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The weekly newspaper for air cargo professionals Volume: 21

Issue: 17

30 April 2018

West Atlantic

gets keys to first 737-800BCF


oeing has delivered the first 737-800 Boeing Converted Freighter (BCF) to GE Capital Aviation Services (GECAS), to be operated by West Atlantic. The aircraft was handed over to the customer at a ceremony at East Midlands Airport on 19 April, and West Atlantic will receive a further four within by middle 2019. The 737-800BCF can carry up to 23.9 tonnes with a range of 2,000 nautical miles, and will primarily be used to carry express cargo on domestic and short haul routes. Its 12 pallet positions

provide 141.4 cubic metres of cargo space on the main deck, complemented by two lower lobe compartments, providing an additional 43.7 cubic metres of space. West Atlantic chief executive, Fredrik Groth says: “We’re excited to be the first operator of the 737-800BCF. The additional capacity and Next-Generation efficiency offered by this new aircraft will deliver real benefit to our customers and we’re delighted to be at the forefront of deliveries of this new technology. Boeing Global Services vice president for commercial services,

Globe Air Cargo lands stateside deal with Finnair Cargo

In a key move in the Americas, ECS Group subsidiary Globe Air Cargo will represent Finnair Cargo in the US from 1 May. The airline, which serves major gateways at Chicago, Miami, New York and San Francisco directly from Helsinki, will utilise an Airbus 350 on the routes. The A350 has a maximum cargo capacity approximately 95m³ / 23 tonnes. The airline’s services to the US handle a share of the Nordic region’s enormous traffic in salmon that is exported to the US.

hactl cleans up environmental awards


Finnair Cargo head of global sales, Fredrik Wildtgrube, says: “We’re happy to be able to grow our co-operation with ECS Group. They already support us in South-East Asia and now we are able to enter a co-operation in the US market. ECS Group’s dedication to customer service, network setup and strong attitude to smooth flow of goods are ingredients that we need now and in the future to promote the continued growth of Finnair.” ECS Group global key account director for Finnair Cargo, Jonas H Drewsen, says: “It is with great pride that Globe Air Cargo has been awarded the Finnair cargo GSA contract in the Americas. “Finnair is on a fantastic journey; they have a new ultra-modern COOL Terminal in Helsinki, they are renewing their fleet, and in addition they are also expanding into new and interesting destinations, mainly in Asia. ECS Group, through Globe Air Cargo, is thrilled to be in partnership with Finnair Cargo.”

industry failed to meet expectations


Mike Fleming adds: “The 737-800BCF brings customers the next generation of freighters. For the first time, operators get onestop shop support throughout the lifecycle of a standard-body freighter – originally manufactured by Boeing, converted by Boeing, and supported by Boeing.” Boeing has received 45 orders and commitments from seven customers for 737-800BCFs including YTO Airlines; China Postal Airlines; GECAS; Air Algerie; LAS Cargo; Cargo Air and an unannounced customer.

Antonov flies AN-225 to Berlin Antonov has landed the AN-225 Mriya in Berlin to provide additional support to the Strategic Airlift International Solution (SALIS) programme. The AN-225, with a 250 tonne payload, is taking part in the Berlin Innovation and Leadership in Aerospace Air Show. Antonov is providing the SALIS programme with AN-124-100s for strategic air transportation in the interest of NATO and European Union nations. It has seven AN-124-100s, two of which have an increased payload capacity of 150 tonnes. The fleet is undergoing modernisation. The AN-225 was at ILA Berlin Air Show 2018 until Sunday 29 April.

changes create new business areas


cargolux has a record year


Forwarders reach for the sky in first quarter


rofit margins at Panalpina’s airfreight division have increased with gross profit per ton increasing 19 per cent in the first quarter of 2018. Airfreight volumes increased three per cent while gross profit per ton was up 19 per cent from 620 Swiss francs (CHF) in 2017 to CHF 739 ($757) this year, with overall gross profit increased to CHF 177.8 million. Earnings before interest and tax (EBIT) for airfreight increased from CHF 17.1 million in 2017 to CHF 26.9 million, with EBIT-to-gross-profit margin increasing from 11.8 per cent to 15.1 per cent in 2018. Looking ahead, Panalpina chief executive officer, Stefan Karlen says: “Global air freight demand continues to be healthy and the carriers have begun to increase rates substantially. We will have to be very disciplined in passing these rate increases on as we head for a summer season that could be busier than usual again.” Profits at Kuehne + Nagel have grown at double digit rates with airfreight volumes increasing by more than 20 per cent helped by strategic acquisitions. Earnings for the period increased by 11.5 per cent from CHF 165 million in the first quarter of 2017 to CHF 184 million, with net turnover rising by 13.1 per cent to CHF 4.8 billion. Airfreight had another strong year with tonnage increas-

ing more than 20 per cent to 422,000 tonnes, with particularly strong growth for exports from North America. Airfreight turnover increased from CHF 1 billion in the first quarter of 2017 to CHF 1.3 billion, with segment profits measured in earnings before interest and tax rising 12.5 per cent to CHF 81 million. Kuehne + Nagel International chief executive officer, Dr Detlef Trefzger says: “We have made a successful start into the business year and achieved clear increases in volume across all business units.”

FedEx connects Memphis with Guangzhou for the first time

FedEx Express has connected its FedEx World Hub in Memphis, Tennessee with its APAC Hub in Guangzhou, China for the first time. The route is being served with five flights a week from Tuesday to Saturday using an MD-11 Freighter, which will be upgraded to a Boeing 777 Freighter in May. The flights in April departing from Guangzhou stop in Osaka, Japan and Anchorage, Alaska and in May they will stop in Osaka before flying directly to Memphis. From Tuesday to Friday, the flight returning from Memphis stops in Indianapolis, Indiana and Anchorage before flying directly to Guangzhou, while Saturday flights stop in Honolulu, Hawaii and Anchorage. FedEx Express Asia Pacific president, Karen Reddington says: “As our business continues to develop across the Asia Pacific region, we constantly adjust our network and routings to better meet dynamic market needs. “Adding volume and a faster, more direct connection to our Memphis World Hub will give Asia Pacific businesses a stronger competitive advantage in connecting to customers in North America and beyond.”


to show China Southern Airlines’ Y2K readiness, top executives announced they would fly around the world on the big day.

And finally ... happy new millenium Volume 2 Issue 48 6 December 1999 Top executives of China Southern Airlines, will welcome the new millenium thousands of metres in the air. In addition, vice president Li Feng Hua will be in the left hand seat to fly a B757 from Guangzhou to Shanghai. They will be there to demonstrate the airline’s Y2K readiness. President Yan Zhi Qing and senior vice president Han Ma Zhang will board flights on 31 December. Yan will fly from Guangzhou to Los Angeles on a B777 nonstop transpacific service, while Han will be on an A320 from Guangzhou to Singapore. Airline vice president Hui Yun Qi will celebrate on a B777 from Guangzhou to Beijing. China Southern’s president Yan agreed that with Li piloting one of the airline’s aircraft: “We truly will greet the Y2K challenge with our own hands.”

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Fraport and Swissport sign warehouse deal


raport and Swissport have signed a long-term lease to develop a custom-built air cargo warehouse at Frankfurt Airport’s CargoCity South. The facility will have a surface of 16,900 square metres, with an additional 2,200 square metres to be used as office and social space. Construction is scheduled to begin in 2019 with completion and handover to Swissport Cargo Services Deutschland planned for the beginning of the third quarter of 2020. Fraport senior vice president of real estate, Christian Balletshofer says: “Thanks to the excellent location in CargoCity South and a flexible design, this new warehouse will allow Swissport to meet and continually optimise air freight handling requirements. Therefore, the innovative facility will provide Swissport with longterm growth opportunities at Frankfurt Airport.” Swissport senior vice president for Germany, Austria & Switzerland, Willy Ruf adds: “Swissport is committing a double-digit million euro amount towards the new facility at Frankfurt. Infrastructure plays a key role in optimising our service delivery and reaching the ambitious efficiency and reliability goals for our clients around the world.”

Fraport handles IATA CEIV

WorldNews Saudia Cargo has appointed ATC Aviation Services as its general sales and service agent for South Africa from 1 May 2018. The Saudi Arabian airline provides airfreight services to more than 230 destinations and its freighter fleet consists of Boeing 747-8s, 747-400ERFs, 747-400BCFs and 777Fs, in addition to belly capacity in passenger aircraft.The carrier already has a successful partnership with ATC in Brazil.

Artist impression Frankfurt Airport’s CargoCity South is a 98-hectare site with a community of 200 companies who can take advantage of more than 300 flight destinations worldwide via Frankfurt Airport. There are also road connections via the Frankfurter Kreuz motorway junction offering extensive road links as well as rail connections.

DoKaSch Temperature Solutions is expanding its USA operations with the establishment of San Francisco-based DoKaSch Americas with Douglas Wettergren joining as chief executive officer. Wettergren’s duties will include sales and business development for DoKaSch’s flying aircon warehouse Opticooler RAP and RKN to pharmaceutical forwarding companies. Opticoolers are climate controlled air cargo containers and are based at designated locations in the US to provide them quickly to clients across North America.

Frankfurt Airport’s operator, Fraport has received CEIV Pharma certification from the International Air Transport Association (IATA) for ramp handling of pharmaceuticals. The Center of Excellence for Independent Validators in Pharmaceutical Logistics (CEIV Pharma) certificate is awarded for reliable transport of time-critical and temperature-sensitive products, helping companies to comply with internationally recognised rules and standards to handle pharmaceuticals. Frankfurt Airport handled more than 100,000 tonnes of vaccines, drugs, medicines and other pharmaceutical products in 2017, which require a high standard of handling, requiring quality management, training of staff and infrastructure to handle and store the products. The certificate was awarded to Fraport at the IATA Ground Handling Conference in Doha. When receiving the certificate, Fraport’s senior executive vice president of ground services, Martin Bien (pictured second right) says: “With the CEIV Pharma certification from IATA, Frankfurt Airport is one of the largest pharmaceutical hubs in the world to offer a fully certified ground handling process – now with ramp handling also included. “We see pharmaceutical transportation as a growth market for the future. Receiving IATA’s CEIV certification underscores that Fraport has the requisite infrastructure and the necessary expertise to accommodate this growth.” Fraport’s ramp handling division has been operating a transporter vehicle for temperature controlled shipments for over 20 years and it is the first piece of ground equipment to be covered by the CEIV certification. The vehicle allows transportation of main and lower deck units in a range from -30 to +30 degrees Celsius and is equipped with an electronic temperature monitoring system and tracking options.

Quote of the week “We failed as an industry - we were caught with our pants down” Chapman Freeborn CEO, Russi Batliwala describes the mayhem of Q4 03 30 Apr 2018.indd 1

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Freight index cleared for take-off BARIG cooperates with Zeitfracht


reight Investor Services (FIS), the global leader in freight and commodity derivatives, is bringing its expertise in financial risk management to the airfreight market with the launch of Air Cargo FFAs. The London-based brokerage has partnered with The Air Cargo Index (TAC Index) to offer airlines, forwarders and end users the means to flexibly price air cargo contracts and to hedge their exposure using cleared financial futures contracts. The air cargo freight market is undergoing a transformation; growing rapidly, with volumes expected to more than double in the next 20 years, it also faces threats from new entrants challenging established business models and promising new levels of transparency using tools that threaten long-standing relationships. “At FIS we have a track record of developing new commodity and logistics markets and help-

ing our clients manage their transportation and logistics risks and improve their margins,” says FIS head of strategy Michael Gaylard. Buyers and sellers of cargo space will be able to improve price discovery on physical fixed rate contracts, strike index-linked floating block space agreements and use Air Cargo FFAs to lock in prices.

Turkey to export cherries to China

Turkey will start exporting cherries to China later this spring, national carrier Turkish Airlines has confirmed to Air Cargo Week. Turkey’s cherry season is May 10 – July 10 with some regional variations, the Istanbul-headquartered carrier said but declined to discuss further details. The new trade not only illustrates demand in China for perishables but Turkey’s increasing role as an exporter of fresh products and the opportunities it creates for home-base carrier Turkish Airlines. “In 2018, we estimate that our export via air cargo will exceed 10,000 tonnes,” Aegean Fresh Fruit and Vegetable Exporters’ Association chairman Rıza Seyyar told Turkey’s Anadolu news agency. Exporters transported some 3,500 tonnes of products in 2016 and 6,200 tonnes in 2017 via air cargo, he adds. “We also sat down with Turkish Airlines to start exporting these products to the Far East and South East Asian markets via air cargo faster and at a lower cost. After sign-

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ing an agreement in 2017, we created very cost-effective tracks for some of our destinations,” says Seyyar. Looking ahead and further afield, the Association is launching a production and development (P&D) project to firm up Turkey’s competitive position in exporting fresh cherries and grapes as well as looking at other countries. “Trade delegations formed as part of the project in 2017 have already visited Malaysia and Vietnam,” Seyyar told Anadolu. One impediment to exports has been Asian concerns over Mediterranean fruit fly which meant export permits could only be agreed upon with quarantine agreements between the two countries’ agriculture ministries in place, Seyyar notes. “As a result, nine producers and six packaging plants were allowed to export cherries to China after some intense negotiations and mutual visits. We are working hard to get an export permit to Vietnam in the coming days,” says Seyyar.

The Board of Airline Representatives in Germany (BARIG) and Zeitfracht Luftfahrt Holding have intensified their cooperation in the field of air cargo and logistics. Under the agreement, Zeitfracht and its airfreight service provider subsidiary, Leisure Cargo will now contribute to the mutual promotion of major industry topics. The Berlin based-Zeitfracht group is an owner operated, medium-sized logistics provider that covers multiple areas of the logistics chain. Since 2017 it has included airfreight service provider Leisure Cargo, a partner of several BARIG member airlines with its main office in Berlin and establishments in Frankfurt and Dusseldorf. BARIG secretary general, Michael Hoppe (pictured right with Zeitfracht Group managing director, Dr Wolfram Simon) says: “Following WDL Aviation’s joining as new

member, BARIG’s Business Partner portfolio has now been further enhanced by the parent company Zeitfracht Luftfahrt Holding GmbH as well as the affiliated company Leisure Cargo GmbH, two renowned air cargo and logistics specialists. We warmly welcome both players in our association.” Leisure Cargo managing director, Thilo Schaefer says: “With the scheduled expansion of our business and the creation of new offers, we want to contribute to the strengthening of the air cargo market in Germany.”

CMA CGM takes 25% stake in CEVA Worldwide shipping company CMA CGM has reached an agreement to acquire an equity stake of nearly 25 per cent of CEVA Logistics, a global leading player in the logistics sector. CMA CGM has committed to subscribe for mandatory convertible securities of CEVA in an estimated amount between CHF 380 and CHF 450 million. These securities will be convertible into CEVA common shares subject to obtaining all required regulatory approvals. With this transaction, CMA CGM aims to grow its presence in the logistics sector, a business closely related to shipping. CEVA posted revenues of over $7 billion in 2017. CEVA is the number five player in contract logistics, providing end-to-end supply chain solutions, and managing more than nine million sq m of warehouses in more than 750 sites in the world. It is also ranked 10th in the world in freight forwarding, with a strong footprint in Asia. Its long-standing blue-chip customer base includes leading players in the automobile, consumer & retail (including e-commerce), industrial & aerospace, technology and

healthcare sectors. The closing of the transaction remains subject to the completion of CEVA’s IPO as well as to the approval from regulatory authorities. Commenting on the proposed transaction, Rodolphe Saadé, CMA CGM chairman and CEO, Rodolphe Saadé says: “With this proposed investment in CEVA, CMA CGM makes a significant move, in line with its development strategy. “CEVA is a major player in the logistics business, which is closely related to the shipping industry. Together, the two companies will also explore possible cooperations allowing us to propose an ever more differentiated and qualitative offering while integrating services beyond maritime transport.“

Navigation services get harmonised

The harmonising of air navigation services between European and African countries has moved a step closer with the incorporation of Tunisia into the AEFMP memorandum of understanding that covers service providers from Algeria, France, Morocco, Spain and Portugal. The agreement was signed last month at the World Air Traffic Management Congress held in Madrid. The civil aviation authorities in the six coun-

tries as the service providers have renewed their commitment to continue working together to facilitate the optimum use of their air space, maintaining the highest levels of quality and security, in line with the latest requirements and initiatives in place, such as the Single European Sky project. AEFMP is a group of six Western Mediterranean air navigation service providers – ENNA, ENAIRE, DSNA, ONDA, NAV Portugal and OACA 26/04/2018 12:34

BIFA welcomes forwarding apprenticeships


he British International Freight Association (BIFA) has welcomed the news that the Institute for Apprenticeships (IfA) has delivered the final approval of the course assessment plan, which means that the International Freight Forwarding Specialist apprenticeship is now available for delivery. Over the past 18 months, BIFA has been supporting a trailblazer group of employers from the freight and logistics sector to develop a standard for a specific International Freight Forwarding Specialist apprenticeship. Set at Level 3 (A Level) with a minimum duration of 18 months, the new apprenticeship will provide students with core knowledge and skills including; industry awareness, customs procedures and commercial skills. At the beginning of the programme, apprentices will also be given one of three pathways; air freight, ocean freight or road freight, to reflect the focus of freight forwarders’ operations. Whichever pathway apprentices take, specific

knowledge and skills will be acquired in addition to the three mandatory modules. BIFA’s training development manager Carl Hobbis says: “This really is great news and a significant milestone and will definitely help us to attract more young people to the industry. It is a feather in the cap of those in the trailblazer group, which has been resolute in recognising the importance and potential value of a relevant apprenticeship that is specific to the forwarding sector. “With customs legislation getting more complex, and the unknown landscape post-Brexit, it will be even more important to promote careers in our industry in many ways – and there’s no better way than through a relevant apprenticeship, which we now have.” BIFA will now help to promote the availability of the new apprenticeship and encourage employers and potential entrants to consider this apprenticeship as a route into the industry.

Hactl cleans up environmental awards

Hong Kong Air Cargo Terminals Limited (HACTL) has received the Hong Kong International Airport (HKIA) Environmental Management Recognition Scheme Grand Award, for its continuing efforts to reduce waste. HACTL’s winning submission majored on its benchmarking methods, staff training and education, and its waste management performance. In an on-site assessment in August 2017, and two further surveillance visits in November and February, HACTL scored full marks. Throughout 2017, HACTL reused or recycled 95 per cent of plastics waste, 97 per cent of paper, and 68 per cent of wood. HACTL is the first Hong Kong handler to receive the award, which was presented to 05 30 Apr 2018.indd 1

HACTL senior manager – quality assurance, Benny Siu by Wong Kam-sing, secretary for the environment. Says Siu: “There have been many contributing factors in our results, including our annual “Green Week” held in collaboration with Friends of the Earth, and the reduction in paper use made possible by our COSAC-Plus management system. “It becomes increasingly challenging to find new ways to further reduce HACTL’s environmental impact, but we remain determined to improve our performance through new and innovative measures. A target for 2018 is to reduce the quantity of disposable bottles, straws, food containers and cutlery used in our terminal by our visitors, resident customers and 2,400 staff.”

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Industry first for Egyptair conversions One way Egypt Air Cargo is developing is in creating an industry first in its adaption of three of its A330-200s from passenger to cargo, writes Michael Mackey. “We do the conversion for three A330-200 – and it is indeed the first time that this is done at an A300-200,” an official with EFW, the firm tasked with the adaption, told Air Cargo Week. In an engaging example of modesty, Egypt Air’s Cargo department was not available for comment. The A330P2F conversion programme, launched in 2012, is a collaboration between ST Aerospace, Airbus and joint venture firm Elbe Flugzeugwerke (EFW), ST Aerospace, as the programme and technical lead for the engineering development phase, is responsible for applying for the STCs from EASA and the US Federal

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Aviation Administration (FAA). Airbus contributes to the programme with OEM data and certification support, while EFW leads the industrialisation phase and marketing for the freighter conversion programme. The A330P2F programme has two variants – the A330-200P2F and the larger A330-300P2F – with the latter ideal for serving the international express B2B and e-commerce cargo markets, which typically have a higher volume and lower density.

Expansive Emirates looks to more direct shipments


ometimes it’s hard to discern exactly where the focus of a company is: Emirates Sky Cargo is such a company. This is a company that applies itself to both extending its roster of destinations and the frequency of services as well as the specific services available on them. Both sides of this equation are important in allowing Emirates SkyCargo to maintain its leadership position in the international air cargo market, according to Emirates vice president cargo commercial development, Dennis Lister. “Our customer-centric approach means that we need to focus on all the above aspects at the same time rather than focusing on any one element alone,” says Lister. Lister refused to be drawn on which was the most important to the carrier’s cargo operations saying only that there were several reasons why Emirates has become the player and cargo carrier it has. “One is the spread of our global network - we operate our aircraft to 159 destinations across six continents,” Lister tells Air Cargo Week. That’s also a growing list. “For 2018, we have already started new freighter services to Maastricht and on the passenger side we’ve got launches to Stansted and Santiago de Chile in the pipeline,” Lister adds. This not only includes the main hubs but also other regional destinations allowing more direct shipment options for our customers without the need to truck their cargo to a hub, says Lister. He also pointed to the frequency of services. This means Emirates Sky Cargo is able to offer more connections so that cargo can reach destination more quickly with “the innovative equipment we have rolled out.” This includes: White Cover thermal blankets, its fleet of Cool Dollies, and White Containers and its customised transportation solutions or several industry verticals which bring together its expertise and its strengths. “We’ve also recently launched Emirates AOG, our ‘must fly’ rapid transport offering to help airlines transport aircraft parts quickly to repair grounded aircraft,” says Lister. “E-Commerce is another big focus area and Emirates SkyCargo is actively exploring oppor-

tunities that combine our strengths of network with over 155 destinations and high frequency flights on an all-widebody aircraft fleet,” he adds. As for how all this will impact its bottom line in the current year Emirates is cautious and like so many others in the air cargo industry maybe still digesting what happened last year – generally acknowledged to be a good year all round. “We expect to see strong demand continuing into 2018, although demand may be more stabilised,” says Lister. “We transported 2.5 million tonnes of cargo in the calendar year 2017 and saw a good increase in the volumes of some of the specialised cargo, such as pharma, that we transport.”

A lot of horsepower

Moving horses is highly relevant in the Gulf States where Emirates SkyCargo has pioneered a distinctively high-end way of moving, feeding and looking after its four-legged passengers. Emirates SkyCargo most recently flew some of the world’s most highly rated racehorses. We are talking names such as West Coast, Mubtaahij and Talismanic, from their homes to Dubai. Emirates SkyCargo has also transported past champions including Arrogate in 2017 and California Chrome in 2016. Moving some of the world’s most valuable, loved and reported animals is not without challenges for the airline. Emirates has even gone as far as to adapt its planes for the horses height and in order to ensure their comfort when travelling. “Emirates SkyCargo has developed customised horse stalls keeping in mind comfort and safety requirements of horses. These horse stalls can be directly loaded into the freighter aircraft,” Emirates senior vice president - cargo planning and freighters, Hiran Perera tells Air Cargo Week. Emirates SkyCargo’s Boeing 777 freighters have seating space at the front of the aircraft, which can accommodate up to nine people. “This allows for qualified and trained grooms, and vets to travel along with the horses. The seating space is connected to the main deck and this allows them to go and check regularly on the horses,” explains Perera. 26/04/2018 12:38

MIDDLE EAST Nothing will block Qatar Airways Cargo from growing


ven Qatar Airways admits the roll it is on, one it believes will continue beyond this year, is “amazing.” This view is based on exponential growth on all fronts, such as network, product, tonnage and fleet, Qatar Airways Cargo chief officer cargo, Guillaume Halleux tells Air Cargo

Week. “Network-wide, our tonnage rose by 19 per cent in 2017 compared to 2016 with Europe being our highest growth region at 23 per cent tonnage increase. There was huge demand for our QR Charter service, with a 41 per cent increase in this financial year over 2016/17,” Halleux says. Making Qatar more unusual is not the optimism, but their belief there is more of the same to come. Others agree 2017 was cracker but cautiously say that does not mean this year will be. Not so Qatar Airways. “There’s no signal in the market to indicate negative trends during 2018, so we expect 2018 to be as good as 2017,” says Halleux. He points out pharma, perishables and e-commerce rely on air cargo and are now major industries. The e-commerce explosion as he referred has had a profound effect on manufacturers and retailers who are seeking air cargo services to reach their customers, meaning the long term growth is a part of the future. “The cargo division has been experiencing significant growth each year. Our FTKs in 2018 (YTD February) grew by nearly 22 per cent over 2017 (YTD February). Long-term support from our clients, new emerging markets, booming e-commerce and increase in specialised products such as pharmaceuticals, perishables and live animals are the contributing factors,” says Halleux.

ern standards, has been blockaded by its neighbours although this “has not slowed our plans,” Halleux points out. “We were already expanding our network and focusing on product enhancements and continued doing so during the blockade period. The airline transported 19 per cent more cargo in 2017 as compared to 2016, and we expect the trend to continue in 2018. It would be easy to suggest this growth is only due to the blockade, but it is also due to our network development,” he says.

The only point on which Qatar Airways does not have the same bounce is on the issue of competition although even then its comparative. The Middle East and especially the Gulf region in which it sits have several good hubs, all of whom know this and most of whom aspire and work towards this. Still, Qatar Airways has a good pitch: “Qatar Airways Cargo is perfectly and strategically positioned at the brand new Hamad International Airport with its state-of-the-art facilities. Qatar is an ideal hub-and-spoke gateway,” he says.

New destinations

To tap these markets Qatar has a good line up of belly-hold destinations in 2018 with several passenger services to Asia and Eastern Europe being launched. The Doha-based carrier recently became the first Gulf airline to begin direct passenger services to Luxembourg. “Other exciting destinations include Cardiff in Wales and London Gatwick in England. The new belly-hold flights will increase our overall capacity from the UK by more than 240 tonnes each week,” Halleux says. Other upcoming destinations include Tallinn, Estonia; Valletta, Malta; Cebu and Davao, Philippines; Langkawi, Malaysia; Da Nang, Vietnam; Bodrum and Antalya, Turkey; Mykonos, Greece and Málaga, Spain, he adds. This follows a busy 2017 when Qatar Airways started freighter services to eight destinations: Sao Paulo, Quito, Buenos Aires, Miami, Pittsburgh, London Heathrow, Phnom Penh and Yangon. And to meet growing demand across its growing network five new Boeing 777 freighters and new home base facilities. “We have invested in multi-billion dollar warehouse and transit facilities at Doha hub to provide 2.4 million tonnes capacity annually, when our second cargo terminal (CT2) project is ready,” says Halleux.

Keeping its cool

Qatar Airways Cargo has been operating at the Hamad International Airport since December 2013. The facility is equipped to handle 1.4 million tonnes cargo annually so in future it will have more scope to meet demand. “Last year, we inaugurated the airside Climate Control Centre, our biggest enhancement to providing a seamless cool chain. This 2,470 sq m transit facility handles about 285,000 tonnes of cool chain cargo, making it one of the largest airside pharmaceutical centres globally,” says Halleux. Not that it plans to stop there with product and service enhancement being one of our key focus areas, says Halleux. Earlier this year, it received the Qualified Envirotainer Provider Training and Quality Programme (QEP) accreditation recognises air cargo carriers’ compliance in operating Envirotainer containers according to Good Distribution Practice (GDP). The airline also recently added CSafe’s newest RAP container for large volume pharma shipments. “We have heavily invested in technology and innovation, enhancing our products such as QR Mail and QR Express, simplifying business processes, all for the benefit of our clients and will continue to do so in the next five years,” says Halleux. What makes all this all the more interesting is it comes at a time when Qatar, for complex political reasons, even by Middle East-

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Industry failed to meet peak season expectations


ast year was a peak season like no other, featuring unprecedented e-Commerce demand, a year-end, mad scramble for capacity, infrastructure crunches and soaring prices which even threw up a fabled million-dollar charter from Hong Kong to the US, writes Donald Urquhart. And just for novelty in all this frenetic activity, there were the Coca Cola charters to Puerto Rico in the aftermath of Hurricane Maria. All-in-all, a rather unusual year one might say. Describing Q4 2017 as “complete mayhem” for much of Batliwala the air cargo industry,

particularly in Europe, Chapman Freeborn CEO Russi Batliwala, states frankly that as an industry, it was – in contemporary parlance – pretty much a ‘fail’. Despite all the industry knowledge and projections, “we failed in my opinion – we got to point in last quarter and were caught with our pants down as an industry,” he says. There are a number of reasons he says, pointing to the fact that “airlines weren’t really prepared for the major upturn,” so crewing was a problem, aircraft were scheduled for maintenance and of course a lot of carriers that have operated freighters “in the past just haven’t seen the viability of operating freighters, so there was added crunch on capacity,” he said. Airports were also a key bottleneck, either maxed out in terms of capacity, or just not prepared in terms of manpower for instance, to handle the deluge of cargo. Batliwala notes a

lot of cargo shifted to secondary airports, but many of these were not equipped and/or not prepared to fully handle the cargo.

Flood of e-commerce

And of course, let’s not forget the e-Commerce wildcard that was a key factor in opening the cargo floodgates. In a similar, but perhaps less dramatic form, Air Charter Service group cargo director, Dan Morgan-Evans, agrees that “people got caught out,” adding, “the end of last year was incredibly busy, we did a lot of charters, Asia to Europe, transpacific and we did have problems with capacity, but there was never really a situation where we ever said: ‘I’m sorry we just can’t help, there’s nothing available.’ There’s always something available, there’s always something out there,” he says. “So yes we had issues with infrastructure, airports that were congested where everybody wants to land into one certain airport and it got to the point where they said we can’t offload you so you just have to find another airport. “It was difficult, but I think that why it’s important to add that value to the customer,” he says adding that in this kind of situation is where experienced and well-trained brokers shine. This year looks no different say the brokers who are upbeat on where the market is and is heading this year. “We’ve been off to good start, no complaints at all,” says Morgan-Evans adding, “we’re up from last year which is really, really good considering last year was such a good year.” But his worry, probably like much of the industry, is whether they can emulate last year. For now at least, that seems a small problem. HAE Charter president, Americas Ian Hutchinson his company’s charter business is up year-on-year “significantly” with expectations the demand to continue to grow. And importantly, while Chapman Freeborn’s Batliwala expects a strong last quarter, he feels “the chaos

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of 2017 will be avoided with better planning.” It is clear that the charter sector is undergoing some measure of change, in concert of course with the air cargo sector in general, being so intrinsically linked as it is.

Pulling back capacity

The pull-back amongst combination carries, in particular, of some of their maindeck capacity is one important change within the industry. It is something that Morgan-Evans observes these operators may regret at some point. For Batliwala, this is clearly having some degree of impact on the market and “the last quarter of 2017 was proof of that,” he says. For HAE Charter, Hutchinson says: “We are lucky to also be the cargo GSA for a number of combi-carriers so we can still access capacity as required. Our regional teams co-ordinate the cross trade demand very well – by being a GSA we have access to many airline relationships a normal broker would not and we believe this gives us the edge on the business we have won recently.” Considering the development of the market, Morgan-Evans observes that scheduled freighter operations are not necessarily what the market is requiring. “They want to be able to increase capacity and decrease capacity on demand,” he says, point to the fact forwarders are coming to Air Charter Service at the beginning of the year and looking to book up aircraft throughout the year on the sliding scale. “That rigid schedule system doesn’t work so well in this e-Commerce market because you get very strong peaks. All you need is Amazon to say next week is a big sale and suddenly you get this random peak that people have to deal with.” And then there are also product launches and the like, that require ad hoc capacity as well. “So this creates little peaks outside of the normal and people want to have more control over their schedules,” he adds. 26/04/2018 12:41


Changing demand creates new business areas


his then creates a new area of business for charter brokers and operators, Morgan-Evans says: “I think certainly for now, those combination carriers and main deck operators cutting back a bit, this creates a space for us to help customers and shippers find capacity. It’s definitely good for us,” he says. The changing demand in passenger aircraft type is also an important factor he says, with the new A350s and B787s being smaller, lightweight aircraft with more limited cargo capacity than the B777s. “When the B777 came out and became everyone’s number one choice on the passenger side it created a lot of belly freight capacity and it pretty much killed the DC-8 freighter market. All the Middle East carriers that have that capacity in their bellies wiped out the 40 tonne aircraft and I think now as we move into these more economical ‘plastic’ airplanes that carry less freight we’ll see a market for us to fill that gap.”

Controlled capacity

Another emerging trend identified by Batliwala is the move towards ‘controlled capacity’ whereby shippers and forwarders want their own dedicated aircraft on specific routes. “There are many examples of this and although not new, I believe this is the trend going forward. This can be a dedicated B747 freighter once a week to China for example or a B737 freighter operating a specific route for a client every weekend. This can be short-term or long-term, the opportunities are there,” he says. A recent example of this is the move by US-based forwarder, Flexport to operate a twice weekly B747-400F between Hong Kong and Los Angeles through Western Global Airlines. In agreement, Morgan-Evans says this is one reason Air Charter Service has stepped up its presence with more offices in the Far East over the last year. Although as Batliwala noted this captive capacity idea is not new, with Morgan-Evans agreeing saying this was the case at least 15 years ago, but faded in popularity. “I think it’s now back again Hutchinson where forwarders are capturing capacity earlier in the year so they don’t have this problem in the peaks,” he says. For HAE Charter, a strategy that is working well in this current environment is the provision of a combination services including pure charter, part charter and diversions, “which means as demand for full loads reduces, our solutions are still competitive and seen more and more as alternatives are sought to normal straight forward brokerage,” said Hutchinson. Chapman Freeborn sees this as well, with Batliwala saying the air charter business is “becoming more and more a niche within a niche – simply buying/selling a charter is almost too easy. “We have been diversifying our business for several years and looking at niche charter markets that complement our global network. For example, our group company, Intradco the animal transportation specialists owns its own horse boxes and cattle stalls and offer a complete package of aircraft charter, stalls and the knowhow, that is very rare,” he says.

Heydays and bad days

And there are also niche products like on-board courier services which Morgan-Evans says has been performing very well for Air Charter Service. The company is also focusing on products that will increase their market share in the coming months 18 months, he says while declining specifics for commercial prerogatives. “It is a project of mine to increase the number of industries that we are covering. We’re focusing on making sure we don’t become too focused on one thing. “I’ve been in the business long enough now to know that you cannot rely on one industry, the natural fact in life is that every industry has their heydays and they have their bad Morgan-Evans days!”

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LUXEMBOURG Cargolux passes one million tonnes and has a record year


argolux Airlines International has had its best year on record with a significant increase in profits and handling over one million chargeable tonnes for the first time. Profits increased from $5.5 million in 2016 to $122.3 million in 2017 with market demand remaining high resulting in the airline generating a record 131,212 block hours and average daily utilisation exceeding 15 hours. The airline embarked on a transformation journey with the launch of its 2025 strategy focusing on ensuring that the airline remains sustainable. It says this includes a comprehensive review of all of its business processes, technological developments and innovation to make it easier to transact with customers, develop new products and focus on the well-being of employees. Cargolux president and chief executive officer, Richard Forson says: “The outstanding results for 2017 are a reflection of Cargolux employees’ dedForson ication, passion and commitment to

make this year a successful one on all fronts. “Our employees are at the heart of Cargolux’ success and continually endeavor to ensure all requirements are met to provide customer satisfaction and ensure business sustainabil-

ity. At the same time, I would also like to thank all of our loyal customers for their support.” Highlights of the year including carrying in excess of 250,000 tonnes ofForson freight to and from China, including 147,000 tonnes to and from Zhengzhou to establish Cargolux as the largest cargo carrier at the hub. Cargolux operates between 19 and 25 weekly flights to and from Mainland China depending on the season, and during a state visit by prime minister Xavier Bettel in June 2017, several MoUs and agreements were signed between the governments to extend commercial exchanges between the countries. The Luxembourg-based airline entered an agreement with Emirates SkyCargo to include capacity swaps and a new Emirates operated freighter service between Luxembourg and Dubai to complement the thrice weekly connection Cargolux offers to Dubai World Central. Two new African destinations were added to Cargolux’s network with flights to Douala in Cameroon and Lubumbashi in the Democratic Republic of Congo. The weekly flights bring the number of African destinations to 14, and since July 2017 Cargolux has offered four weekly connections to Quito in Ecuador in addition to flights to Curitiba and Viracopos in Brazil, and Mexico.

First electronic consignment drives from Luxembourg

The first electronic consignment for road transport has been signed off for services between Luxembourg Airport and Amsterdam Airport Schiphol. Luxembourg’s secretary of state of the Ministry of Sustainable Development and Infrastructure, Camille Gira signed the note for a road service by Arthur Welter on behalf of Cargolux between Luxembourg and Amsterdam. The signature took place during the annual Luxembourg Supply Chain Day at the Cargo Centre of LuxairCARGO. As of March, Luxembourg has authorised the use of digital consignment notes for road transport after the adoption of the UNECE e-CMR protocol addition and also participates in a Benelux e-CMR project. Gira comments: “By using electronic consignment notes, logistics companies and their customers can significantly reduce administrative and environmental costs that relate to the 400 million e-CMR that are issued on an annual basis within the European Community. “In practice, 166,000 trees, 15,000 pallets and 600 trucks of paper CMR can be saved. Assuming a saving of 4.5 euro for each e-CMR, this would mean an efficiency gain of €1.8 billion for the European Union.” Highlighting the benefits, LuxairCARGO manager special services cargo, Patrick Silverio says: “In 2017, the Cargo Center of the airport operated by LuxairCARGO registered about 200,000 CMR. Document treatment, signing, stamping and archiving are definitively a time-consuming factor, which with the e-CMR will be highly reduced.” Chief administration officer for trucking firm Arthur Welter, Rene Gloden says transport orders are received from customers in a digital data format and transmitted to the driver. He says: “Consigner, driver and consignees use their smart phones for secure digital signatures. The e-CMR solution of DashDoc, currently establishing its office in Luxembourg, stores all data in a central database that can be accessed by each party.” Cluster for logistics Luxembourg director, Malik Zeniti adds: “This is an important step for the Luxembourg hub allowing a stronger data integration of records driving digitisation in the transport and supply chain sector. It positions the Benelux at the head of Europe facilitating movements of goods with electronic consignment notes thus accelerating their acceptance throughout Europe.”

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11 23/04/2018 16:51

Looking at what people in the air cargo industry are thinking about

Annie, get your gun! We’re going on a flight


isturbing news from cousin Airway Billy Bob last week: Transportation Security Administration (TSA) officers prevented a South Carolina woman from bringing a loaded handgun on board a plane at a Charlotte Douglas International Airport checkpoint. The woman was stopped by TSA officers with a loaded .22 Magnum revolver. Billy Bob was nonplussed but the family this side of the Pond was shocked. It seems TSA Transportation Security Officer Matthew Cole detected the firearm as the woman’s carry-on bag passed along the conveyor belt in the checkpoint X-ray machine. Cole naturally contacted the Charlotte-Mecklenburg Police Department, which responded to the checkpoint. The passenger was questioned and arrested on a local charge of carrying a weapon on airport property. To date, TSA officers have detected 17 firearms at just CLT checkpoints alone this year. TSA found 68 firearms at CLT last year. We in the Airway family know there is a right way to travel with a firearm and a wrong way. The wrong way is to bring it to a checkpoint. Passengers are permitted to travel with fire-

arms in checked baggage if they are unloaded, packed in a hard-side case, locked, and packed separately from ammunition. Then the firearm must be taken to the airline check-in counter. TSA has details on how to properly travel with a firearm on Airlines may have additional requirements for traveling with firearms and ammunition so travellers should contact their airline regarding firearm and ammunition carriage policies. It’s not like the Airway family are strangers to Magnums. I myself am partial to a Wall’s Magnum ice cream; Billy Bob loves his .22 Magnum; and Airway Guillaume (or lettre de transport aérien Guillaume as we like to call him) in France can knock back a 1.5 L Magnum, equivalent to two standard 750 ml bottles, or a double magnum, twice that volume. Mind you, when he’s done that, he’s not to be trusted with a loaded .22 Magnum.

I’m an emigrant, get me out of here!

UK shipping and removals company, John Mason International Movers, has partnered with ‘I’m a Celebrity… Get Me Out of Here!’ reality TV star and comedian, Iain Lee, to put a fun twist on the rules and regulations would-be British emigrants to Australia will encounter. The 9,000 mile journey to move from Bristol to Brisbane, Streatham to Sydney and Perth in Scotland to Perth, Down Under will often involve airfreight. To make the process as smooth and as easy as possible, the team at John Mason enlisted comedian, broadcaster and jungle pro, Iain Lee to create a series of fun videos giving advice and information on the ins and outs of moving abroad. The playful videos include ‘Leave It Out’, which gives tips on what you can and can’t take with you down under, including homemade Christmas decorations, fur coats, wicker baskets and even Y-fronts! UK and Australian food goes head-to-head in a ‘Blind Tucker Challenge’, where Marmite

takes on Vegemite, Fuze Tea takes on PG Tips and Freddo bars battle Caramellos. And the cheeky Iain Lee is also caught on camera in strawberry-gate round two (but without Amir Khan this time). John Mason sales and marketing director at International Movers, Simon Hood, says: “We want to reach out to our customers in a way that gets the message across without daunting lists and rules, and with a large number of our customers being fans of the ITV show, this seemed like the perfect solution. “The videos were shot in the Palm House at Kew Gardens and involved some strange props and contributors, including our jungle-savvy celebrity, three camera crew, one jungle outfit, a packet of Tim Tams, kangaroo meat, roast beef, a British flag, an Australian flag and even a pair of 8XL Y-fronts! The campaign was certainly a lot of fun to create and we hope people will have even more fun watching the videos and getting excited about their move down under.”

Artists, make a 747 your canvas

Fancy yourself as an artist and have always wanted to use a plane as your canvas? If so, SF Airlines is offering $100,000 for ideas to give its Boeing 747-400ERF a brand new livery. The competition, which runs until 19 May is designed to improve its corporate image and brand influence. The prizes consist of one winner receiving $50,000 in cash, an award certificate and an invitation to the first flight ceremony. Three runners-up will receive $10,000 in cash, an award certificate and an invitation to the first flight ceremony, and five shortlisted

candidates will receive $4,000 in cash and a certificate. The design must combine SF elements and cultural implication, with SF saying the design must be: “international, innovative, artistic, youthful, lively, flexible for extension and highly distinctive”. Designs will be reviewed for their practicality, being recognisable to the public and being innovative. The submissions will be reviewed from 21 to 29 May, with the winner being announced on 30 May. 12 30 Apr 2018 ACW news and views back page.indd 1

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ACW 30th April 18  
ACW 30th April 18