators in Pharmaceutical Logistics is a direct result of hard work and the investments we have made over the last
few years to our Temperature Controlled program.” Amerijet vice president of airport operations, Rasheme Richardson adds: “Complying with the healthcare cold chain logistics standards, expected from pharmaceutical manufacturers and life sciences companies, helps to support the global healthcare initiative of putting patient safety first.” IATA global head of cargo, Glyn Hughes says: “We congratulate Amerijet for their achievement in meeting shippers’ expectations in terms of standardisation and transparency. “This will contribute towards developing a stronger, more competitive and enhanced air cargo service for pharmaceuticals in North and Latin America for this vital sector.”
IATA CEIV Pharma certificate for Delta Cargo DELTA Cargo has become the first global carrier based in the US to gain IATA CEIV Pharma Logistics certification. The International Air Transport Association Center of Excellence for Independent Validators (IATA CEIV) certification was awarded to the company at the headquarters level and at its Atlanta hub. Delta has created the first trans-Atlantic network connecting Atlanta with other CEIV Pharma certified partners, stations and handlers in Amsterdam, Brussels, Milan, Paris and Rome. Delta Cargo president and senior vice president for airport customer service, Gareth Joyce says: “The safe and efficient transportation of Pharma products for the healthcare and pharmaceutical industry is a key priority for us, as is the health and safety of patients who depend on them.” He adds: “Delta has made significant investments in the ensuring that our facilities, equipment, operations and staff comply with all applicable standards, regulations and guidelines expected from pharmaceutical manufacturers.” Delta’s joint venture partner, Air France KLM Martinair Cargo is also certified, and
the airline says this creates significant opportunities to transport pharmaceuticals across a global trade lane. IATA vice president airport, passenger, cargo and security, Nick Careen says the North American market accounts for over 20 per cent of global trade, and Delta gaining CEIV certification is good for the region. He says: “Having Delta Cargo, one of the region’s largest operators, achieve CEIV Pharma certification is a boost not only for the airline’s customers, who can be confident that their life-saving and temperature sensitive products will be delivered in impeccable condition, but also the region.”