ACW 29th October 18 by Azura International

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The weekly newspaper for air cargo professionals No. 1,005

29 October 2018

TIACA ACF 2018 Toronto

We were there so you didn’t have to be

OPEN FOR BUSINESS: THY’S CARGO HUBS

Pages 8-13

INSIDE AA CARGO SETS RECORDS

AMERICAN Airlines Cargo continues to outperform and exceed operational performance records ... PAGE 4

Exclusive

By Michael Mackey

urkish Airlines will operate a two airport cargo hub when the new Istanbul Grand Airport (IGA) opens today (October 29). Turkish Airlines, senior vice president of Cargo Marketing, Fatih Cigal, told Air Cargo Week. “We are going to operate with two hubs in the same city,” Cigal said in an interview in Istanbul on October 24. The new airport is due to hold its opening ceremony today. IGA will have a usable cargo area of 165,000 sq m with a handling capacity of two million tonnes a year by the end of its first phase of construction. This is set to rise to four million tonnes per year by 2023. Turkish plans for the just-to-open IGA to become its bellyhold cargo hub with Ataturk being rolled into a designated cargo facility. Linking the two will be a trucking operation with 150 trucks moving per day between IGA and Ataturk, a distance of some 45 kilometres due North of Ataturk.

DHL ON THE GRID

DHL Global Forwarding has provided FIA world touring and endurance racing cars with multimodal support ...

An artist’s impression of the new airport The carrier which owns 16 freighters outright 11 A330s and 5 B777s - and supplements them with three wet-leased B747s from Kallita Air acknowledges the plan will see its cargo operations grow only slightly next year “because we are going to lose some connections between our belly and freghters,” said Cigal. Mitigating this is a plan increase capacity to suit the new strategy better. “We took proper action in terms of capacity planning and sales,” Cigal told Air

Cargo Week. Currently one third of the carrier’s cargo needs to be moved from passenger planes to freighters but the carrier will reduce this to one less than one fifth, said Cigal. One example Cigal gave the newspaper was cargo coming in on the Shanghai freighter service then going on to a destination such as Brussels in Belgium as belly cargo. In future this will be transported all the way on its jourtney by freighter, said Cigal.

THE International Air Transport Association (IATA) is urging the UK and European Union to take drastic action to ensure air services continue, even in the event of no-deal Brexit. The call for action follows the release of the IATA commissioned report “Study of the effects of the United Kingdom leaving the European Union on airlines flying to and from the UK”. IATA director general and chief executive offi-

cer, Alexandre de Juniac says there are no fallback agreements such as the WTO framework available in a no-deal Brexit. He says: “The risks of not addressing these issues could mean chaos for interrupted supply chains. With less than six months to go, we have little more certainty than we did in June 2016.” Even during transition, shipments will be disrupted as new customs procedures are established.

PAGE 6 HONESTY PAYS FOR FEDEX STAFF

THREE FedEx employees have been awarded over $8 million of damages for being bullied when they raised ... PAGE 7

IATA: Brexit clarity needed as no-deal looms EMIRATES BOOSTS VIETNAM

EMIRATES SkyCargo has signed an MoU with the Investment and Tourism Promotion Centre of Ho Chi Minh City .... PAGE 14

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Fourth 747 joins CargoLogicAir fleet

argoLogicAir has marked another year of growth with the delivery of its fourth Boeing 747 Freighter. The 747-400ERF joins the fleet on an operating lease and will initially be used to meet customer demand on US routes. The delivery keeps CargoLogicAir on track with its five-year growth strategy, which is based on operating a fleet of five freighters by 2020. Chief executive officer, David Kerr says 2018 was the airline’s busiest year of operations with volumes and revenue doubling the first nine months. He says: “The delivery of our fourth 747F will enable us to meet peak season demand, especially in our core US market, and increase our options in terms of frequencies and new routes as we head into 2019. “We are continuing to consult with our customers to identify where they need maindeck cargo capacity and expect to be adding new destinations to our network in the first quarter of next year.” CargoLogicAir’s network is designed to support customers in key industry sectors requiring cargo services such as Houston and the United Arab Emirates for oil and gas shipments, Atlanta for

pharmaceutical, aerospace and automotive cargo, Mexico City for automotive parts and components, and Hong Kong’s e-commerce market to the UK and Europe. The airline’s fleet consists of three 747-400s and one 747-8 offering capacity of up to 139 tonnes as well as nose and side-door loading capabilities.

Jota Aviation takes to the sky bound for Liverpool

Jota Aviation’s cargo services have taken off with a BAE 146-300 taking a shipment of automotive parts to Liverpool. The aircraft, which has a payload of 12 tonnes, flew from its base at London Southend Airport and arrived in Liverpool ahead of schedule to pick up the load. Jota Aviation chief executive officer, Andy Green says: “The introduction of the freight variant of the 146 into our fleet has taken a lot of hard work across the whole team at Jota, and it was hugely rewarding for the team to see the first revenue flight depart, on time of course! “We have geared the operation around rapid response, with the customer given a price and schedule option within five minutes, with the aircraft departed within 90 minutes of confirmation.”

ACW ON THIS DAY

Aeroflot Cargo still to go stand-alone

Vol 9 Issue 39

30 October 2006

AEROFLOT has reaffirmed the launch of its wholly-owned subsidiary Aeroflot Cargo. Aeroflot Cargo chief executive Anrej Goryashko also said that the carrier’s European freighter capacity at its Frankfurt-Hahn hub would expand significantly by 2008 as a result of six leased MD-11 freighters replacing the four DC-10Fs currently based at the airport. The first 91-tonne capacity MD-11F is due for delivery at the beginning of July next year, with the remaining three being delivered in 2008. “The dedication of Aeroflot Cargo - our largest air freight customer - is another clear signal for our airport,” said Jorg Schumacher, Frankfurt-Hahn airport management spokesman.

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ACS flies 600 tonnes of aid to earthquake stricken Sulawesi

ir Charter Service has been busy helping governments and charities to deliver more than 600 tonnes of aid to Indonesia following the earthquake and tsunami on 28 September. The magnitude 7.5 earthquake and subsequent tsunami caused widespread damage in Sulawesi, with tens of thousands of homes being destroyed and hundreds of thousands of people left homeless. The death toll has exceeded 2,000 with thousands still missing. Group cargo director, Dan Morgan-Evans says ACS offices in the US, Asia and Europe have been heavily involved in the humanitarian effort on behalf of its clients. He says: “We have been flying in different types of much needed aid, such as shelter kits and water purifying tablets on a variety of aircraft types, including Antonov AN-12s, Boeing B757s and B777s. “There are a lot of aid supplies stockpiled in Malaysia and the surrounding area so, once the aircraft were sourced, many of the

operations have been swift. “We have flown in other relief goods from the Middle East and

Europe – in total, seven of our offices have arranged more than 20 charters to the region carrying a total of just over 600 tonnes.”

American Airlines breaks records American Airlines Cargo continues to break operational records with a record month in September. New routes, strategic capacity planning and exceptional team work from within the organisation led to the best September performance. The record setting month comes after the addition of Critical PPS, the new service option for shipments requiring a higher level of visibility with proactive monitoring and notifications from the Customer Experience team, access to a priority track and trace desk, the highest trace priority and a 100 per cent service guarantee. This follows on from a record-breaking second quarter moving 158 million kilos of freight, up 10 per cent on June 2017. American Airlines Cargo president, Rick Elieson says: “Our teams are working hard and producing better results than ever. Most im-

pressive to me is that while handling record volume, and amid an operationally challenging summer, we also delivered record high flown-asbooked performance and an industry leading customer experience. That is a truly fantastic accomplishment.”

B&H makes strategic appointments B&H Worldwide has made two strategic appointments with Gary Wilson becoming managing director of B&H Group and Mark McKenna promoted to head of global operations and quality. Wilson, who will continue to be based at the company’s London Heathrow headquarters, has spent the last three years working closely with B&H Group’s CEO Stuart Allen (pictured) on shaping the group’s strategic development including increasing B&H’s presence in Europe ahead of Brexit, expanding the Miami hub and the 24/7 Control Tower in Asia. McKenna’s new role, also based at Heathrow, will mean he takes the lead in standardising operations and service quality, improve produc-

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tivity and upholding B&H’s service delivery. Allen says: “These two individuals lead by example within our organisation and their new and enhanced roles will ensure our continued growth is underpinned by both strategic and operational excellence worldwide.”

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DHL leads the field in Japan

HL Global Forwarding has provided FIA world touring and endurance racing cars with multimodal support for races in Japan. The support was provided for the FIA World Endurance Championship (WEC) race at Fuji International Speedway and World Touring Car Cup (WTCR) at the Suzuka Circuit. To support the races, DHL is managing all transportation, customs clearance and ground handling for 36 race cars, spare parts and ancillary equipment covering everything from tyres to engines. Prior to the WEC race at Mount Fuji, DHL shipped cargo via ocean and airfreight from the UK and Germany to Tokyo before delivering the cars and equipment to the race circuits via road. The 6 Hours of Fuji WEC race took place on 14 October and was won by the Toyota Gazoo Racing team consisting of Mike Conway, Kamui Kobayashi and Jose Maria Lopez in a Toyota TS050 Hybrid. For the WTCR Race of Japan, which will be held from 26-28

October and consists of three races totalling 42 laps, a second set of vehicles will arrive via ocean freight direct from the previous outing in Wuhan, China. DHL Global Forwarding president and representative director for Japan, and CEO for North Asia and South Pacific, Charles Kaufmann says: “As with all of the motorsports events we support around the world, our goal remains the same: deliver the race’s critical ingredients with speed and agility, while also ensuring the utmost safety and regulatory compliance of these precious cargos. “Given the relatively tight scheduling between each championship’s events, we’ve also optimised our delivery patterns to ensure the cars move swiftly from their prior engagements to Japan before continuing on their global tours.” Immediately after each race, DHL’s teams load all goods to transport them from the circuit to the port and clear customs within 72 hours before sending them to their next outings in Shanghai for WEC and Macau for WTCR.

K+N achieves ISO 22000:2018 conformity

Kuehne + Nagel’s Perishable Handling Centre in London is the first to achieve conformity to the revised ISO 22000:2018 globally from BSI. BSI Group director – food EMEA, says Richard Werran says: “By combining the Plan-Do-CheckAct cycle to manage business risk with HACCP to identify, prevent and control food safety hazards, conformity to ISO 22000 helps organisations to reduce exposure to risk and improve safety, encouraging operational and organisational resilience. “Kuehne + Nagel’s achievement demonstrates to customers and suppliers that the organisation is committed to providing safe foods and services that meet statutory and regulatory requirements.” Kuehne + Nagel UK QSHE director, Brian Nealon adds: “Our customers, and fundamentally, the end consumer, expect each and every single touchpoint of the food supply chain process to be managed and governed in accordance with the highest of standards. As the first organisation to achieve conformity to the revised ISO

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22000:2018 standard globally from BSI, Kuehne + Nagel is absolutely delighted to be leading from the front.” Kuehne + Nagel has also released its nine month results, which has been a successful period for airfreight. Tonnage increased by 16 per cent to 1.3 billion tonnes and earnings before interest and tax (EBIT) up 19.4 per cent to 271 million Swiss francs (CHF). In the period, Kuehne + Nagel acquired perishable airfreight specialist Panatlantic Ecuador and fully integrated CFI Commodity Forwarders, a major perishable provider in the USA into its network. For the group as a whole, net turnover was up 13.6 per cent to CHF15.3 billion, with earnings for the period rising by 7.4 per cent to CHF580 million. Chief executive officer Dr Detlef Trefzger says: “Kuehne + Nagel has continued its dynamic performance from the first half of the year into the third quarter and achieved a very positive result for the first nine months of 2018.”

Mechanics awarded $8m damages for raising safety concerns

hree FedEx employees have been awarded over $8 million of damages for being bullied when they raised concerns about aircraft safety. A jury awarded aircraft mechanic Brian Gruzalski, mechanic supervisor Stanley Langevin and their manager Mark Collins the damages for their treatment after raising concerns about unsafe repairs. The jury were told FedEx reduced the time spent repairing aircraft by one third to increase profits. To reduce repair times, management pressurised mechanics to rush repairs and installed stadium-sized countdown clocks to count down the seconds and offered management bonuses for getting aircrafts out faster. Mechanics were forced to sign off unsafe repairs or not do repairs. Gruzalski and Langevin complained to management and filed alert line complaints about FedEx coercing mechanics to overlook important safety repairs. In response to the complaints, FedEx ordered Collins to write up mechanics who objected they were illegal retaliation. Collins

was told that if he did not comply he would be written up himself, which when responded “Then you are going to have to write me up”, FedEx did. Langevin stated: “I was losing sleep because FedEx was just covering up safety issues and harassing us for reporting the problems. By doing this, FedEx is risking the lives of the crew on board and those on the ground. It is very serious.” FedEx ordered other staff to watch Gruzalski and Langevin,

and submit written complaints about them with a senior manager threatening the former “that 50 angry men wanted to kick his ass, if he did not stop complaining about the unsafe repairs”. Gruzalski was dismissed from his job, Langevin was demoted for three years and Collins was denied a promotion to senior manager, which the jury found was retaliation. Trial counsel Shahane Martirosyan says the manner in which FedEx chose to defend the action was troubling, commenting: “As one example, FedEx presented an internal complaint against Langevin that FedEx used to demote him, but the employee FedEx claimed complained testified that he never complained about Langevin and instead had supported him.” Lead trial counsel Nancy Abrolat adds: “Throughout the hard, five-year fight to get to trial, FedEx refused to take any responsibility, and instead denied all wrongdoing. Hopefully, FedEx will take the jury’s clear message to heart that our community will not tolerate putting corporate profits above airplane safety.”

Growth to average 4.2%, Boeing predicts

Air cargo demand is forecast to grow 4.2 per cent over the next 20 years with e-commerce to continue to boom, Boeing predicts in its World Air Cargo Forecast. Speaking in room 205A at the Toronto Metro Convention Centre on 16 October during TIACA’s Air Cargo Forum, Boeing Commercial Airplanes managing director of market analysis and sales support, Darren Hulst (pictured) explained how the freighter fleet will grow, and how e-commerce will continue to be important. E-commerce is projected to grow 20 per cent annually until 2021, when it will be worth nearly $5 trillion. Hulst said: “One structural trend has been e-commerce growth, which has been 20-30 per cent per year depending on the market. The Chinese e-commerce market will be larger than the US and Western Europe combined by 2020 driving not only ground transportation but also freighter demand over the next decade.” The global freighter fleet is just under 2,000 units at present but this is projected to expand more than 70 per cent to 3,260 with Boeing predicting new production freighter deliveries being valued at $280 billion. It is predicted that 1,170 standard body and 500 medium wide-body passenger aircraft will be converted into freighter aircraft over the next two decades. Since the market picked up in late 2016, airlines have been busy ordering freighters, and they are going with Boeing. The Seattle-based company has sold 128 aircraft since January 2017, of which 80 were production freighters and 48 were conversions. Hulst says with Boeing having 90 per cent of the freighter market, he believes the company is well placed to capitalise on this growth. He said: “We have invested in our freighter family to help express cargo and general freight operators carry out their missions around the world. Whether it’s our 777 Freighter or our 737-800BCF programme, Boeing offers the most capable family of freighters with the best combination of payload, range and fuel efficiency.”

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tiaca acf review

Investing in trade and transportation

WE asked the Hon Marc Garneau, Canadian federal minister of transport, to provide an introduction to the ACF which we carried in the first TIACA daily we produced in Toronto. Here is an edited version of his contribution.

anada is a trading nation. One in six Canadian jobs depends on international commerce. For our economy to succeed, we have to ensure that our products have efficient access to key global markets. We can have the best products in the world, but if we can’t get them to our customers quickly and reliably, we will lose business to other suppliers. Air transport is the fastest way to get highvalue cargo to both domestic and foreign markets. In 2017, the total weight of air cargo processed through all Canadian airports, including domestic, trans-border and international airports, was more than 1.3 million tonnes. That year, Canadian airports handled exports worth $58.9 billion and imports worth $70.5 billion. Our government is well aware of the importance of the air cargo industry, and we are taking steps to make it stronger. In July of last year, we announced the Trade and Transportation Corridors Initiative. The core element of this initiative is the National Trade Corridors Fund, designed to

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help infrastructure owners and users invest in our roads, bridges, rail lines, port facilities -- and airports. These are the critical transportation assets that support the movement of goods and people in Canada. Provincial, territorial and municipal governments, Indigenous peoples, private sector organisations, federal Crown corporations, Canadian port authorities, and National Airport System authorities are all eligible for funding. What is the National Trade Corridors Fund doing for air cargo? As an example, consider the federal government’s contributions to improvements at the Charlottetown Airport. The Charlottetown Airport Authority is in the final planning stages of a three-year airfield infrastructure revitalisation. In May, my colleague, the Honourable Lawrence MacAulay, Minister of Agriculture and Agri-Food and Mem-

ber of Parliament for Cardigan, announced an investment of $8.1 million in the Charlottetown Airport’s runway and associated taxiways rehabilitation. The Government’s investment will cover 45 per cent of the project’s estimated cost of $18 million. Among other advantages, this revitalisation project will make it easier to move freight in and out of the airport. Air transport is a vital service all over the country, but particularly important in the North. In many northern communities, air transport is the only practical year-round way to move people and goods. Air transport is a crucial link to essential services and work opportunities that are often not available within the community. With that in mind, we recently announced an investment of more than $35 million for

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two projects to improve the flow of supplies to northern communities and support economic opportunities. One project is at the Iqaluit Airport, where First Air is building an expanded cargo warehouse. This new facility will increase capacity by 75 per cent for climate-controlled dry goods and refrigerated products, and reduce spoilage and damage due to weather delays. The new warehouse will be state-of-the-art, with specialised aircraft freight containers and the latest radio frequency identification technology. High efficiency building systems will also reduce the carbon footprint of the operation. This additional warehouse capacity at the Iqaluit Airport will strengthen this vital north/ south transportation corridor and help maintain an efficient and stable supply chain to Canada’s North. The second project involves replacing outdated and undersized airport terminal buildings in the communities of Kugluktuk, Naujaat, Kimmirut, Whale Cove and Chesterfield Inlet. These new buildings will also be more energy-efficient. These investments will help foster economic and social development for northern Canadians and long-term prosperity for the region. Infrastructure projects like these create longterm quality jobs for the middle class, but they also improve the movement of goods to markets. I am confident that our investments in trade and transportation infrastructure will stimulate economic growth and help businesses prosper. And that includes the business of air cargo.

tiaca acf review

Toronto signing brings the number of global air cargo events staged by Messe München to six

ACF takes next step

ne of the most important developments in the history of The International Air Cargo Association ‘s Air Cargo Forum (ACF) took place on the first day of ACF 2018 when a Memorandum of Understanding (MoU) was inked between TIACA and events company Messe München (MM). This was the first step in the two organisations working closely together on TIACA’s Air Cargo Forum and Exhibition. According to MM deputy managing director Gerhard Gerritzen, under the agreement, Messe München will undertake the organisation of the Air Cargo Forum, while TIACA remains in control of the content of the conference. He says: “When TIACA approached us and we discussed a future strategic partnership, the fact that the ACF should take place in Miami in the future was a very important argument for us. We are convinced that exhibitors and visitors like a high degree of consistency at trade fairs. “It is also much easier for the organisers of an event if it takes place at a fixed location. Advantages for visitors and exhibitors can be achieved very quickly in such a case. Because TIACA is also becoming a partner of the Air Cargo trade fairs in Munich and Shanghai, the members can enjoy high visibility and clarity regarding schedules. “The decision in favour of Miami was already taken before the joint talks. But if we were to have named a location where ACF should take place permanently, we would have chosen Miami as well. Florida is not only the perfect addition to air cargo exhibition locations in Europe, China, India and Africa, but Miami also provides everything our customers need as a location. “It has a large community near the airport, a strong logistics background, important industries, important connections to surrounding area and, above all, high multimodality. In addition, Miami connects the markets between North and South America like no other location. At the same time, it is an important gateway to Europe, the Middle East and Asia.”

share a common idea of what fairs should look like for the air cargo industry. The fact that we will keep each show´s own identity is also demonstrated by the fact that Priyo Patra will remain closely involved in the fairs in South Africa and India for at least six years.” The signing of the MoU now means MM has a strategic presence around the world in hosting major airfreight events, says Gerritzen. He says: “Together with our partners, we will be able to provide a total of six events in the future. The annual schedule is as follows: In February, there will be trade fairs in Johannesburg and Mumbai in alternating years, followed by Air Cargo Europe in Munich and Air Cargo China in Shanghai in May/June again in alternative years, and then in fall ACF in Miami in even-numbered years. “In addition, there is already successful air cargo participation at our logitrans trade fair in Istanbul.

Pictured left to right: Robert Schoenberger, (Messe Muenchen), Steven Polmans (TIACA), Sebastiaan Scholte (TIACA) and Gerhard Gerritzen (Messe Muenchen) signing the deal on Tuesday 16 October.

Strategic partner

In an age of social media, Gerritzen is convinced there is still room for physical meetings in business. He says: “Logistics in general, but the air cargo industry in particular, is characterised in daily business by special requirements and customer-specific solutions. These must be shown, explained and discussed. A lot can be resolved by phone and video calls, but personal contact is indispensable. “To convince customers, you have to meet them on site. For this purpose, trade fairs are and will remain an important element of sales activities in this “people’s business. Our main task is to attract new groups of visitors, especially shippers from the industrial sector to the ACF. Good results have already been achieved in Toronto in this respect. We are going to build on that.” TIACA will also be a strategic partner at Messe München’s “transport logistic” events in Munich, Germany, Shanghai, China, and Istanbul, Turkey. The next ACF will take place in Miami, Florida, USA, where TIACA is headquartered. The idea is to organise the event in a fixed location every two years and with the support and knowledge of Messe München, to transform it into a real logistical intermodal event. TIACA will retain editorial control of all content for the conference programs of the ACF and will continue to organise the Executive Summits at different corners in the world to reflect the organisation’s global status. Gerritzen says: “In our discussions with TIACA, it was clear to both sides that ACF must maintain its own look. ACF is supported by its members like no other event. Consequently, the members have to identify with the event, and it must remain recognizably TIACA. Therefore, we will continue employing successful components. We see our task as contributing our expertise as an international trade fair organiser. “The fact that we were able to announce the acquisition of Air Cargo Africa and Air Cargo India as well as the future strategic partnership with TIACA at the same time during the ACF in Toronto is actually rather coincidental. But we are sure that these events all fit well together. “Together with the people in charge of TIACA as well as with the seller of the events in South Africa and India, Priyo Patra, we

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tiaca acf review

Canada is open for business

he 2018 TIACA Air Cargo Forum opened with a ribbon cutting ceremony at the Air Canada Cargo stand just after 11am on Tuesday 16 October. Delegates and exhibitors from around the world flocked to the important air cargo event at the Toronto Metro Convention Centre to hear from industry experts and network with fellow professionals. The ribbon cutting followed opening plenary sessions discussing the importance of air cargo to the Canadian and global economy, as well as the digital transformation of the industry. TIACA secretary general, Vladimir Zubkov started things off by describing Canada as the “aviation capital”, as it is home to a number of organisations including IATA, ICAO and ACI. He said: “We are looking forward to a suc-

cessful event. All of you have come here with interest, ideas, and a desire to progress. We are grateful for the support of Toronto airport and Air Canada.” MPP for Flamborough-Glanbrook and parliamentary assistant to the minister of economic development, Donna Skelly welcomed delegates on behalf of Ontario, admitting that until recently she had not realised how important air cargo was for the economy. She spoke of her new appreciation of the industry, saying nearby Hamilton Airport was the largest overnight express airport in Canada. She had an important message for delegates: “Ontario is open for business. The government wants you to know you are welcome with open arms. We are serious about cutting red tape and

creating the right conditions to grow and thrive. When I talk to businesses the one word I keep hearing is hope, there is hope in Ontario.” Transport Canada acting assistant deputy manager safety and security, Aaron McCrorie explained that air cargo opens up new markets for Canadian businesses. Saying that Canada was built on trading,

he explained: “Originally it involved shipping goods like beaver hats to Europe, which were a luxury, now it is lobsters to Asia continuing that tradition.” They were followed by a panel discussing digital transformation, who discussed the development of blockchain and other issues surrounding digitisation.

It’s never too late to embrace technology

Despite the challenges of embracing new technology, it is never too late for even large companies to undergo the digital transformation, panellists on the plenary session “Digital Transformation- Brave New World or New Normal?” agreed. The session, which followed the opening plenary, heard from industry professionals giving their views on digital issues including the use of blockchain. The panel consisted of CHAMP Cargosystems chief executive officer, Arnaud Lambert; Unisys vice president and global head, Dheeraj Kohli; OMX founder, Nicole Verkindt; Ebay Canada head of marketplace business development merchandising and strategic partnerships, Sumit Srivastava; and SHE Blockchainers Asia founder, Yuree Hong. Lambert commented: “It is never too late to start the digital transformation. You need to hire young talent and focus on that, that is probably the best investment.” Verkindt told delegates she was recently at a conference focusing on AI, saying: “Companies can see what new technology should be put into their company, it is an interesting perspective. They need to look at areas of value,

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delivering to customers where they can get a leg up implementing technology. It always goes back to the core advantage.” AI and predicting behaviour based on past data is an important method of working out what may happen in the future, with Kohli saying Unisys has done case studies and is now looking at optimising belly space. He explained: “Right now it is about the shipment and looking at what was shipped, mapping it with the loading weight of the aircraft and what it can carry.” Lambert added that speed is not the only important factor but the growth of e-commerce means data is vital. He said: “E-commerce requires a different speed, which will accelerate even more in the coming years. Technology will come into play with AI, security is key when asking about transparency and data availability. We need to ensure we have right data and nobody is using data for the wrong reasons. The weakest link is the human, most security breaches are still by humans.” The advantages and disadvantages of being an early adopter of technology was up for discussion with Srivastava saying: “The advantage of being an early adopter is getting the tools in the beta stage. The cost to access the tools is cheaper.” Panellists urged the industry to also look at all forms of digital innovation that could transform the industry with Kohli asking: “why just invest in blockchain? There are other disruptive technologies, rather than blindly following blockchain think of innovation, pick up proof of concepts.”

tiaca acf review

What lies ahead? I’ll get out the crystall ball

hough air cargo is not likely to grow at the same pace as it did in 2017, this year is likely to be solid but global issues including trade wars are a cause for concern. To analyse what has happened and predict what is likely to happen in the immediate future, Jan de Rijk Logistics CEO and TIACA chairman, Sebastiaan Scholte was joined by Boeing Commercial Airplanes managing director, market analysis and sales support, Darren Hulst; Seabury Consulting managing director, Marco Bloemen; WorldACD Market Data director market analysis and commercial development, Ken de Witt Hamer; and Airbus head of freighter marketing, Oliver von Tronchin on 16 October at 1pm in room 201. After a few words from Scholte highlighting last year’s capacity shortages and hoping that trade wars and talk of an economic downturn do not become a self-fulfilling prophecy, Hulst was welcomed to the stage to explain how the air cargo market has developed.

Left to right: Tronchin, Bloemen, Hamer, Hulst and Scholte

Growth has slowed

Hulst explained how air cargo demand grew almost 10 per cent last year and though growth has slowed, the two year average rate is about six per cent. He told delegates that air cargo accounts for less than 0.5 per cent of trade by weight but 35 per cent by value, and that the Chinese e-commerce market will be larger than the US and much of Europe by 2020. Recent years have been more difficult; he cited figures showing that air cargo grew on average five per cent a year between 1996 and 2006 before slowing to two per cent from 2006 to 2016. Growth is expected to average 4.2 per cent between 2018 and 2022. Hulst says Boeing is in a strong position in the freighter market, saying: “With almost 130 new freighter orders including conversions in the last 18 months, we’re cautiously optimistic about the market going forward.”

Looking at trade wars

Bloemen was next on stage, and he told the audience that air cargo managers are talking about the impact of trade wars, rebalancing supply and demand, fuel prices and labour developments. “Future freighter orders will mostly come from integrators, the question is what will the capacity do for the airline market. Fuel prices have doubled in the last two years, labour costs and crew shortages are a challenge for the industry,” he said. The US-China trade war has not caused any significant issues for air cargo yet, with the first wave affecting 150,000 tonnes of trade including cherries and lobsters and the second wave valued at $200 billion covering goods including mobile phone parts. The third wave increasing tariffs from 10 per cent to 25 per cent could be an issue. Having heard Boeing’s predictions, Airbus head of freighter marketing, Oliver von Tronchin later came to the stage to talk about the growth of express services and its predictions. Airbus expects growth in freight tonne kilometres to average 3.7 per cent a year for 20 years. A330 -200P2Fs and -300P2Fs have entered service with A320 and A321 P2Fs due soon.

New products

Tronchin comments: “This gives us four new P2F products. Today the 767 is the main plane but declining feedstock mean the A330P2F will succeed the 767.” A capacity shortage is a major driver of the P2F programme, though Tronchin admits Airbus could convert more aircraft but they are not coming out of the passenger fleet. Hulst says despite geopolitical risks, he believes Boeing has the right products for the future. Demand remains strong enough to convert 737s and 767s, while for larger aircraft the 777 will continue to prove popular. He told the audience: “The 747 remains available and there is strong demand. Combined with the 777 they work together really well.” Tronchin says a major question for the future is who can make freighters work in the future. He says: “Freighters are a large capital investments, you need to make a strong business case. The point is that if you just stay as a transport provider then you do not add much value. Other players such as Amazon are busy adding value.”

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ACW 29 october 2018

TIACA ACF REVIEW

Drones will be flying into a fleet near you

rones are not a fantasy, they are a reality and will be providing vital services in remote areas in the near future, delegates in the “Unmanned Freight Aircraft” session on 17 October were told. Astral Aviation founder and CEO, Sanjeev Gadhia was joined by Natilus CEO and co-founder, Aleksey Matyushev; Dronamics co-founder, Svilen Rangelov; and Sabrewing Aircraft Company CEO, Ed De Reyes to talk about their products and their potential to change the industry. Before giving an update on Astral’s drone project, Gadhia explained that drones have been used in Rwanda to deliver blood samples and in China to bridge gaps in remote areas. IATA says they will be particularly useful for

last mile deliveries, humanitarian cargo and e-commerce goods. Gadhia said Astral Aerial Solutions is in the process of setting up drone operations in East Africa and it has a lot of potential. He told delegates: “We believe it will have an impact in humanitarian operations, commercial and postal services. It has the flexibility of flight schedules, it can land on unpaved runways, fewer crew requirements, minimal stop-overs and can provide more direct flights.” Astral has a number of products including the UAV-AID, a smaller product with a 300 kilometre range, which Gadhia says is ideal for smaller deliveries for the medical and e-commerce industries. There is the larger Falcon F-250 with a range of 1,500 kilometres and a payload of 250 kilograms, which requires a small airfield

Left to right: Gadhia, Matyushev, Rangelov and De Reyes

to land. Gadhia is most excited about the FLYOX Cargo Drone, with a payload of four tonnes, a range of 1,200 kilometres and the ability to land on water and unpaved airstrips. It will be integrated into Astral’s fleet very soon. Gadhia told the audience: “The biggest positive we have to offer is the value proposition. We believe the FLYOX has a better payload and lower operating cost. The FLYOX is real and being tested in Norway.”

Halving operating costs

Matyushev was next on stage to explain what his company is doing. Natilus was founded in 2016 in a venture funded with help from Tesla. It is producing last scale vehicles with the intention of reducing operating costs by 40 – 50 per cent, with the first product being designed for e-commerce shipments. He explained: “It is designed with e-commerce in mind, the blended wing body has an air foil body to reduce drag.” The first product is a 3.4 tonne freighter with 28 cubic metres of volume. Matyushev says it reduces operating costs by 40 per cent compared to a Cessna or similar aircraft. It is in the final test stage and should start operations within two years.

Opportunities to grow

Rangelov, who co-founded Dronamics in 2014 with his brother, Konstantin explained that 99 out of 100 shippers do not choose aircraft so there are tremendous opportunities to grow. Dronamics’ product, the Black Swan needed to have low operating costs, be fuel efficient and have cargo volumes to fit e-commerce shipments. Rangelov said: “We are going to serve regions where geography prevents efficient road transport. A lot of shopping happen online, shipping

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is a big part of that.” Something that needs to be considered is how drones fit into the ecosystem as they will not be landing at regular airports so work needs to be done to ensure flight safety.

Standardised port

“We are working on a standardised drone port layout. It will depend on the country but they will create jobs and opportunities. Managing hundreds of thousands of drones will mean changes to the air traffic model.” De Reyes says Sabrewing are building a cargo drone that does not require an airport. The launch customer is in Alaska, a remote area where few communities are served by road. Alaska is not unique, with De Reyes saying there are many areas in places like Africa and India with no landing strips. Sabrewing was founded in 2016 and has three separate models with the Rhaegal offering a payload of 800lb, the Draco carrying 2,500lb and the Wyvern offering up to 4,400lb. De Reyes says: “They can take off and land vertically, have a range of 800 nautical miles flying high and fast, and land and take off in all weathers. They can do disaster relief and search and rescue. We will start flight testing in June 2019.”

They will be flying soon

How soon these products will be flying is open to debate as there are regulatory hurdles to overcome. Gadhia says Astral’s pilot project will be operating in Africa mid-2019 while De Reyes says: “We believe we will be carrying cargo by the end of 2020, we are in discussions to do that. There’s no reason why we couldn’t look at full certification by 2023.”

tiaca acf review

TIACA’s ACF move suits ECS group

CEO: Move to permanently stage the biennial event in Miami “surprised” the French GSA

aris-based GSA operation ECS Group is looking forward to the new location for TIACA’s Air Cargo Forums from 2020, says Adrien Thominet, CEO. The move to permanently locate the biennial forum and exhibition in Miami in the Sunshine state suits the organisation’s plans to extend coverage to Latin and South America. While pleased with the decision to root the event in one location, Thominet reveals he was “surprised” when he learnt of the decision. He says: “I think Miami will be very good for the ACF. It will be very good for ECS Group as we look to expand our South American and Latin American coverage. It is a great location for these markets. “It was a surprise for us when we learnt of the decision. It will be a challenge for them to get it right though I am sure Messe Muenchen will work to make it a success.” His concern is that in rooting it in one city in one country, the event will become too parochial in nature. He is worried that, like other air cargo events in the US, the ACF could become too rooted in US culture to be truly international.

Thominet @ Toronto: We are 30 per cent up on 2017

Thominet took time to visit Toronto certain in the knowledge that 2018 so far has been a “very good year” for ECS Group. While the airline sector may point to 2017 as a high-water market in industry activity, for ECS Group 2018 has been significantly better. He says: “We have had a very good year so far. We are 30 per cent up on 2017.” The group continues to grow by acquisition, notably in the Brazilian market when it acquired a precious jewel to its global crown with the acquisition of Brazil’s leading GSA, BCS Air, helping firm up its footprint in South America. In a key move in the Americas, ECS Group subsidiary Globe Air Cargo started to represent Finnair Cargo in the US from 1 May. The group is also hiring, always a good sign of a corporation’s health. This expansion includes a specialist digital executive who will head a department of between 10 and 15 digital marketers and communications to help boost the group’s digital media activity.

More like Munich

ECS Group has attended every ACF since its inception in the mid-1990s, notes Thominet. This allows Thominet to consider the ROI in attending each event. Toronto was “frustrating” for him by what was not showing at the event. “There are no European, Asian or Middle Eastern airlines at this event,” he said. “If they are not careful, it will simply become full of IT, airports and GSAs at the ACF.” He is convinced that the ACF must become more like the Munich air cargo event where all major players are present or represented.

Man of the moment

Leach was destined for aviation – he was born at London Stansted Airport, where his father was a pilot

THE ACF ended with the induction of Chris Leach, founder and chairman of UK-based Air Charter Service (ACS) into TIACA’s Hall of Fame, which celebrates leading air cargo professionals who have made a huge difference to the industry. Leach, who has worked in the cargo aviation industry for over 40 years, was presented with his Hall of Fame material from old friend Larry Coyne. “I can think of no one more deserving of this accolade than Chris, who started Air Charter Service from humble beginnings almost 30 years ago, only to watch it develop into the impressive multinational company it is today,” says TIACA secretary general Vladimir Zubkov. “He joins a long list of air cargo dignitaries who have played a key role in the progress of the airfreight business globally.” During the presentation at Toronto’s Metro Convention Centre, Leach was given a scarf and hat set representing his favourite football team – London’s Queen’s Park Rangers (QPR). “Chris is truly a man of character, from his strong work ethic and passion for aviation, to his compassion for others, and he is a truly well-deserved winner,” says TIACA chairman Sebastiaan Scholte. Leach says: “I started ACS in 1990 in my basement to simply pay the bills and to support my young family, but here we are 28 years later. I’d like to thank the entire ACS family, which is now almost 500 people, for their hard work and belief in what we do.” Past winners of the Hall of Fame have included James ‘Jim’ Jackson, a driving force behind Unit Load Devices (ULD), Ray Crane, Des Vertannes and Bill Boesch, recognied for “unwavering commitment to the development of the air cargo industry.”

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ACW 29 october 2018

dubai

Emirates SkyCargo promotes trade with Vietnam Dubai is working hard to maintain its position as a vital transit hub.

mirates SkyCargo has signed a memorandum of understanding (MoU) with the Investment and Tourism Promotion Centre of Ho Chi Minh City to promote trade with Vietnam. The agreement was signed in Dubai by Emirates divisional senior vice president for cargo, Nabil Sultan and Investment and Trade Promotion Centre Ho Chi Minh City director, Pham Thiet Hoa at Vietnam’s conference on Trade, Investment and Tourism Promotion. Emirates SkyCargo has played a key role in supporting trade between Vietnam and the world since starting operations in Hanoi in 2008.

Passenger and freighter flights have increased with services to Ho Chi Minh City as well as Hanoi. Through its partners, Emirates SkyCargo has also supported businesses from other Vietnamese cities including Da Nang. During the 2017-18 financial year, Emirates SkyCargo transported 50,000 tonnes of Vietnamese exports and imports, up 66 per cent on 2015-16. Emirates SkyCargo has transported 47,000 tonnes of exports from Ho Chi Minh City over the last five years including fruit and vegetables, garments, sports apparel and fresh fish. The airline offers daily passenger flights as well as two weekly freighter services from Ho Chi Minh City. The airline has transported about 65,000

tonnes of exports out of Hanoi in the last five years, mainly consisting of electronic items such as mobile phones. In the past five years, Emirates SkyCargo has

transported 160,000 tonnes of exports from Vietnam and offers over 1,400 tonnes of capacity a week on its five weekly freighter services and 14 passenger flights.

Enhanced air waybills for flydubai

flydubai and Swiss Aviation Software have integrated the flydubai Engineering Maintenance System (AMOS) with FedEx Web Services to enhance air waybill generation and paperless documentation. The integration of the FedEx air waybill automation in the AMOS system allows flydubai to manage the entire process from their desktop, reducing processing time by up to a minute per shipment and saving 340 employee hours per month. FedEx Web Services technology will help avoid duplicate data entry, ensuring that air waybills are created error free while providing real-time tracking and transit times. flydubai senior vice president of engineering and maintenance, Mick Hills says: “Integrating our Engineering Maintenance System with FedEx Web Services will have a lasting effect on our automation process, by reducing shipment

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processing times and increasing our operational efficiency. “We would like to thank FedEx Express and Swiss Aviation for their support as we look forward to the added benefits that this innovative technology will bring to our operations.” FedEx Express regional president – Middle East, Indian Subcontinent and Africa, Jack Muhs says: “At FedEx, innovation has been in our DNA since our first day of operations in 1973, and our technology is designed based on what our customers need to make their shipping processes and business successful. “FedEx Web Services are designed to seamlessly integrate into third party software providers, which helps organisations such as flydubai increase their operational efficiency, streamline their workload and improve business processes with minimal time and investment.”

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15 18/10/2018 12:47

he pretends to know what he’s talking about

Movember: It’s all about the top lip

ike many great ideas in history, Movember owes its roots to an idea dreamt up in a pub over a few cold beers. In 1999, Australian broadcaster Seven Network aired the story of a group of young men in Adelaide, South Australia who coined the term “Movember” and the idea of growing moustaches for charity throughout the month of November. In the UK, prostate cancer is the most common cancer in men. It’s already killing hundreds of thousands of men each year, and those who survive face serious side effects. In fact, it kills one man every 45 minutes.

Airway Bill is, thankfully clear of any trouble with his prostrate, but millions of men are not. Everyday, men are diagnosed with prostate cancer. In order to help the work of the Movember Foundation to fund and inspire research into this condition, Airway Bill has formed the Airfreight ‘Airies and invites males in the airfreight industry to join his fund-raising efforts next month. He says: “My good friend James, the ACW editor, has said he will take part this year for the first time and asked me for support. The

Movember Foundation is the only global charity focused solely on men’s health, so this Movember we’re getting on board.

among the many thousands of male Air Cargo Week readers join in and grow their own ‘taches or just donate to the Airfreight ‘Airies - or better still, do both. He does not mind how or when a donation is made or whether it is a one-off or a regular donation to the Foundation.

The editor’s top lip on November 1, 2018. Each week, a photgraphic update will be provided.

“There will be men reading Air Cargo Week today who, sadly, will fall victim to prostrate or testicular cancer sometime in the future. Even if they do not themselves, chances are they have a brother, son, friend, neighbour or work colleague who may be afflicted.” The Movember website has many suggestions for how to raise money for the worthwhile cause. Graham says: “I invite all men in the airfreight industry to support me. You have only your shavng cream to lose.”

“Some of the team at Air Cargo Week are putting their ‘taches on the line for a good cause. Those in the airfreight industry - men and women - are welcome to back us - as long as they don’t mind being tickled by the hair.” Graham says: “I asked my good freind Bill how I could help this cause and he came up with this idea. I must warn our many freaders that in the hair department I am no caveman. Those who know me now have never seen me with a full head of hair. “Even when I had flowing locks, the facial hair department was almost non-existant. Try as I might, a five o’clock stubble takes about a week to grow.” Graham asks that kind-hearted supporters

Donations can be made to: https://moteam.co/airfreight-airies

Michael’s coats of many colours

Canada - USA

USA - Mexico

Canada - Mexico

ONE OF the stand-out booth exhibitors at ACF Toronto was Mexpress Transportation’s Michael Gamel and his range of less-than subtle jacketwear. The enterprising businessman from Santa Clarita, California had the clever idea of purchasing three colourful sports jackets and asking his tailor to cut them in half and re-sew them to produce some standout satorial sass. The clever marketing move combined the flags of the three North American countries - Canada, United States and Mexico. The jackets are modelled by ACW editor James Graham. Mexpress provides transit times of 48 and 60 hours from Los Angeles Airport using Nogales Sonora as the point of entrance into Mexico.

WHAT GOES ON IN TORONTO ... AZura staff enjoying some downtime after producing the three ACF dailies.

Vencatase tor Jason er c e ir d l ia Commerchts in the CN Tow new heig

n reachin

Design and production manager Alex Brown taking on Niagara Falls

Deputy editor James Muir making a friend at the Royal Ontario Museum Operations director Kim Smith getting drenched

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