ACW North America Supplement 22

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ACW North America Supplement is sponsored by


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Your guide to the latest developments in the international airfreight industry

NORTH AMERICA RETAINS ITS IMPORTANCE TO GLOBAL AIRFREIGHT

ACL AIRSHOP: A DIFFERENT LANDSCAPE IN 2022

CargoTech: the digital future August 2022

OH CANADA! WESTJET BREAKS INTO MAIN DECK CARGO Kirsten de Bruijn Executive Vice-President, Cargo


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NORTH AMERICA RETAINS ITS IMPORTANCE TO GLOBAL AIRFREIGHT

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Home sweet home According to a new market research study by market researcher The Insights Partners on the ‘North America Air Cargo Market to 2028’ it is expected to reach $51.29 billion by 2028 from $31.20 billion in 2021 with an estimated CAGR (Compound annual growth rate) of 7.4% from 2021 to 2028. The report provides trends prevailing in the North America air cargo market along with the drivers and restraints pertaining to the market growth. Quick adoption of e-commerce platforms is the major factor driving the growth of the North America air cargo market. However, issues associated with the market uncertainty and complications of temperature-sensitive cargo hinder the growth of North America air cargo market. Given the sheer scale and value of North American airfreight, it is no surprise that the trade body The International Air Cargo Association has chosen Miami to be its ‘Home Sweet Home’. While truly international in its reach, Miami can be seen as a good choice for a location to host the organisation, not least the ease with which most areas of the world can access its various events held in the city. While the meta data may suggest a good future in the continent, on a day-to-day basis, North American airfreight is suffering the same

headwinds that other parts of the industry are seeing. The International Air Transport Association (IATA) released May 2022 data for global air cargo markets showing that the easing of Omicron restrictions in China helped to alleviate supply chain constraints and contributed to a performance improvement in May. “North American carriers posted a 5.7% decrease in cargo volumes in May 2022 compared to May 2021. Demand in the Asia-North America market remained subdued, however, other key routes such as Europe – North America remain strong. Capacity was up 6.8% compared to May 2021. Several carriers in the region are set to receive delivery of freighters this year, which should help address pent-up demand on routes where it is needed if economic headwinds don’t persist,” says IATA. “May offered positive news for air cargo, most notably because of the easing of some Omicron restrictions in China. On a seasonally adjusted basis, we saw growth (0.3%) after two months of decline. The return of Asian production as COVID-19 measures eased, particularly in China, will support demand for air cargo. And the strong rebound in passenger traffic has increased belly capacity, although not always in the markets where the capacity crunch is most critical. But uncertainty in the overall economic situation will need to be carefully watched,” said Willie Walsh, IATA’s director general.

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“Given the sheer scale and value of North American airfreight, it is no surprise that the trade body The International Air Cargo Association has chosen Miami to be its ‘Home Sweet Home”

The first airfreight shipment ever was flown on 7 November 1910 when a few bolts of silk were transported by air from Dayton to Columbus, Ohio. Sixty-seven years later, the freer movement of air cargo was actually implemented as the aviation market saw deregulation under President Carter. This was the enabler for companies like FedEx to use overnight shipping over any route rather than depending on limited belly space via passenger aircraft. The benefits became apparent for concepts including just in time shipments, investment in accurate tracking systems and, of course, today’s e-commerce. US/ Canada deregulation has been part of a greater global airline liberalisation trend, especially in Asia, Latin America and the European Union. According to a report by Airports Council International (ACI), “air cargo activity in North America has long been dominated by major international gateway airports such as New York (JFK), Los Angeles (LAX), Chicago (ORD), Miami (MIA) and Toronto (YYZ) as well as integrator hubs like Memphis (MEM) and Louisville (SDF). In recent years, airports that were previously not known for large cargo operations have experienced tremendous growth. “Much of this growth is due to e-commerce and the expansion of Amazon Air. Now, non-traditional cargo airports like Lehigh Valley (ABE), Baltimore-Washington (BWI) and Charlotte (CLT) are handling thousands of annual operations by Amazon Air. Airports like these are relatively free of congestion and located near consumers who demand the speed and convenience of e-commerce. “This development in the North American air cargo industry is truly transformational. Prior to Amazon Air, the large, but mature US domestic air cargo market had been led by the duopoly of FedEx and UPS (with participation to a lesser extent by DHL). As Amazon Air and, potentially, other new cargo airlines build their networks to accommodate e-commerce volumes, it is likely that even more non-traditional cargo airports will see their freighter operations grow exponentially.”

O, Canada! According to IATA, Canada’s facilitation of air cargo through its customs and borders regulations ranks ninth out of 124 countries in terms of the Air Trade Facilitation Index (ATFI) and 7th out of 135 countries in terms of the eFreight Friendliness Index (EFFI) globally. This facilitation has attracted investment under the ‘Through the Investing in Canada Plan’, launched in 2016. Ottawa committed over C$180 billion over 12 years for infrastructure that benefits Canadians – from public transit to trading ports. The Plan is designed to achieve three objectives across its five investment streams. To date, the Plan has invested over C$122 billion in over 81,000 projects, 96% of them completed or underway, including those that support airfreight.

South of the border IATA’s figures show Mexico’s facilitation of air cargo through its customs and borders regulations ranks 74th out of 124 countries in terms of the Air Trade Facilitation Index (ATFI) and 47th out of 135 countries in terms of the eFreight Friendliness Index (EFFI) globally. The Enabling Trade Index (ETI) ranks Mexico 51st out of 136 countries globally for the facilitation of the free flow of goods over borders and to its destination. Mexico’s airfreight connections to Latin America have grown the fastest over the last five years, though the United States and Canada remain its top air cargo partner. According to Mobility Foresights, in 2021 North America had 27% market share in the global air freight market in terms of volume. The average air freight North America ($10.75/kg) was 46% higher than global average air freight rates ($7.32/kg). This simple statistic shows that one in four consignments of airfreight worldwide were being sent to, flown from or moved within North America. That shows the scale of the industry on the continent.


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SPANNING THE CONTINENT Danny Olynick, president of ATLANTIS/ACI and ExpAir Cargo, is presiding at the time when much of the airfreight industry in North America is recovering to something like it was in 2019. Established in 1990, ExpAir Cargo is the Canadian subsidiary of Paris-based ECS Group, specialised in airline cargo sales and management. Olynick is already seeing that airfreight in 2022 is returning to what it was in 2019. He says: “The 2022 tonnage is already back to a similar level to 2019, although yields are significantly stronger. However, we are seeing a downward trend as most carriers are resuming their full network operations. It is difficult at this point to predict if the yields will continue their descent and fully revert to 2019 level, especially with the increasing popularity of longer-range narrow-body aircraft and the fact that it is hard to predict how long the current ‘passenger boom’ on the North Atlantic will last.” Because of the emergence of the long-haul narrow-body fleet, which is particularly popular on transatlantic lanes, Olynick foresees a sustained demand for freighter service. In addition, heavy demand for ocean freight will still force certain sectors of the industry to depend on airfreight, which will keep the volumes steady. During the pandemic in North America staffing was definitely a challenge, notes Olynick. “However, we made the fortunate decision as a company to maintain our workforce intact, even though our workflow diminished greatly at the beginning of the pandemic. We took this time to start new projects, establish new processes, and by the time the carriers resumed their services, we were ready. At the present time, the biggest difficulty remains the remote work, which makes training and communication more difficult. “We have been lucky to keep almost all our workforce and have even managed to increase our team. Because of the manpower shortage, the competition has been extremely aggressive regarding wages and accommodating the employees’ request for flexibility,” he says. “We are constantly looking at new projects and expansion plans, both on the GSA and warehouse divisions, so positions are always open and we are constantly seeking out new talents. This is especially true when it comes to Atlantis, our trucking division, where the need for new drivers is constant. Since our acquisition of Atlantis, the demand for road feeder services has exceeded our capacity, so every new driver joining our team means a new opportunity of development. “Our GSA management and sales offices are established in both Canada and the USA, with coverage of all main airfreight hubs. ACI Air Cargo counts on warehouse in three major Canadian locations: Montreal, Toronto and Vancouver. Atlantis, our RFS division, was initially based only in Canada, although offering transborder lanes, but our new US interstate division will be up and running soon.”

Three countries Of course there are three North American countries - USA, Canada and Mexico. Does ECS Group consider them all equal for business? “All three countries are important to us and we are continuously developing them, both in terms of customer base, service portfolio and resources. Some of our main accounts at the GSA level are Canadian airlines offering domestic and international services, making the local market extremely important for our turnaround. The same is true for Atlantis, which has daily lanes domestically and transborder. By combining our RFS, warehousing or GSA services, we deal on a daily basis with thousands of North American forwarders, consignees, shippers, airlines, etc. “Compared to Europe, the North American airfreight industry is somewhat slower to embark on the digital train. The market is still focused on interpersonal communication and exchanges and most requests

are done via email or phone. The biggest players prefer a personalised approach, asking for sales executives, key account managers and even customer service staff to be assigned to their accounts. However, we do see this trend changing over the next few years where there will be a combination: increased efficiency and transparency through booking channels like CargoAi, combined with a continued strong relationship management,” says Olynick. ExpAir Cargo, the Canadian division of ECS Group, opened in 1990, first with offices in Montreal and Toronto, and now servicing the entire territory from one of our six sales offices. The US division started operating in 2010, under the name America Cargo GSA, with representation of airlines in JFK, ORD, LAX, IAH, MIA and more. In 2020, during the pandemic, the opportunity was taken to expand services to warehousing and trucking by the acquisition of ACI Air Cargo & Atlantis Transportation Services, an already well-established company in the Canadian airfreight panorama, founded in 1974. In less than two years, the portfolio of airlines handled was increased.

ATLANTIS/ACI “We have a long history of knowing what our customers need,” notes Olynick. “The combination of handling, screening and trucking services offers a better streamlined solution not only to airlines, but also to forwarders. Our handling facilities offer a full range of services to forwarders, from regular warehousing and storage, to screening, DG check, labelling, packaging, scanning, etc. The ability for a forwarder to have his cargo being picked up or delivered, handled, secured and transferred directly to the carrier, in the same facility, is invaluable. “We recently added a brand new cooler section in our ACI division at Vancouver, to facilitate the handling and storage of perishable exports and imports, such as lobsters, other seafood and produce, now making our three ACI locations equipped with temperature control services. Freezing services are soon to be added. “There is no other airline handling and trucking company in Canada that can provide the scope of services we can provide.” ACI Air Cargo is an approved Transport Canada regulated agent, offering ramp and freight handling, both for airlines and forwarders, airport transfers, build up and break down, cross dock and storage, deconsolidation, document handling, special cargo services, temperature controlled facility and more. All of this being done in Transport Canada approved facilities, with 24/7 monitored alarm system and CCTV. Atlantis Transportation drivers can take cargo anywhere it needs to go in North America, either with daily scheduled service on multiple domestic or transborder lanes, or on ad hoc request. Airport-to-airport RFS, local cartage, FTL/LTL with a wide range of truck fleet, from roller bed, dry van, low boy, temperature- controlled, flat bed all equipped with satellite tracking and utilising all expedient Customs and Security programmes, including C-TPAP, FAST and PIP.

“We have a long history of knowing what our customers need”

Expair Cargo ExpAir Cargo is the only GSA covering the entire Canadian territory from coast to coast with a sales presence in all main airfreight hubs, such as YHZ, YUL, YYZ, YYC, YEG and YVR. It offers customers a wide range of airfreight solutions. Its close relationship with the main players of the logistics community allows it to go above and beyond to find customised options to fulfill customers’ needs. Service is offered in French and English, but also in Spanish, Portuguese, German, Arabic, Cantonese, Mandarin, Greek, Farsi, Creole, Italian, Polish and more. “There is no other GSA in Canada that can provide the scope of services that we can provide. ExpAir has more than 30 years of existence in the Canadian market and has developed a strong expertise in all facets of the logistics industry. Although we specialise in airline representation, we offer a wide range of services

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EDMONTON INCREASES GLOBAL MARKET ACCESS AS A GAME CHANGER

STOP PRESS Following the success of the Innovation Journey held during the Executive Summit in March 2022, The International Air Cargo Association (TIACA) and Messe München have launched the start.hub logistics in Miami during the air cargo forum (ACF) and transport logistic Americas 2022. “The Innovation Journey showed how vital it is for the industry to connect and explore innovations that can be applied into our businesses. We knew then that this could not be a one-off and innovation needed to be incorporated into our events going forward. The launch of the start.hub logistics in Miami is yet another step toward our vision for air cargo and we are excited that Edmonton International Airport, which has such a focus on supporting innovative startup businesses will be the first host,” said Steven Polmans, TIACA chair.

There is a long-term goal of the federal government of Canada to strengthen Canada’s trade corridors to keep its supply chains moving, strengthen the country’s economy and make sure Canadians get the goods they need on time from the four corners of the world. The $4.6 billion National Trade Corridors Fund (NTCF) is an investment in well-functioning trade corridors to help Canadians compete in key global markets, trade more efficiently with international partners and keep Canada’s supply chain competitive. The NTCF, whose funding is spread out over 11 years, ending March 31, 2028, represents a long-term commitment by Ottawa to work with stakeholders on strategic infrastructure projects to address transportation bottlenecks, vulnerabilities and congestion along Canada’s trade corridors. There was delight in the province of Alberta when the federal minister of transport, the Honorable Omar Alghabra, announced up to $100 million in funding under the fund to increase cargo and logistics handling operations at the Edmonton International Airport (YEG). The project will convert approximately 2,000 acres of land into a new global cargo handling operation. With this investment, the Edmonton International Airport will expand its multi-modal distribution throughout Canada, the United States of America and Mexico. The airport’s increased cargo capacity will improve the movement of import and export trade routes and strengthen Canada’s supply chain. “Our government is committed to keeping our supply chains resilient, and this announcement will help strengthen the economic development of the Edmonton International Airport, Leduc County and the region of Edmonton. This funding will expand the operational capacity of the airport by adding more space for cargo handling operations and new transportation infrastructure. By investing in our airports, we are creating good jobs, strengthening our economy, and maintaining a competitive and resilient supply chain,” said Alghabra. “Cargo and logistics play a major role in our region’s economic growth and development. Increasing air capacity and global market access for exports and trade opportunities is a global game changer. It drives the growth of small and medium enterprises in Alberta and the rest of Canada, which creates jobs and spurs investment. Working towards these goals, we are excited to announce the development of the International Cargo Hub. The Government of Canada’s investment into YEG will help accelerate our plans to position the Edmonton Metropolitan Region as a key multi-modal global logistics hub and vital trade corridor for Canada. This hub will be transformational for the Edmonton Metro Region,” added Tom Roth, president and CEO, Edmonton International Airport.

Future-proofing at YEG Edmonton International Airport is to collaborate with ZeroAvia, the

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leader in developing zero-emission solutions for commercial aviation, to explore opportunities to develop the hydrogen infrastructure required for delivering zero-emission flights and decarbonising ground operations. Under the agreement, YEG will work with ZeroAvia to develop hydrogen infrastructure at both the main airport and Villeneuve Airport. The partnership targets exploring the wider use of hydrogen for decarbonisation of aircraft operations as well as the airport’s ecosystem. To support the collaboration, ZeroAvia will leverage its experience in developing and operating its Hydrogen Airport Refuelling Ecosystem (HARE). The partners will begin with gaseous hydrogen as a fuel, whilst exploring a shift to liquid hydrogen – necessary to support aircraft above 50 seats. The collaboration will see ZeroAvia and YEG first conduct a pilot program which will fuel a demonstrator aircraft and other operations with the deployed hydrogen ecosystem. The next step will entail working towards establishing some of the world’s first commercial routes. This collaboration expands on an already impressive set of sustainability initiatives at YEG, including the construction of the world’s largest solar farm at an airport set to begin construction in late 2022. Arnab Chatterjee, VP, infrastructure, ZeroAvia: said: “Edmonton International Airport has been a leader in pushing the envelope in efforts to tackle emissions using innovative technology. The massive renewable installation, natural resources, flight operations and administrative autonomy, makes Edmonton a great partner for us.” Myron Keehn, VP, air service, business development, ESG, and Stakeholder Relations, Edmonton International Airport, said: “We are excited to work with ZeroAvia, a global leader in zero-emission aviation. We believe that hydrogen will be a key technology to decarbonise aviation and airport operations for a net-zero future. ZeroAvia’s innovations, achievements, and shared values made it natural for us to develop a collaboration. Airports can help drive the adoption of hydrogen, thereby reducing emissions and improving air quality across the scope of their operations and beyond.” Zero-emission aviation has the potential to better connect some of Canada’s remote and underserved regions by offering affordable and low impact travel and commerce, supported by zero emission, low noise operation of its pioneering hydrogen-electric engine technology. Some of the small, but vital routes currently operated from YEG and Villeneuve utilise the airframe type, within the target range, that ZeroAvia’s 600kW engine will support from 2024 on. The ZA600 is designed to power 9-19 seat aircraft up to 300 nautical miles and will be flight tested for the first time in a 19-seat Dornier 228 within the next few weeks.


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ACL: A DIFFERENT LANDSC “Airfreight’s footprint in global shipments will surely increase as a percentage of total cargo shipping”

How is post-pandemic confidence in the North American airfreight and general aviation market? Steve Townes, president and CEO of ACL Airshop takes stock of how the market has changed. “The pandemic caused ships, trucks and even trains to back-up and choke the supply chains, but the aircraft swooped in and so did we. It’s a very different landscape today - the world stopped travelling for two years! New habits and patterns formed. The air cargo industry adapted quickly, and some things might never return to pre-pandemic normalcy. That spells “Advantage Freighters.” “Airfreight’s footprint in global shipments will surely increase as a percentage of total cargo shipping. Even “preighters” took to the skies. Record numbers of freighters are now in production [with] backlogs at Boeing and other major manufacturers and even more aircraft are heading the MRO centres worldwide for P2F conversions. “Another encouraging market signal is the strategic wild-card entry into airfreight by some of the world’s largest ocean shippers now building their own air fleets -those huge conglomerates will likely not do this in a small way. We predict they will become gigantic game-changers in the coming years, as tri-modal juggernauts on the oceans, in the air and on the ground with their equally robust ground logistics business units. “As IATA has identified, the industry is building resilience for the post-pandemic world. Air cargo doubled in the pandemic period, providing essential stop-gap revenues for passenger airlines and feeding aggressive growth and refreshed profits for the cargo carriers. Even regional air cargo activity on smaller aircraft has picked up velocity.”

Grounds for optimism? “We are cautiously optimistic and rather fearlessly leaning-forward into the demand that continues coming our way. The economy will return, despite fears of inflation and recession, because globally world trade will not stop: demographics will keep growing, e-commerce will continue mushrooming and the cargo fleets will keep rising. The past two years have created tectonic shifts in the way people work and travel, yet goods of all types - not just vaccines - have to get there on time. “The costs of shipborne cargo and airfreight have come closer to each other, and when it takes so long for critical inventories, perishables or pharmaceuticals to get from place to place by air is becoming more prevalent. That phenomenon is turbo-charged permanently by the inexorable rise of e-commerce. The whole developed world stayed home for two years and everybody is ordering what they need and want online: full aircraft, high rates, strong trajectory. “Caution? Yes of course, prudent companies must watch for possible slumps driven by inflation and geopolitical conflicts, but for the airfreight sector, which means “tapping the brakes” a bit for a while, not wholesale cutbacks in our experience.

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“In the past seven years, we ourselves have seen three somewhat surprising external short-term shocks to our normal revenue flows. We handled those brief Force Majeure lapses with steely calm and have grown our way out safely and profitably. Whilst maintaining full employment and continued investment in our ULD fleet, new hub stations and innovative new technology services for customers.”

Post-pandemic staffing issues “Like most companies, we saw shortages emerging in our workforce. And wages in many areas have spiked due to the ‘Great Resignation’ and other factors. We made a bold decision: raise the wages for the majority of our workforce below the management level and redouble our efforts at fostering a highly collaborative high performance culture. That has worked well, and because of our productivity, we have not missed a beat on cash flows and enterprise health. “We have also increased our investments in training, not just frontline on-the-job apprenticeship style learning among co-workers, but also a cohort of management development trainees who have been identified as high-potential emerging leaders. That one-year investment in “rising stars” is already paying dividends in heightened morale and fresh new ideas for continuous improvements. We have also sent some of our senior leaders to the renowned Center for Creative Leadership to sharpen their executive skills to contend with our accelerated growth of the past 4-5 years.” How well are ACL Airshop products and services being received in the North American market? “We have been expanding steadily for years, both in North America and abroad. Our main products are fundamental and mission-critical to the movement of air freight. If the air carrier doesn’t have enough pallets, containers, straps, and nets, plus effective logistics technologies to control those assets, the planes cannot fly. That is why we dominate short-term ULD solutions, with the largest leasing-ready ULD fleet among the several other excellent independents against whom we compete. “But on top of that, we have been selectively building a handsome portfolio of very good long-term contracts of three to five years’ recurring revenues, on which we can offer even more of our “Digital Suite” for customers. “Because around 70% of all air cargo flies palletised on freighters, and we could arguably be called the “independent kings of pallets,” we find we are very well-received by clients who wish to get economically advantageous long-term supplies and services from us, or even just a few extras when needed in a pinch during peak period.”

External factors “The Ukraine war and the possible strategic threat to Taiwan could


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DSCAPE IN 2022 both affect our business and our industry sector in the next few years. Pundits say if the Ukraine war persists and lingers for years of combat, uncertainty, and hampered rebuilding, which could affect the entire world economy. And it “the balloon goes up” with Taiwan, that could literally ruin many air cargo trade lanes in Asia- Pacific. “But in the main, “chaos is our friend,” meaning that we are the speediest and largest lessor of ULDs in the industry, #1 by far when a client really needs some extra, and now building resilience and clever speed with improved technologies. I’ve said that ACL Airshop is like the cotter pin for airfreight: absolutely mission-critical, but ultimately rather cost-incidental. It’s a great business model, with customer service as its cornerstone.

Interesting developments “Most significantly, we have a new majority shareholder, the multibillion-sized Astatine Investment Partners (formerly known as Alinda Capital), and that had made a big difference in our ability to fuel growth. They have given us a bigger gas tank and a stronger foot on the accelerator: it has been a terrific new partnership.

“Our “Digital Suite” keeps growing and improving. Customers who use all of our technologies are delighted at newfound efficiencies and better end-to-end visibility. With FindMyULD we can put all of our technology logistics innovations in the palm of your hand, and as an older employee I like to say: “It’s so easy, even a CEO can do it.” !We were first in market to crate Bluetooth tracking and tracing of ULDs, and we have never stopped creatively innovating since. “We also have an intriguing strategic alliance with Sonoco Corp, a huge South Carolina publicly-traded multi-billion company that has its Thermo-Safe containers making a new incursion into cold chain air shipments. We are assisting by actually assembling those units and deploying them across our large network of feeder stations to air freight operators who need them. “In my opinion as CEO now for over six years, I will always identify our most important secret weapon. It’s our people: people are the priceless soul of any successful enterprise, and in ACL Airshop, we are proving that every day around the world. It is the privilege of a lifetime to be part of this amazing organisation of zealous experts.”

ECS GROUP COVERING NORTH AMERICA As well as its presence in Canada through Atlantis, ACI and ExpAir Cargo, ECS Group is also present in the United States and Mexico with its subsidiary Globe Air Cargo and America Cargo GSA, giving it a stronger coverage in North America. In the US, GAC has been providing partner airlines with tools tailored to their specific needs since 1992. With offices in all major US gateways, including New York, Chicago, Washington, Miami, Los Angeles, San Francisco, Houston and Atlanta, and 52 dedicated employees, Globe Air Cargo provides its partners with comprehensive and in-depth knowledge of its markets. “With access to state-of-the-art technology and market data, no job is too big or too small for our network. Offering local attention while, at the same time, having access to the world’s largest partnership. Globe Air Cargo assures our partners complete coverage and a detailed oriented dedication. Our highly qualified offices offer a wide variety of services including sales,

operations, nationwide RFS, billing and financial services amongst others making us the ideal partner for your custom tailored need,” says Francisco Hernandez, country manager USA. On the other hand, America Cargo GSA is the US division of ExpAir Cargo established in 1990 with offices in New York and Chicago. America Cargo believes in the complete care customer service and has a total availability seven days a week. Established in 2008, GAC Mexico offers the same level of expertise, a signature trait of ECS Group, to support strong growth and respond to the strong e-commerce trend of the region. “In 2008 ECS Group opened the first subsidiary in Mexico GAC and also in Latin America region. Nowadays we have three companies, GAC, Newco and Skylog with 22 employees led by two talented women, Elena Garduno and Vanessa Cadaya, having offices in Mexico, Cancun, and commercial presence in MTY, GDL and PVR,” says Paco Ortega, regional VP Central and South America.

“With access to state-of-the-art technology and market data, no job is too big or too small for our network”

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OH CANADA! WESTJET BREAKS INTO MAIN DECK CARGO The 737-800 BCF narrow-body aircraft is quick to load and fly, enabling WestJet Cargo to offer its customers greater fuel efficiency, flexibility and frequency. 8

Canadian carrier WestJet has thrown its hat into the main deck airfreight ring. Just over one year ago, WestJet revealed the arrival of WestJet Cargo, a new dedicated cargo service using 737-800 Boeing Converted Freighters (BCF) to fulfill the larger-scale needs of Canadian businesses, freight forwarders, shippers and individual customers. This service would operate in tandem with WestJet’s current cargo service offering, which operates in the bellies of the WestJet Group’s passenger fleet. WestJet Cargo’s ability to ship on dedicated freighters or in the cargo hold on passenger routes provides cargo customers with increased reliability, flexibility and capacity to transport their diverse shipments to their chosen destination. Kirsten de Bruijn was appointed executive vice-president, cargo, in May 2022. She joins WestJet with a large portfolio of air cargo experience and more than 15 years in the airline industry. Most recently, she served at Qatar Airways as senior vice president cargo sales and network planning. During her time at Qatar Airways, she managed the airline’s global cargo sales organisation including product development and marketing and was responsible for the freighter network planning department. De Bruijn will play an instrumental role in building the airline’s dedicated cargo capabilities and service offerings, while growing a high-performing cargo organisation capable of succeeding within a rapidly evolving

market. “This past March, WestJet Cargo and the GTA Group announced a long-term partnership that will support the expansion and growth of cargo opportunities for both businesses. Moving forward, WestJet Cargo will work with the GTA Group to increase shipping capacity using the airline’s dedicated freighters, operated by WestJet to fulfill the country’s shipping needs,” says de Bruijn. The Canadian market maintains an even greater need for competitive choice than what WestJet saw in 1996, when the airline began passenger services. In addition to the supply chain issues being faced worldwide, Canada is a very large country, double the size of the European Union and as a result, cargo services that accommodate long-distance flying are highly sought after. “Our dedicated commercial cargo aircraft are a natural evolution of the competitive guest services WestJet has successfully provided over its 25-year history. Once in service, our freighters will provide our cargo customers with reliable on-time performance and the competitive cost advantage that is synonymous with WestJet,” she says.

Thought behind this move The 737-800 BCF narrow-body aircraft is quick to load and fly, enabling


SUPPLEMENT sively, transporting essential products. “As a Canadian based airline, we are focused on serving our country and providing much-needed choice and competition to Canadians. However, we will explore other networks as we expand, to better optimise our services.” WestJet Cargo is not a new company and therefore has a well-established organisation of talented individuals. However, as WestJet Cargo expands, so will its team as it reviews specific competencies and skill sets. WestJet Cargo, alongside WestJet, is proud to join Boeing, IATA and industry peers today to collectively demonstrate its commitment to achieving net zero carbon emissions by 2050. On June 6, 2022, WestJet joined its aviation peers for a demonstration of the industry’s collective commitment to decarbonising the aviation industry by fuelling WS 1511 between Los Angeles (LAX) and Calgary (YYC) with Sustainable Aviation Fuel (SAF). “In Canada, we in-sourced sales two-and-a-half years ago: ever since we have been building a robust organisation and will continue to do so. Outside of Canada, we rely on GSAs to support our international sales,” says de Bruijn.

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The views and opinions expressed in this publication are not necessarily those of the publishers. Whilst every care is taken, the publishers cannot be held legally responsible for any errors in articles or advertisements. No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form or by electronic, mechanical, photographic or other means without the prior consent of the publishers. USA: The publishers shall not be liable for losses, claims, damages or expenses arising out of or attributed to the contents of Air Cargo Week, insofar as they are based on information, presentations, reports or data that have been publicly I N T E R N AT I O N A L disseminated, furnished or otherwise communicated to Air Cargo Week.

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WestJet Cargo to offer its customers greater fuel efficiency, flexibility and frequency. WestJet Cargo’s routes and scheduled services will accommodate the diverse needs of cargo customers using WestJet’s existing network and highly skilled 737 pilots. Dedicated, cost-efficient and nimble narrow-body freighters will make WestJet Cargo a dynamic and strong competitor, providing services across North America and bringing a much needed choice to North Americans.

Tonnage targets “The 737-BCF has a capacity of 20 tonnes, and of course, like any cargo carrier, our goal is to ensure that we reach the maximum carrying capacity on every route we fly. WestJet Cargo has been operating for 26 years, carrying cargo in the bellies of its passenger fleet, both across Canada and internationally. “The introduction of our new freighters only serves to better optimise our assets on our narrow and wide body passenger fleet across Canada. With respect to our freighters, we are in the process of fine-tuning our network schedule,” notes de Bruijn. “While we did not convert our passenger aircraft to freighters during the pandemic, we did use these aircraft to carry cargo exclu-

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DIGITILISATION

CARGOTECH: THE DIGITAL FUTURE

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DIGITILISATION Paris-based ECS Group’s Cargo Digital Factory, Wiremind Cargo and CargoAi, have co-ordinated their digital expertise under a new technology-focused and autonomous company - CargoTech. CargoTech also supports one of the four pillars of ECS Group’s new Augmented GSA concept, comprising Commercial, Technology, Sustainability and New Abilities. We catch up with Cedric Millet, CargoTech president, in a relaxed but business-like manner as he spells out his thoughts on the future of air cargo. Launching CargoTech at a time when many major global problems, such as the Ukraine emergency and a global pandemic that stubbornly refuses to surrender, are taking the headlines may not seem to have been a sensible move. However, Millet prides himself on a pragmatism that is bolstered by a confidence that turns the question as to timing of the launch on its head. He says: “Of course there are problems in the world. If you looked at what happened, some people would have been scared and would have decided not to launch. On the contrary, I believe it is even more important that we launched CargoTech at the beginning of the year. This will increase productivity, increase revenues and foster innovation in an industry that is lagging behind.” While others in the IT and airfreight industries may have taken a negative perspective, Millet and his team bought into the CargoTech idea and went ahead regardless to launch the operation.

Digitalisation The key driver to the launch of CargoTech, despite the headwinds, considers Millet, was his belief that it is now the time for digitalisation in the airfreight supply chain to come to the fore. At this moment, more than ever, the advantages of digitalisation will work to strengthen airfreight and its supply chain activities. He says: “Digitalisation was key during Covid. Forwarders did not know which airlines were flying, what capacity would be available on those aircraft that were flying. They had to resort to old school methods of calling on the telephone or sending an email which won’t do nowadays.” He is convinced that the experience of using old school techniques will have increased awareness that they are no longer viable in a forward-facing industry. There will be a greater welcome to digitalisation in all areas of airfreight, he believes.

Human factors While IT-based companies can seem to be based solely on the twin pillars of computer hardware and software programmes, to Millet there is a third pillar of equal, or possibly greater, importance: the people in the company. The human touch in the workplace is so important to the businessman as he navigates the new workplace post-Covid. He accepts that there are hiring pressures at present that can hinder the recruitment of the talent he needs. “The hiring situation is very difficult at the present,” he admits. Another change that Covid has prompted is mass working-from-home (WFH) in many countries around the globe. “The hybrid model of working is here to stay,” he says, confirming he is fully aware of the implications for the future of work. Another key factor in the human resources at CargoTech is Millet’s understanding of the importance of the gender balance in his workforce. He points to the Cargo Digital Factory’s 50:50 male:female ratio, shared with recent acquisition CargoAi which also has a fifty:fifty ratio, as models of how the workplace might look. Hiring is always important to a company to bring in new talent and to deal with the inevitable churn of staff. People with cargo expertise married with technology knowledge are just the type that Millet seeks. In terms of cargo specialists, Millet seeks “business people, cargo business experts from the industry. In terms of technology people, I seek scientists, IT school graduates and IT professionals,” he says.

Artificial intelligence Millet is well aware of how Artificial Intelligence (AI) has, and will, shape the airfreight business. It is not something to be worried about though, he considers. “AI adds value in the way it brings an insight much more quickly than a human brain,” he says. In many people’s opinion, there are two roads to consider getting into AI use in the airfreight supply chain. You can automate everything in the chain and decimate jobs or use the technology to make better decisions. Millet is confident that the positive aspects of the introduction will prevail as the industry gains better decision-making abilities. “Digitisalisation is not about killing jobs,” he states. “digitisalisation is looking at automating things indeed, but is also and mainly about revenue optimisation.” CargoTech’s goal is to bring cargo business experts together with technology experts to fast track the air cargo industry’s digitisalisation efforts. Millet is fully behind this mission.

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