www.airlogisticsinternational.com June 2020

COVID RESPONSE 10 The sector stirs AFRICA AND COVID-19 18 A viewpoint from Kenya FREIGHTER CONVERSIONS Needed now more than ever? JUNE 2020 • AIR LOGISTICS INTERNATIONAL 24 CARGO CRIME 34 A shady business, but booming Big country North America and Canada review

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14 24

MANAGING EDITOR Alwyn Brice tel: +44 1322 221144 e-mail: [email protected] DEPUTY EDITOR Felicity Stredder tel: +44 1322 221144 e-mail: [email protected] DESIGNER Heather Woodley tel: +44 1322 221144 e-mail: [email protected] PRODUCTION 28 34 Sejal Patel tel: +44 1322 221144 e-mail: [email protected] COMMMERCIAL MANAGER Anthony Smith tel: +44 1322 221144 e-mail: [email protected] PUBLISHER Marc Young tel: +44 1322 221144 e-mail: [email protected] CONTRIBUTORS Max Gosney, Chris Lewis, Simon Miles, Ruth Nduta & Thorsten Neumann

Air Logistics International is published in February, April, June, August, October & 5 Editor’s welcome 24 Freighter conversions December. Subscription rate per year applies to UK Is there anything good coming out of A hot topic today, if ever there was and overseas: Qualifying subscription: £64 or ¤92 or US$100 the ongoing pandemic, asks the Editor one, believes Max Gosney, who talks to Non-industry subscription: £170 or ¤240 or US$250 some of the leading exponents 7 Logistics update Imperial in Turkey; forwarder fortunes; 28 COVID-19 analysis and Bolloré’s green initiatives Consultant Simon Miles reminds us that the aviation sector is more than just freight - and offers some advice 10 COVID-19 response

www.markallengroup.com The Editor notes that the sector stakeholders have been quick to rally 32 Pharma freight An update from Max Gosney, who Published by MA Business and offer help to a world in need a Mark Allen Group Company Hawley Mill, interviews Dominic Hyde of Credo on Hawley Road, Demand at Peli Bio Thermal. What has Dartford, Kent DA2 7TJ. Tel: 01322 221144 14 World analysis been the effect of the coronavirus on How did the US and Canada fare during CHIEF OPERATING OFFICER MARK ALLEN GROUP the pharma sector? And what can the Jon Benson 2019? According to responses, it was a tel: +44 1322 221144 pharma sector expect going forward? e-mail: [email protected] mixed year, finds Alwyn Brice

© 2020. All rights reserved. No part of Air Logistics International may be reproduced or transmitted in any form, by 34 Cargo crime any means, electronic or mechanical, including photocopying, recording or any information storage or retrieval ­system, without 18 Africa and COVID-19 Pandemic notwithstanding, this is one permission in writing from the Publisher. From Kenya, Ruth Nduta of Siginon area of the industry that is booming, The views expressed do not necessarily represent those of the editor or the Air Logistics International. Advertisements in the reports on the continent’s situation writes TAPA’s Thorsten Neumann journal do not imply endorsement of the products or services advertised. since the virus took hold Front cover courtesy of American Airlines 37 Digitalisation Print - ISSN 2633-2450 In which the Editor talks to Freightos’ Online - ISSN 2633-2469 20 Supply chain focus Chris Lewis declares that we now know Camilo Garcia Cervera about the status Printed by Pensord Press Ltd, NP122YA more about the supply chain than ever quo of digitalisation

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www.miami-airport.com iflyMIA | [email protected] www.airlogisticsinternational.com transportation. with theworldofair the reader uptodate and theUS,aimstobring based inbothEurope skilled teamofwriters a comprehensive and experience and,with 20 years ofindustry such, itbuildsonover titles of for thewell-established same teamresponsible ALI ALI STATEMENT MISSION Equipment News Equipment International International comes from the Ground Handling Handling Ground and . As Ramp Ramp It’s anillwind… F strange, surreal scenario. strange, surrealscenario. the globaleconomyarisingfromCOVID-19. have probablynotbeenfazedbytheBBC’s predictionofanUS$8.8trn costto self-isolated andhaveeschewedbricksmortar; thoseorderingonline same wayastheairport,islookinglikelytochangeforever. Shoppers have concomitantly hascometherealisationthatfreight chain,inmuchthe whilst carriershavebeenhell-bentonsoakingupthe huge demandforcargo, fuselages thatoncecontainedseatstoaccommodateless fractiousloads.And an extentandtherehasbeeninnovationinthisarea, making iteasierfor have hitsomeeye-wateringhighs. profiteer fromtheunusualstatusquo;tothatend,freightratesoutofChina unsettled thesector. conundrum ofdroppingdemandcoupledwithinsufficientcapacityhas elementwithintheiroperation.However,paperwork mostrecently, the especially evidentamongstthosefar-sightedenoughtohavereducedthe shippersandcarriers,businesshasbeenbrisk.This for forwarders, cargoand anything butsince.Medicalaidhastoppedthelistofnecessary when thismalaisefinallyabates. alongsideRomanemperorNero are, onefeels,likelytogodowninhistory all butignoreditspresence-onthatscore,theUSPresidentandofBrazil has merelyaddedfueltotheflames.Meanwhile,othersectionsofsocietyhave that manypeoplearecarriersyetdon’t evenknowthattheyhavethevirus, and shunnedfellowbeings.Thefindingsofmedicalbodies,whichsuggest had ahardtimeofitorhavedied;whilesometreatedliketheplague this rathermalignantstrainofbacteria.Thosewho’vesuccumbedhaveeither then rapidlyfilledbythecoronavirus. Unfortunately, hewasnotletoffthehooksoquickly, sinceitsvacuumwas three andahalfyears,thesigningofexitstrategycameashugerelief. As aBritishEditorwhoseInboxwasfilledwithBrexitnewsforcloseon Alwyn Brice,Editor E-commerce hasthusemerged thelifeline–andwinnerinthis Pressing passengeraircraft intothecargochainhashelpedmattersto Sadly, there havealsobeenthosewithinthebusinesswholookedto The cargochain,ifinthedoldrumsbeforecloseof2019,hasbeen Doom, gloomanddespondencyprobablybestsummarisestheeffectsof the page… or once,theword“welcome”seemsratheratoddswithcontentof Yes, it’s thatCOVID-19topicagain,rearingitsuglymicrobialhead. June 2020

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6 June 2020 www.airlogisticsinternational.com LOGISTICS UPDATE

MARKET MOVEMENTS Forwarders have been experiencing very divergent levels of air freight business, according to recent data from World ACD. While the top ten air freight forwarders saw volumes grow 3% on average between February and March, this was actually a mixed bag, with one losing around 9% whilst another recorded gains of some 16%. For those forwarders ranking between 11th and 20th place, as a group they were down by 2% yet individually, one recorded a loss of 40% in volumes while another gained a creditable 117%, New partnership formed merely underlining the vagaries mperial has entered into a partnership with MEX was established in 2009 as an within the operating environment. Turkish freight forwarder M Ekspres (which is international courier company by highly Perhaps unsurprisingly, the Iknown as MEX), which will see the creation experienced Turkish forwarding executives larger forwarders have benefi ted of a new multi-modal freight management Mehmet Baykut and Oktay Baykut, who had from their ability to source capacity. business housed within Imperial’s freight previously built the country’s second largest Meanwhile, the fi rst week of management capability: this will specialise IATA forwarder that was subsequently sold to March may have been the best in traffi c to, from and transiting Turkey. The Toll Global Forwarding. Following the sale, week of the year for air cargo, but business will be based in Istanbul and will Mehmet Baykut served as Country Managing the month saw an overall year-on- provide air and ocean import and export Director and Oktay Baykut served as Director year drop in chargeable weight of forwarding services to existing clients of both of Operations (and, later, sales) for Turkey. 17.7%, according to the data. Imperial and MEX, as well as new customers. This was followed by the latter’s appointment Africa and the Middle East In addition, it plans to leverage the fast as Business Development and Sales Director were hardest hit (down 28% and growing range of global destinations served – Turkey for CEVA Logistics. After this, both 32% respectively), whilst the Asia from Istanbul’s new airport, as a gateway for returned to MEX and launched it into the Pacifi c region fell 12% and the traffi c to the African continent. market as a freight forwarder in 2019. Americas dropped 17%. Freighter capacity went up, though, by 2%, but failed to offset the 39% drop in belly hold capacity. Cargo rates: what next? In terms of yields, this was a he relentless march of COVID-19 has plug the network demand, carrying belly better story for carriers, though. affected all sectors and all industries, and freight and, increasingly, making use of The Asia Pacifi c region witnessed Tone anomaly arising from its spread has the cabin space, too. Whilst these initiatives yields in dollars rising year-on-year been that of an increased demand for cargo have been unfolding there have been stories by a third; while from China, yields capacity. Given the fi nite numbers of pure of shippers with special cargoes fi nding tariffs were up two-thirds, to an average of freighters stationed around the globe, and the simply too expensive, forcing them to look US$3.58 per kilogramme. Revenues fact that a conversion takes time, it has come anew at transportation solutions. Rail and sea from China to Asia Pacifi c also as little surprise that cargo rates have been transport, unsurprisingly, have both featured jumped by a healthy 91%. creeping upwards. in this changing scenario. Freighter capacity actually Average spot rates for shipping cargo The supreme irony, perhaps, has been rose by 29% between February through the air from Hong Kong to the US that as China has got back on its feet, its and March this year, with freighter reported by the Transportation Air Cargo Index industry has been slow to reawaken; and airlines carrying 42% more cargo jumped by almost 27% within the period of when it has begun to pick up from where it left in March than the previous month, a fortnight back in March. At the same time, off, it has encountered diminished demand for giving them 81% revenue growth; in rates from Shanghai to Europe rose by 50%. its goods, since the rest of the world continues comparison, passenger airlines saw To deal with the situation, several airlines to struggle with the ongoing economic effects a cargo fall of 22%. have been using passenger aircraft to try and of the virus.

www.airlogisticsinternational.com June 2020 7 APPOINTMENTS Rolf Pickert has been named as the new Managing Director of Messe Muenchen do Brasil. TALA has announced the promotion of Michael Haskins to the post of Managing Director. Haskins has been with the company since 2018. LOGISTICS UPDATE

CARGO THEFT: Bolloré shines a beacon DATA SHOWS otal Solar Distributed Generation has our journey, in line with Singapore’s solar CRIME RISING completed a solar rooftop for Bolloré energy target 2030, towards a greener future,” TLogistics’ Green Hub in Pioneer Turn, commented Frederic Marcerou, Managing Recorded cargo crimes in the EMEA Singapore. With a capacity of nearly 1MW, Director of Bolloré Logistics Singapore. area have doubled within the space the system generates an estimated 1.3GWh “Total Solar DG is committed to helping of a year to total 8,548 incidents, of electricity per year. Over the lifetime of the its customers drive down their carbon with losses exceeding €137m. These solar rooftop, Bolloré Logistics will avoid over footprint. We are proud to pursue Total’s are the worrying statistics collected

11,500 tonnes of CO2 emissions. long term partnership with Bolloré Logistics by the Transported Asset Protection With over 2,400 panels, the solar PV system by allowing the decarbonisation of the Association (TAPA). is expected to cover 30% of the building’s company’s facilities,” confi rmed Gavin Adda, This incident rate represents power needs. Adhering to the Paris Agreement, CEO of Total Solar Distributed Generation for the highest ever fi gure recorded in Bolloré Logistics is committed to reducing Southeast Asia. “We are glad to be considered TAPA’s 23 year history as a leading 43% of its greenhouse gas emissions by as a reliable supplier in Singapore and look security expert network for those 2027 through its CSR Programme, Powering forward to keep on expanding our presence in involved in the supply chain; and Sustainable Logistics. the country.” they refl ect criminal attacks on all “Global warming is modes of transport, covering air altering how businesses run cargo, ocean freight, road freight and their operations. In Singapore, rail freight. we have over 200,000 square In its Incident Information metres of warehouse space Service (IIS) Annual Report 2019, the and 1,600 employees. It Association also reveals average is vital for us to tap into losses for major cargo crimes of sustainable energy to support €536,889, with an average daily our electricity consumption loss in the EMEA region last year of in the fi ght against climate €378,058. change. Green Hub is our The intelligence data is based fi rst building to be equipped on cargo losses reported to TAPA’s with solar panels. With this IIS by international law enforcement milestone, we will continue agencies, insurers, manufacturers and logistics service providers. Despite the high numbers, however, the Association continues to emphasise that it is still not receiving When time:matters reports on the large majority of cargo ime:matters, a specialist in high market. A total of 16 stations in Africa were crimes that it believes are occurring performance and special speed logistics, also added to the Global Express Airfreight across the region. Tconcluded 2019 with €114.8m in network. Time:matters has been fl ying to In 2019, the number of incidents revenues. The company recorded its these destinations via its new hub in Brussels rose 114.7% to 8,548 compared with second-best business result to date within a since August and its services portfolio was 3,981 in 2018. Of these, only 39.1% challenging market environment associated also expanded in 2019 to include the global of reports provided any fi nancial with the slowdown in the global economy. express transport of dangerous goods. value for the goods stolen, which In 2019, time:matters focused on building The company reports that the main accounted for a combined €137.9m. its international activities and continuously growth sectors in 2019 were in particular The Association also recorded invested in the expansion of the network, the the medical technology, life science and thefts from supply chains in more digitalisation of core business and solutions aviation & aerospace, as well as high-tech and countries in the EMEA region than for sustainable air transport. semiconductor segments. ever before – these have totalled The company’s global Sameday Air Its continued focus on sustainable business 48 compared to 35 in the previous network grew to include a total of 11 processes was another milestone in 2019, year. Of this total, just ten countries stations in a number of countries, including particularly in respect of airmates, which accounted for 94.6% of the crimes China, Japan, Singapore and Thailand. became the world’s fi rst carbon-neutral reported in 2019, with Germany, Subsidiary time:matters International onboard courier service within the context France and the UK exhibiting the Freight Forwarding, based in Shanghai, of a long-term offsetting initiative with greatest volumes of incidents. was founded specifi cally for the Chinese myclimate, a non-profi t organisation.

8 June 2020 www.airlogisticsinternational.com As part of a strengthening of its team in the UK, worked in the freight forwarder’s import department, April 1 2020. Based in Zurich the U-Freight Group has promoted Daniel Ludlow to before becoming Export Supervisor. and Duisburg, Berganus will be Operations Director of U-Freight UK, its subsidiary in the Imperial Logistics International has appointed responsible for contract logistics UK. Ludlow started his career in the freight industry as Robert Berganus to the newly-created post of Chief operations across the business’ a trainee export clerk with U-Freight UK in 2006, then Operating Officer Contract Logistics, with effect from key industry verticals.

LIÈGE’S POP-UP Cargo performance: early days INITIATIVE While air cargo volumes diminished and Morgan Stanley in reports on May same airlines are now removing seats Over the Easter weekend Liège airport rapidly in March, data for April from 4 and 3 respectively, with Goldman from these same planes to create more launched a pop-up handling facility CLIVE Data Services offered some Sachs stating: “A number of the high- space for cargo. The uniqueness of this to increase the airport’s capacity for hope that leading economists were frequency indicators we track suggest situation is refl ected in the new term bringing in medical supplies as the right - and that the decline in the global that the global economy is in the ‘preighter’ in the air cargo vocabulary, fight against COVID-19 continues. economy was fi nally bottoming out. process of bottoming out.” coined by Lufthansa Cargo. April 2020 Building B24 formed part of the For April as a whole, volumes CLIVE’s ‘dynamic load factor’ for was also unique. With a decline of agreement between the airport declined 39% year-on-year, but an April of 67%, based on both the volume 39% in volumes versus April 2019, it and Volga/AirBridgeCargo (ABC), even greater capacity drop of 45% and weight perspectives of cargo must be one of the worst months in which will lease warehouses in two highlighted the current shortage of fl own and capacity available, showed air cargo’s history. But a greater fall phases as part of the ABC plan to air cargo capacity. Air cargo volumes an increase of 4% points compared in capacity, mixed in with the urgent make Liège its European hub. Aero stabilised from mid-March to mid-April with April 2019, refl ecting pressure on need for Personal Protective Equipment Services has been looking after the and became less critical during the capacity. materials by governments around the ramp requirement whilst Worldwide most recent two weeks to May 3, 2020. “Until very recently, many airlines world, explains also why current air Flight Services set itself up for the CLIVE’s air cargo market data would have bumped cargo without cargo yields have reportedly gone warehouse handling operation. bears out the sentiment expressed blinking an eye, to accommodate the through the roof,” commented CLIVE’s The facility was due to function until by economists from Goldman Sachs luggage of their passengers. These Managing Director, Niall van de Wouw. May 31.

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www.airlogisticsinternational.com June 2020 9 COVID-19 COVID-19 RESPONSE Call to arms The cargo sector has risen to the challenge of COVID-19, notes the Editor.

t’s been a tough few months, a period that a range of Iindustries, and not just that of the aviation sector, will remember for many years to come. Cargo has risen to the surface, inexorably, since this has become the lifeline of countless communities locked down under government advice. Going back to March this year, and in the wake of the announcement of President Trump’s travel ban on 26 European countries, the cargo industry began to experience a sharp decrease in aircraft capacity between Europe and the US. The President’s bonhomie, in which he continually underestimated the Alongside many other passenger fleets, we have seen launch charter services as it severity of the virus, might specialists, Chapman Freeborn an increase in cargo demand looked to secure air cargo have wooed the domestic has been busy, and in March across the board. capacity for its customers. audience - but for the was looking to formulate a “Wherever possible, we’re The SNCF-owned company international aviation sector, solution that would add value working with clients to affirmed that ocean freight was faced with the grim spectre of to the industry. Together with consolidate cargo and sell continuing to be disrupted and grounded fleets and laid-off its subsidiary Magma Aviation, capacity at an affordable rate. that air cargo options were handlers, it was a rather Chapman Freeborn was able to It’s at times like these that severely restricted because of different story. secure nine weekly rotations on Chapman Freeborn’s global established passenger carriers Commodities such as food board its in-house fleet of office is a huge benefit – we can cancelling scheduled flights in items, pharmaceutical goods, B747F aircraft from the EU to transport smaller movements the light of the coronavirus medical supplies and consumer the US. This was in addition to by utilising capacity on booked outbreak. It therefore decided goods that would have the direct aircraft availability part-charters.” to launch a series of air charter typically travelled as belly via Avia Solutions Group sister This period has, of course, flights, the first of which freight on board passenger companies Bluebird Nordic, been a fluid and evolving time departed from Frankfurt on a aircraft now entered the ad hoc Smartlynx, Avion Express and for all, with the entire charter one-way operation to Shanghai cargo market, further tipping Klasjet. industry pulling out the stops on February 12. the balance of capacity vis-à-vis Kim Borgaard, Chapman and doing its utmost to smooth In order to facilitate the demand. The capacity issue Freeborn’s Scandinavia General out the peaks. resurgence in westbound would be exacerbated by the Manager, commented: “We freight out of China, the fact that many cargo aircraft have seen a surge in requests Forwarders stepping up forwarder followed up on were already dedicated to for cargo into the United States It hasn’t only been about February 21 with the first easing the (then) current from across Europe. In fact, charter companies, however. round-trip service departing demand in Asia. with the grounding of many Geodis was one forwarder to from Liège, again with the

10 June 2020 www.airlogisticsinternational.com A JOINT EFFORT An example of Bolloré’s early logistics co-ordination activity which operated one of its own A330-800 passenger aircraft was that of working with Worldwide Flight Services to expedite to Tianjin, in China, to collect the shipment, the trio pooled the distribution of 2m face masks to health workers in France forces and the shipment was offloaded at Toulouse for final and Spain to support the medical teams. Along with Airbus, distribution.

destination that of Shanghai Dachser aims to anticipate the Pudong International. As of needs of its customers and be February 28, weekly round-trip one step ahead by offering flights were established from timely, intelligent and flexible Frankfurt, with Shanghai solutions. We plan to continue departures each Tuesday. to expand our premium air This schedule remained in service as the needs within the place throughout March, when air freight market continue to consideration of a further grow,” added Stroh. extension was made; the service was complemented by Action in Latin America flights from Hong Kong to In Latin America, the industry Europe. Flights from Hong has also been pro-active. Dascher was one company quick to respond Kong to Guadalajara were also supply chain fluidity and air Avianca Cargo has been to the crisis and opened Europe/US routes offered in March. freight capacity. Dachser has providing an uninterrupted In the wake of the decision taken a proactive stance in freight transport service with by US authorities to close its addressing the needs of the additional routes in and out of the support of aircraft and borders to visitors from Europe marketplace by chartering B747 China, Hong Kong and South passenger crew to contribute to and to prepare for the aircraft and adding them into Korea,” explained Timo Stroh, the supply of food, medical consequent sharp decrease in its premium charter flight Head of Global Air Freight. equipment, toiletries and commercial cargo capacity, the service rotation with this “For those customers looking medicines. A B787-800 company established a return Chicago-Frankfurt-Chicago to do business in Europe, we passenger aircraft set the ball air charter programme, linking route. Prior to introducing this offer an unmatched European rolling when it undertook its Amsterdam and Chicago on a new service Dachser, in road network that essentially first cargo flight, carrying four flights a week schedule. anticipation of ongoing air creates a connection to the nearly 20 tonnes of essential The first flight from Amsterdam freight capacity challenges, entire continent when goods as belly freight from took place on March 21. expanded its premium charter dispatching out of Frankfurt.” Colombia to JFK. Aside from this air activity, flight service by introducing During these volatile and Since it has been necessary Geodis has also continued to several new charter flights, unpredictable times, Dachser’s to take additional measures for offer its rail solutions from primarily focusing on direct European customers have been the welfare and protection of major cities in China, with routes to and from Frankfurt requesting a direct charter onboard and ground return routings also available. and Asia. flight to the US for their personnel, Avianca established Geodis has not been the “With this new Chicago- time-sensitive cargo. This protocols to minimise physical only forwarder to have Frankfurt-Chicago service, our Chicago-Frankfurt-Chicago contact, as well as provide launched airfreight charter Americas-based customers route addresses that need and cleaning kits and protective operations in recent weeks: interested in efficiently allows swift movement of cargo items to its employees: Dachser, Bolloré, DSV connecting with Asia can between the US and Europe. anti-bacterial gel, gloves and Panalpina and CEVA Logistics leverage our expanded charter “Today, the marketplace digital thermometers were have all joined the fray, the flight rotation that features demands reliability and agility. given to the crew and staff latter focusing on the US/Asia members who had contact supply chain, with DSV with the public. Further, it has Panalpina enhancing its delivered alcohol and towels Chinese traffic. TOWARDS A BETTER OVERVIEW for cleaning keyboards and Responding to the supply XPO Logistics recently introduced a new digital dashboard for shippers and carriers accessories in the offices and chain disruption brought on by in response to the COVID-19 pandemic. The company integrated the tools with its carried out additional COVID-19, Dachser Air & Sea XPO Connect digital freight platform in North America and Europe. Mario Harik, Chief disinfection work in bathrooms Logistics introduced the latest Information Officer, XPO Logistics, commented: “We’re giving our customers a central and offices of the cargo addition to its charter flight source of vital information as they manage their supply chains in uncharted waters. terminals. rotation in the form of a direct Our team developed the COVID-19 dashboard in the cloud and deployed it globally “Achieving this operation Chicago-Frankfurt-Chicago in a matter of days. We’ll continue to leverage our technology to rapidly respond to has been a major logistical route: service began on March customer needs.” challenge for Avianca. 20. The multi-lingual dashboard is located in the analytics section of XPO Connect Prioritising the safety of our At the time of writing and includes daily alerts issued by states, provinces, countries and transportation personnel and operation, we COVID-19 was continuing to infrastructure sources, such as municipalities and airports. have adapted to the regulations have a serious impact on of the different countries to www.airlogisticsinternational.com June 2020 11 SMALL STEPS, BUT WELCOME Solutions and innovation have come in all shapes and sizes. For example, in the UK, Loganair has been working closely with the Scottish Ambulance Service to provide air ambulance capability.

COVID-19 COVID-19 RESPONSE A Loganair Twin Otter aircraft was converted into

continue to provide our cargo position to help the broader services uninterrupted,” FREE LICENCES OFFER... cargo community during this commented Kurt Schosinsky, Rate platform Cargoguide has been offering free user licences to help home-based time of crisis, by facilitating the Managing Director of Avianca freight forwarders stay on top of the rapidly changing market. fl ow of critical information Cargo. This got underway in March, when Cargoguide began to help forwarders who were between payers and vendors,” For its part, LATAM Cargo adapting to a new way of working; the organisation is now asking carriers to share explained Lionel van der Walt, modifi ed its freighter itinerary their rates as widely as possible in order to increase levels of transparency. President and Chief Executive in order to address capacity Offi cer of the Americas, shortages caused by the PayCargo. cancellation of passenger unprecedented pace, will allow such as airlines, ship terminals The free service has allowed fl ights in response to the us to take advantage of our and maritime operators to vendors to disclose the coronavirus outbreak. freighter fl eet in order to share key information with the availability of new capacity The airline, which operates partially meet the shortfall in 20,000 payer users in the options to payers and provide 11 B767-300F aircraft, increased belly capacity. We are working company’s online system. The them with vendor contact freighter capacity between to provide our clients with service, which permitted details so that they can quickly Santiago and Miami fi vefold in more and better choices and vendors to communicate the connect and have access to order to offer salmon exporters serve as support for the region’s availability of capacity to that currently much-needed a solution to what was economy.” payers, was instigated to help available new space. PayCargo becoming a logistics problem. He concluded: “There are the freight and shipping has been relaying these Moreover, capacity between many diffi culties, but we are community as it contended communications on behalf of Europe and South America has aware of the key role we play in with widespread challenges vendors to help overcome been increased by 20%, adding delivering supplies to countries, across the supply chain caused some of the challenges up to a total of six weekly and we will continue with our through the coronavirus currently being faced by the frequencies, largely catering for focus on providing our clients outbreak. Delta Cargo and shipping and cargo the transportation of with more solutions.” American Airlines Cargo community. automotive spare parts, general became the fi rst vendors to cargo and medicines to South Extending the communication make use of this free PayCargo Innovation at Davies Turner America, as well as network community service. The company has been doing transportation of perishable PayCargo made the headlines “PayCargo is in a unique its best to operate services and products to Europe. In addition when it launched a new, free logistics operations as near to to this, frequencies between communication mechanism normal as possible. Its North America and South via its online payment Chairman, Philip Stephenson, America were increased by platform. This allowed vendors Etihad Cargo has deployed additional says that innovative thinking almost 15%, totalling 26 cargo-only aircraft to help with demand has been central to Davies frequencies each week back in Turner’s 150 years of existence. March/April. Also announced “In the face of the disruption was a Santiago – Los Angeles caused by the COVID-19 virus, freighter route in order to offer and given the fact that the additional capacity for salmon regional trade restrictions and transportation and to ensure freight capacity are under such coverage on the US west coast. pressure, now is the time for Like others, LATAM decided that innovative thinking to to utilise its passenger aircraft continue,” he affi rmed. as freighter mules, and its fi rst In line with this, Davies destinations were those of Peru Turner has recommenced its and Mexico City, using Boeing direct Express China Rail 787-900 aircraft. Service, which offers a LATAM Cargo’s Chief door-to-door transit time of Executive, Andrés Bianchi, said: between 20 and 24 days: this “The diffi culties imposed by has been the only direct rail this contingency force us to service for groupage as well as seek alternatives to satisfy our full loads into the UK. clients’ needs. This new Davies Turner also itinerary, designed and reconfi gured some of its implemented at an logistics warehouses to increase

12 June 2020 www.airlogisticsinternational.com an additional air ambulance aircraft, allowing it to will be operating the aircraft as usual, and all have Saab 340 aircraft, capable of operating into all carry Epishuttle isolation pods for the safe carriage of received a special briefing from the airline and the Highlands and Islands airports apart from Barra, COVID-19 patients by air. Scottish Ambulance Service on the nature of the to become an air ambulance with the capability of The Loganair aircraft, based at Glasgow airport, deployment. carrying two Epishuttle pods and accompanying can operate throughout Scotland. Loganair pilots Loganair has also been busy converting a larger medical teams simultaneously.

capacity and has made services to and from the UAE, available a greater number of Etihad Cargo has stepped in pallet positions for customers and deployed cargo-only with stock that had been Boeing 787s to complement its imported, but was not required freighter fleet and keep global by end-users at that particular trade routes open. moment. This created several Initially operating 34 weekly thousand more pallet slots at flights, and serving ten its Dartford Distribution Centre markets, each aircraft boasted a for anyone with an urgent capacity of 12 lower deck requirement for additional pallets and four containers, storage in their supply chain. carrying up to 45 tonnes of Since then, the concept has payload overall. been replicated to varying United has also been degrees at its other main hubs running cargo charter flights. across the country. Utilising a portion of its large A member of the Pall-Ex Quicker by rail? Possibly not - but the fleet of passenger aircraft to capacity crisis has led some to look at network since 2005, covering specifically designed to alternatives to air operate cargo charters between Dartford and adjacent mitigate risks for customers the US and international hubs, postcodes in Kent as well as flying during the coronavirus it has been able to address the south-east London, Davies outbreak, while offering expert high cargo demand on most Turner also put its domestic advice and reassurance. intercontinental routes. distribution fleet at the The support package Swiss WorldCargo, the air government’s disposal for the includes security screening, the Commenting on the launch cargo division of SWISS, has express distribution of critical deployment of approved of Air Partner Protect, Air also started to operate cargo- emergency, medical and food operators and a quick response Partner’s CEO, Mark Briffa, only flights on some passenger supplies. evacuation. Also included has said: aircraft. Swiss WorldCargo is been medical support (in “Coronavirus continues to essentially a belly carrier, Protection time tandem with Northcott Global affect communities around the transporting high-value and Innovation, too, has been Solutions) to provide customers world and global travel and care-intensive goods on the apparent at Air Partner, as the with a quick and professional transportation are becomingly existing Swiss passenger group launched its Air Partner response to issues, wherever increasingly challenging, as network. In these Protect product. they might be in the world. new measures are brought in to unprecedented times, the Through a broad and varied COVID-19 monitoring, try and limit the spread of carrier has committed to service offering, Air Partner has updates and advice have also infection. Customers are continuing to maintain global been able to provide customers been given and the presence of understandably concerned and supply chains. with global, tailored solutions a round-the-clock, seven days a we have launched Air Partner The first route, Zurich to that meet multiple aviation week, global help facility has Protect in response to growing Hong Kong, was served by a requirements at the same time. been designed to ease customer demand. As a global aviation A340-300, with additional Air Partner Protect has been concerns. services group, we are already destinations and aircraft all able to offer bespoke solutions possible, based on customer spanning Charter, Consultancy need. and Training and Safety and “Despite the slowdown in Security, so that customers can global air travel, we are seeing ... AND FREE ACCESS FOR ALL source everything in one place. an ongoing demand for the February saw the launch of the Freightos Baltic Index (FBX) Daily, the world’s first Air Partner Protect goes one transportation of goods,” daily (and regulated) containerised freight rate index. Access to this data was initially step further by ensuring that admits Ashwin Bhat, Head of through payment of a fee but as the pandemic spread, so the company decided to customers are safeguarded as Cargo, Swiss International Air unlock access to the FBX daily rates for the remainder of 2020. much as possible when using Lines. “At Swiss WorldCargo, The FBX gives visibility to not only daily ocean freight rates but also to the larger our services at this difficult we are therefore committed to patterns of global freight supply and demand. time.” supporting logistics and Also offered was free access to WebCargo by Freightos products that can help customer needs, especially for forwarders adapt to a rapidly changing environment: this includes real-time rates and The cargo carriers the shipping of sensitive goods, eBooking for air cargo, as well as a live feed of updates from hundreds of airlines. Following the temporary such as medicines or suspension of passenger pharmaceuticals.” www.airlogisticsinternational.com June 2020 13 WORLD WORLD ANALYSIS

t would be tempting to run Team Worldwide, is well placed away with the idea that to comment on the recent 12 Iglobally, 2019 was a dire year month period. for air cargo – full stop. Certainly, there was a sense of A positive year unleavened gloom and doom, “Actually, for us, 2019 was a month after month, as very positive year in terms of freighters struggled to make US logistics,” he begins. “We sense of a marketplace that saw a growth in volumes of seemed out of sync with their trade, both domestically and at particular branch of expertise. the international level. There But to make the regional were challenges along the way, market global is to commit a it must be said, but we were mistake, for not every region able to overcome them. suffered from diminished “Much has been said about capacity or volumes. the US/China trade war but to That said, some facts have my mind, this was not a major to be recorded about the early negative factor. The reasoning months of 2020, which present behind the tariffs, that of a useful gauge for comparison bringing manufacturing with 2019. processes back into the US, IATA reckoned that might have been a sound airfreight volumes had fallen enough policy but its success by 1.9% year-over-year this was patchy – it certainly didn’t February, which it named as happen everywhere. It was the fifteenth straight month of limited in terms of success: you declining volumes. HIGHS needed companies to retool In seasonally adjusted and invest to make it work, so terms, demand fell by 9.1% it certainly wasn’t for everyone. month-over-month, which In the end we still had to IATA termed “the largest ever import materials and goods monthly decline for that and then there were series.” Looking back, February AND government exempted 2019 cargo volumes were also industries, which helped. relatively weak, which goes Actually, before the trade war some way towards explaining escalated, China had been the somewhat small year-over- outsourcing some of its year decrease. manufacturing anyhow – and In terms of freight capacity, HIGHS those countries were not that dipped by 4.4% year-on- Did the US and Canadian freight sector affected by any US embargoes. year in February, marking the “Other challenges that we first time that capacity had really suffer in 2019? The Editor looks encountered were in the area of actually contracted since back over the last 12 months. security programmes: more and February 2017. Flight more countries have been cancellations from airlines in 2020 was a lot worse. Its statistics revealed that air cargo capacity introducing security measures the Asia-Pacific region drove was some 35% lower than it had been at that time a year ago. in terms of freight processing the capacity reduction, IATA Figures published by the company also pointed to the fact that so there was more work said. Needless to say, the most trade lanes were seeing capacity reductions (compared with a involved in that area. Carrier February decreases in demand year ago) of between 30-60%. Interestingly, North America to Asia capacity and changes in were largely the result of the Pacific trade had witnessed a 17% reduction in capacity while in networked routes were other coronavirus’ impact on the the reverse direction a 19% drop was recorded. But 2020 has been, factors that we encountered.” manufacturing sector in China. and will be, a different scenario. Team Worldwide offers a Moving on, data released by And so back to 2019: was it as bad an operating environment as range of transport solutions, consultant Seabury in April people make out? not uniquely that of airfreight revealed that if 2019 was bad, Bob Imbriani, as Vice President, Corporate Development at – so had Imbriani seen any

14 June 2020 www.airlogisticsinternational.com noticeable shift between the ... 2019... still their feet, this escalation will increase, and possibly flatten off different modes? afterwards. The difficulty is that not everywhere will be geared up “A few years back, around ranks as one of to the reception of quantities of Chinese cargo until the recovery 2015, we were beginning to is assured. We have 45 facilities around the US, for example, and notice changes in transport our top three we are storing goods for customers whilst this pandemic modes,” he relates. “People years continues. Quite simply, at present, Chinese production is were looking to take the cost outstripping general demand.” Jessica Tyler, out of airfreight. This American Airlines Cargo continued in 2019, yet it was The AA way apparent that there was still For Jessica Tyler, VP Strategy & Development for American Airlines growth in cargo. much was moved by air in Cargo, to talk about 2019, it was necessary for her to go back to “Pharmaceuticals and passenger jets whilst 2018. e-commerce have driven this domestically in the US, it was “That was a record-breaking year for us in revenue, operational sector onwards; and last year trucked. Internationally performance and pounds carried. The hardest part of experiencing saw reasonable fuel prices, both speaking, there was reduced great success is figuring out how to go for more. Last year was a in the US and elsewhere, which capacity, but not as bad as really challenging year for the entire industry and especially when also encouraged the airfreight some people believe. Air cargo we use the prior year as the baseline. Even as challenging as 2019 sector. So costs were being kept performed strongly from our seemed in the moment, it still ranks as one of our top three years down. The forwarders perspective, although it on record - and that means our team just kept delivering the appreciated the strength of the certainly wasn’t the best year exceptional service we’re known for. international air cargo market on record.” “We did launch a number of new routes where we saw success: although for domestic Did he feel that the current most notable were our summer routes between Dallas-Fort Worth operational purposes, trucking upswing in cargo could mark to Dublin, Dallas to Munich and Philadelphia to Berlin. These was finding favour. Really, the the turning point for the sector locations have a lot of business flowing between them including situation wasn’t so different in general? machinery, pharmaceuticals, electronics and fruit logistics, as well last year: high value goods and “It’s quite possible. We’re as oil industry equipment and aviation parts that we were happy perishables might be put on going to witness a surge in air to help accommodate. We also introduced new service from ocean transport but shippers cargo at some point in 2020, I Philadelphia to Bologna. will always look to send a feel. We’re seeing more and “But all that said, the challenges of 2019 pale in comparison to percentage by air, wherever more cargo coming out of what our team is facing as we go to print on this article. It’s possible. There was a definite, China now and prices have amazing how our team is rallying to keep critical goods moving in positive trend last year and as gone through the roof – it’s a such a challenging health and economic crisis that reaches all 2020 unfolds, the challenges seller’s market and aircraft are corners of the globe. The American team is staying focused on are different. Certainly, being filled. As Europe and the doing our part and meeting every challenge as an opportunity to specialists like DHL, FedEx and rest of the world get back on lend our talent to the world in this critical time.” UPS are going through a boom period at the moment. US/China relations eased AA Cargo faced plenty of challenges but still “As for capacity last year, posted healthy figures Tyler goes on to say that American saw some softening in the US-China trade lane during 2019. “We also adjusted our China routes in late 2018, focusing our China flying from two hubs, Dallas-Fort Worth and Los Angeles, which did have an impact on our business, but still allowed us to meet customer needs. This year is proving to be a different challenge, however. Our network continues to change because government restrictions are drastically impacting demand, and at the same time we have been able to stand up cargo-only flights in a matter of weeks to get critical goods from Asia to the rest of the world. From May we’ve grown to 140 international wide-body weekly operations, in a time when very few people are flying.” Needless to say, last year posed challenges, in particular technological ones. “We’ve been working to modernise every aspect of our business for the last few years. In the fourth quarter of 2019, we implemented the majority of the iCargo end-to-end cargo management system from IBS. As big a technology project as it www.airlogisticsinternational.com June 2020 15 WORLD WORLD ANALYSIS has been - replacing over 90 disparate systems, some almost as old ...we have tempting to think of process as me, with fewer than ten to run our entire business end to end - engineering as an internal it is just the beginning of our ability to evolve and adapt quickly to differentiate programme, but in fact it’s one in this fascinating, dynamic industry. Our team of more than of the biggest opportunities we 8,000 people worldwide did an incredible job getting ready in ourselves in the have to differentiate ourselves both knowledge and mindset for the major transformational market in the market and serve our journey that we’re still on. We have fi ve major deployments left in customers well. Our Vancouver Tim Strauss, Air Canada 2020, and even despite the challenging environment, we’re hub has set the bar high and is committed to fi nishing the implementation because of the already seeing positive results.” magnitude of benefi ts for both our team and customers it will He goes on to mention that bring. If you do modernisation right, it’s a never-ending journey. Air Canada also saw Our team remains adaptive and we’re always in a learning mode infrastructure investments bear – that’s what allows us to navigate the most challenging changes, fruit: an extensive renovation even the unexpected ones like we’re experiencing right now. Our at its Chicago O’Hare facility team is thinking forward, putting our strengths to work for the was a case in point. This was world, and looking to learn from this experience so we emerge expanded from 24,000 square better, different and stronger partners for our customers and the feet to 61,000 square feet, and world.” gained additional dock doors, as well as cool chain AI initiatives for Air Canada enhancements, which included For Tim Strauss, VP Cargo, Air Canada Cargo, last year was a cooler and temperature- memorable on account of the progress made with Artifi cial each and every process related controlled room. Air Canada Intelligence. to the fl ow of cargo. The end also launched the CEIV-Pharma “One of the most signifi cant projects was our artifi cial result was the elimination of certifi cation process, which is intelligence labs. Specifi cally, at the end of the year, we launched ineffi ciencies and reduction of due to be completed this year. Vector AI, an application to make AI accessible to employees steps, and a much more He concludes by affi rming worldwide. The Cargo group was the fi rst at Air Canada to streamlined A-Z functioning of that Air Canada was able to rise implement a tool like this and, over time, AI will become a normal the facility. to the challenge occasioned by part of our business.” “Cargo Operations the grounding of Boeing’s 737. In 2018, Air Canada was selected to be part of an Artifi cial Excellence is one of the key “Air Canada was extremely Intelligence supercluster that was awarded funding by the pieces to our becoming a truly nimble and managed to operate Government of Canada. The “SCALE.AI” (Supply Chains and lean organisation. When we 97% of the planned schedule, Logistics Excellence. Artifi cial Intelligence consortium, which was talk about an engineered or thanks to the fl exibility of its selected by the Canadian government as one of fi ve superclusters lean approach, it starts with fl eet. Cargo saw some benefi ts to receive funding through the Innovation Supercluster Initiative), documenting how we do there, as some routes were has the goal of fostering technological leadership, creating jobs things – and having honest switched to wide-body aircraft.” and enhancing skills, enabling Canadian companies to become discussions about how we can global leaders. Hence last year Air Canada set up its AI Centre of do better. From there, we put The package specialist Excellence and several AI labs across the company, notably in the proposed changes to the For FedEx, it was an interesting Cargo and Revenue Management. test in our day-to-day work. It’s period, as it continued the Strauss continues: “Cargo’s fi rst fi eld lab resulted in a new tool assimilation of the TNT empire to estimate how much space will be left for cargo once all Cargo divison of Air Canada was the fi rst acquired back in 2016. Finally passenger factors are considered, including fuel and baggage. To section to benefi t from AI adoption completed was the operational complement this, the tool estimates how full our fl ights will be at departure and how likely it is that a cargo customer will show up with their freight. The predictive algorithms help our employees make more informed decisions and have reduced the time that is normally spent checking and double-checking pieces of information.” It was also a time of fresh fi elds for Air Canda: routes launched included those of Toronto-Quito, Toronto-Vienna, Montreal-Sao Paulo and Vancouver-Auckland. Also in 2019, Air Canada launched an Operations Excellence programme, something for which Strauss has been a strong advocate. “The project started in Toronto, where we worked with consultants and our front line and management teams to review

16 June 2020 www.airlogisticsinternational.com Key last year for FedEx was the opening of two new ground hubs

integration within the US, smaller than its business-to-business revenues, this segment has back in 2018, and has been Canada and the Middle East, become the fastest growing market and has required constant endorsing the technology along with the absorption of innovation to make satisfactory deliveries to consumers. Ramping ever since. the sales forces. But according up FedEx Extra Hours, a service that enables participating retailers The future was never far to the logistics specialist, 2019 to fulfil e-commerce orders into the evening and receive late from the company’s was above all a year of pick-ups by FedEx Express, was another step forward in the thoughts, though: in 2019 it innovation. direction of e-commerce. began development work on There was an increase in In addition, last year saw two new major FedEx Ground hubs the FedEx SameDay Bot, an capacity at FedEx Ground, open in Pennsylvania and Connecticut to serve some of the busiest autonomous delivery device thanks to an expansion in transportation corridors in the US; this marked the start of a that is due to begin real-life operations throughout the transformation in FedEx Ground operations that will allow the testing in the middle of this FedEx Ground US network, to specialist to increasingly integrate FedEx SmartPost packages given year. six days per week year-round; to the USPS into FedEx Ground standard operations, while Looking back to 2019, it this increased to seven days improving its capabilities for handling large and heavy items. In becomes clear that the US early in 2020. line with growing volumes of cargo, FedEx also saw fit to and Canada, despite the There was also investment modernise its World Hub in Memphis as well as expand its Express ongoing pressures within the in infrastructure to more Hub in Indianapolis. Behind the scenes, upgrades from the air cargo sector, emerged in effectively handle e-commerce traditional mainframe computer systems to cloud-based facilities good shape. It will be growth; and while FedEx were engineered; whilst in the air, fleet modernisation was also interesting to record their admits that its residential undertaken. experiences of 2020 next e-commerce revenues are much On the topic of IT, FedEx recognised the value of blockchain time around.

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www.airlogisticsinternational.com June 2020 17 AFRICA AND AFRICA COVID-19

he world today continues Kenya’s over-reliance on to grapple with the Chinese imports, which average TCOVID-19 virus that has 40% of the total port’s imports. snuffed out the lives of The subsequent impact of these thousands across the globe. TESTING cancellations has resulted in a This newly discovered, highly decline in cargo handled at the contagious disease has Port as well as a decline in threatened human existence, as revenue collection by the infection rates have soared, TIMES Customs Authority. The railway month after month. Having system, a major infrastructure initially begun in Wuhan, a Here Ruth Nduta, Group Marketing & project in Kenya, has yet to Port City in China, COVID-19 settle its loan with the Chinese has rapidly spread to other Communications Manager at Siginon government that is envisaged parts of the world, paralysing Group, presents an African perspective to be generated by the income economies, trade and collected via the railway from mankind’s safety within those on the sector’s current problems. the Mombasa Port and ICD countries affected. As a business. This deferral because response in the battle against states that the aviation sector disposing of flowers worth of COVID-19 is most the spread of the disease, supports 6.2m jobs in Africa; millions of dollars for lack of unwelcome and will jeopardise countries have taken a variety put another way, that is 2.6% of markets; while workers are the Kenyan government’s of measures, such as the closure Africa’s GDP. However, since being sent home either on ability to pay this loan. of border points, lockdowns, January 2020 well over 185,000 leave or are being made quarantine and curfews; social passengers have cancelled redundant. Export flowers are The manufacturing dilemma distancing has been flights and vital cargo capacity amongst Kenya’s leading The manufacturing sector has encouraged, while movements has disappeared. This has foreign exchange earners and been negatively affected have been limited to forestall negatively affected the the impact of these through its reliance on Asian the further spread of the airfreight sector, whose goods cancellations will be felt all the countries as the source of most disease. Because of these primarily comprise way to the Exchequer. intermediate inputs for interventions, trade and pharmaceuticals, chemicals, manufacturing. China was the businesses have been paralysed, flowers, vegetables and fruit, as Disruption to the supply chain epicentre of the COVID-19 pushing economies to the brink well as other items. Dr Joy Kiiru, an economist at outbreak, and its factories were of collapse, while stock markets Flower exports to key the University of Nairobi, shut down for weeks and around the world have crashed. markets such as the European summarises the resulting crisis workers placed in quarantine to Union have dropped by over as a disruption in the global contain the spread of the virus. A major victim 50% because of the result of the supply chain affecting several Subsequently, countries which The transport and logistics financial crisis caused by the sectors, compounded by relied on China for exports are sector is a major victim of COVID-19 outbreak. The Dutch globalisation and the now operating on low COVID-19. The industry, which auction has been operating interdependence of economies. inventory or are paralysed is driven by facilitating cargo below capacity and eventually Shipping from China to altogether because of a lack of movement to or from different closed, resulting in some farms Kenya has been reduced inputs to support local geographical locations, suspending shipments of drastically, with over 37 vessels production. Reliance on supports key economic sectors flowers because of the being cancelled, while others Chinese expertise in the such as manufacturing, uncertainty within the market. reported blank arrivals at the manufacturing sector has also agriculture, aid relief, In Kenya, perishable exports Port of Mombasa. These been affected by travel construction and education, have taken a huge beating, cancellations affected cargo restrictions, thus stalling amongst others. following last minute flight throughputs at the Kenya Ports production pending an uplift of However, intervention to cancellations after the produce Authority and subsequently the these same restrictions. As the stop the spread of COVID-19 had been packaged and was supply chain, with the standard world’s manufacturing capital, has made it a challenge, if not only awaiting loading on to gauge railway (which hauls it is indeed true that when an impossibility, to move goods cargo aircraft. In one instance, cargo from the port to the China sneezes, the world from point A to B: thus trade ten tonnes of fresh export inland container depot) being catches a cold. has been affected between flowers decayed through these most affected. This situation Intra-African trade has also regions. cancellations, resulting in a loss has been described as the worst taken a hit through the closure A recent International Air of approximately US$120,000. in the KPA’s history, which is of borders between Transport Association report Farmers have therefore begun ultimately a reflection on neighbouring countries.

18 June 2020 www.airlogisticsinternational.com Uganda closed its borders, while Tunisia imposed a the strengths and weaknesses of which abut Kenya, after its fi rst Intra-African lockdown. markets traditionally referred to case of COVID-19 was trade has also as superpowers as they face up announced. The move left A global battle to this ongoing global crisis. It commuters and truck drivers taken a hit through As IATA’s Alexandre de Juniac also highlights the critical role stranded, as the announcement aptly states: “Today, as we fi ght logistics entities play in the of the closure caught most users the closure of a global health war against restoration of markets and trade fl at-footed. borders COVID-19, governments must through the provision of relief It is important to note that take urgent action to facilitate such as medical supplies, Uganda is Kenya’s biggest Ruth Nduta, Siginon Group air cargo. Keeping cargo fl owing pharmaceuticals, PPEs and, in trading partner in the East will save lives.” The impact of the worst hit areas, food itself. African Community. According trade, resulting in a situation of the coronavirus continues to be Ultimately, the COVID-19 to Kenya’s Economic Survey in low revenues and volumes on felt across global markets and pandemic has reaffi rmed the 2019, the value of imports from goods traded. Other countries the aftershocks will be critical role that effi cient supply Uganda to Kenya rose to that have adopted similar experienced well into the chains play in resolving global approximately US$480m in stances to safeguard and foreseeable future. The crises such as these and in the 2018 on account of increased control its public are Kenya, pandemic has now more than restoration of trade and imports of maize, animal feeds, Rwanda and Nigeria, which ever highlighted the trading economies. milk and sugar. The border closed its airports to all interdependence between That role is one that should closures will hamper the fl ow of incoming international fl ights, countries and has questioned never be forgotten.

www.airlogisticsinternational.com June 2020 19 fast-changing situations.ChrisLewisreports. have thesystems andtechnologytokeep ontopof about theglobalsupplychainthanever, andwe months. Butthegoodnews isthatwe know far more automotive supplychainmaynotbefullyknown for The fullimpactof COVID-19 ontheinternational UNPREDICTABLE PREDICTING THE 20 SUPPLY CHAIN June 2020 FOCUS www.airlogisticsinternational.com O emergency logisticsspecialist Director GrahamLittleof comparison, saysManaging world. appeared inplacesalloverthe outbreaks havesuddenly moving, though,and could resume.COVID-19isfast for ittoliftbeforeservices was simplyamatterofwaiting the worlditaffected,and knewwhichpartsof Everyone some extentaknownquantity. affected countries. medical suppliesintothe movement ofvaccinesand has emerged,notablythe some newairfreightdemand unprecedented shutdown.But manufacturing experiencesan simultaneously driedupas lot ofairfreightdemandhas Ontheotherhand,a services. also affecteddeepseashipping bans. To someextent,ithas quarantine ordersandtravel flights inthewakeof stroke, ascarrierscancelled scheduled aircapacityata other hand,removedmost demand COVID-19,onthe created alotofpent-up on theglobalsupplychain. having anevengreatereffect other countries,andwhichis China butquicklyspreadingto pandemic, originatingin turn oftheCOVID-19 2010. several weeksinAprilandMay of Europeanairspacefor acrossawideswathe services cloud, whichshutdownair ago, itwastheIcelandicash by acrisis.Justundertenyears ishit global airfreightindustry Perhaps thenearest Also, theashcloudwasto While theashcloudsimply A decadeon,anditisthe Every fewyears,the Every extent, beenherebefore. f coursewehave,tosome

IRStone/stock.adobe.com Cargoportal to effectively plug and play online bookings and the Evolution Time Critical, was like. the Fukushima nuclear incident following the Modelling the future Tsunami in Japan in March Indeed, the current crisis could be seen as a testbed for how 2011, which badly affected things might develop in future. supplies of components from Needless to say, modern big data is a powerful tool for logistics Japan and forced car managers all over the world to oversee restocking cycles when manufacturers and others into We have things do start to move again. They can quickly fi nd out where reconsidering their supply certainly come a cargo is coming from and examine ‘heat maps’ to predict where arrangements. potential congestion might arise. Although not commonly long way since the The other interesting thing about the COVID-19 crisis is how thought of as a disaster, the we think about the use of technology in the supply chain for all fi nancial crisis of 2008 also had ash cloud types of commodity. Hitherto mundane commodities, like toilet much the same effect on Graham Little, Managing Director, paper and hand gel, which previously were deemed not to Evolution Time Critical industry; manufacturers found warrant a high tech track and trace solution, have suddenly that some of their suppliers become hot properties. Perhaps the lesson is that any goods, if were suddenly unable to being moved signifi cant distances, can benefi t from systems and produce goods, leading to IT to manage their supply chain more effi ciently. considerable supply chain much commoner today and One of the objections to sophisticated track and trace disruption. companies have contingency technology, especially for low value items, is the cost of buying plans that they can rapidly put the equipment, and the ongoing costs, such as access to cellular The good news into action. networks and the limited battery life of devices. But less can be The good news, says Little, is Niranjan Navaratnarajah, more, says Ajay Rane, Vice President of Business Development at that thanks to modern Cargo Industry Director for Sigfox, which has developed a low cost track and trace solution technology, business does Unisys Asia Pacifi c, says that based on what he describes as a 0G (zero G) system. The respond to crises and valuable information can be technology is modelled on the World War II ultra-narrowband unexpected events much more deduced from studying cargo system. effectively than it did a decade trends and other data from Sensors are placed inside containers, in much the same way as ago. previous upsets to the global with other tracking systems, but because they use so little power “It’s much easier to get supply chain. This applies both to communicate with the SigFox network, battery life is measured visibility on the ground with to the airfreight industry itself in years, not weeks or months. The concept also has an advantage our transport suppliers; it’s a and wider business. “You need in that it can be set up very quickly - useful in the event of lot faster for us to get to look at your data and dislocation or sudden changes to supply chains. SigFox also offers information to our customers. deduce what industry is doing. a global contract, so communication costs are measured in cents, And our customers also have Move from being preventative not dollars. much more robust processes in to being predictive,” he This system will not give the user a Uber-style, up-to-the- place. We have certainly come suggests. minute update on where the cargo is, but it will disclose, for a long way since the ash The other effect of the example, when a container has arrived in a port or when it passes cloud.” COVID-19 crisis, adds pre-determined waypoints. Companies have also delved Navaratnarajah, is to give a into their supply chains much further push towards online more deeply, and know a lot freight forwarding and more about their suppliers’ booking. With so many people suppliers – or even their working from home, airfreight The industry is suppliers’ suppliers’ suppliers fi rms that can offer their – and events such as the capacity online will have a always looking at sudden shortage of specialised great advantage over their paint that happened after peers still wedded to telephone ways to speed up Fukushima through reliance and e-mail methodology. responsiveness on a single supplier is less Setting up online access is Anthony Akerman, Managing Director, likely today. not in the least a complicated DAMCO UK and Ireland Dual sourcing from process now; carriers can use different parts of the world is systems such as Unisys’

www.airlogisticsinternational.com June 2020 21 SUPPLY CHAIN SUPPLY FOCUS

Technological assistance emphasis on capturing It is in the nature of crises that they are unpredictable. If we could information is needed, with predict, plan and prepare for them, they wouldn’t be crises. But better integration between could the airfreight industry respond more quickly and pro- forwarders, shippers and the actively to unexpected events, perhaps harnessing the power of airlines.” modern technology? Paul Huang, Director of Credit should be given where it is due, reckons Ferwin Move from Sales – Asia Pacifi c, at Asia- Wieringa, Global Head of Airfreight at freight forwarder DAMCO. being preventative based forwarder Tigers, says: “Generally speaking, I think that the industry reacts rather fast “As a leader for supply chain – subject to given circumstances.” His colleague, Anthony to predictive information transparency and Akerman, Managing Director at DAMCO UK and Ireland, Niranjan Navaratnarajah, an agile supply chain solution acknowledges the pressures on the industry to respond quickly. Cargo Industry Director, provider, Tigers is well Unisys Asia Pacifi c However, he notes: “With the centralisation of airlines’ prepared and fast to respond to capacity management, some decision on acceptance of cargo or this type of black swan event changes in schedules can be slower than the market requires.” He crises,” declares Rowlands, and the consequences caused.” adds: “We do see this improving and the industry is always “and we would expect that (A black swan event is one that looking at ways to speed up responsiveness to market forces.” contingency planning will is hard to predict and typically Speaking in early March, Emma Rowlands, Strategic Sales form part of any supply chain beyond normal expectation). Director at freight forwarder Kerry Logistics, argued though that plans going forward.” To combat the diffi culties, the airfreight industry could have responded better to the crisis. One weapon the industry Tigers has arranged for its staff “Due to the different policies at each airline, all have does have at its disposal, to a to work in shifts as part of a responded differently. We have seen a very supportive response greater extent than in 2010, is business continuity plan and from our own national carriers, a very prescribed response from modern information has maintained close some Middle Eastern carriers and Japanese carriers in particular, technology. Back then, online communication with and some behaviour from carriers that, in essence, can only be booking of airfreight capacity customers, vendors, overseas described as pure profi teering. It would have been helpful for and visibility of shipments as offi ces and agents to work out airlines to launch additional cargo freighters when there are they moved through the solutions and alternatives. At numerous passenger fl ight cancellations.” (As most readers are supply chain was in its infancy. the same time, it is taking aware, several scheduled carriers have since introduced or However, it is worth action over the new market increased their freighter operations or, in some cases, operated remembering that any system demand for imported medical passenger aircraft on freight-only fl ights, using aircraft belly hold is only as good as the supplies. capacity.) information that people Meanwhile, adds Huang choose to put into it. reassuringly, the forwarder is The vulnerability of the supply chain As DAMCO ‘s Wieringa preparing for another Broker Air Charter Service says that it had been inundated with points out: “It goes without e-commerce boom as people requests for charters following the virus outbreak; it has been saying that technology always do more on-line shopping. The pressing everything into service, from private jets to numbers of plays a signifi cant role. But one crisis has thus brought both larger aircraft to fl y hundreds of tonnes of surgical masks and has to deep dive to really challenge and opportunity to other supplies into the affected regions. understand the drivers behind the sector. “The supply chain will always be vulnerable to unforeseen certain decisions. To a large extent, responses do depend on data availability, which is coming from shippers. So the Tigers is well integration between shippers and forwarders is key to prepared and fast to ensuring even faster reactions. respond to this type of Here technology does play a very signifi cant role.” black swan event Akerman agrees with this Paul Huang, Director of Sales - summary: “As with most Asia Pacifi c, Tigers technologies, it is only as good as the data entered, so more

22 June 2020 www.airlogisticsinternational.com 22nd AnnualGHI Conference

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BOOK NOW! €2600 + VAT Visit: annual.groundhandling.com freighters needed CONVERSIONS 3+ to create the BY NUMBERS optimal airline business

FREIGHTER CONVERSIONS unit Conversions post COVID-19 Freighter conversions were once a niche pursuit, as airlines prioritised fleets towards servicing soaring passenger volumes. Then along came the pandemic, as Max Gosney reports.

elcome to a fictional Conversion houses like AEI are witnessing strong airline’s daily demand for B737-800 and B737-400 products WCOVID-19 crisis call. Zoom is filled with solemn mainly being deployed for faces as tumbleweed whips past passenger purposes and pax the fuselages of row upon row numbers kept on growing.” of parked aircraft in the The shortage was also background. The airline’s CEO compounded by the grounding speaks in sombre tones while of the Boeing 737 MAX, says outlining 90% reductions in Dibisceglia. Airlines clung ever pax volumes amid the more tightly to narrow-body catastrophe that is the incumbents like the A321. The coronavirus crisis. There’s first A321F aircraft is planned nothing we can do, all present to enter into the market this agree, but sit it out. summer, adding to the And then somebody potential in the ASEAN market and we really want to go for that candidate aircraft stock. interjects: “Guys, I think I market quite aggressively.” Dibisceglia comments: “The might have a solution.” To AirAsia isn’t the only tail fin you can expect to see taxi-ing crisis is likely to have released a raised eyebrows all round, he towards the cargo warehouse with increasing regularity. American lot of assets. Potentially, A321s continues: “Why don’t we Airlines launched its first cargo only flights since 1984 this March, will arrive on the market, so we convert some of the fleet to while Air France/KLM boosted schedules to deliver over 300 flights can have plenty of freighters?” a week to 67 destinations. Overall, all-cargo flights represented opportunities to buy the right Conversions: until six 14% of all flight movements in Europe this May, compared to 2% stock at the right price, and the months ago it was a niche for the same point last year, EUROCONTROL data shows. same with the engines. Due to market with fewer than 100 The coronavirus pandemic has ignited activity in a market that the unprecedented numbers of commercial aircraft converted was already experiencing a latent mismatch between supply and aircraft now sitting on the to carry freight in 2019. But demand. An “immediate and severe air cargo capacity crunch” was ground, potential valuable then along came COVID-19, proclaimed by IATA this April. Global demand for moving cargo in feedstocks for freighter shattering pax demand, the skies may have fallen 28% compared to April 2019, but the conversion can be obtained grounding fleets and capacity to deliver those goods fell 42%. The shortfall has been more easily. Values typically reinvigorating conversions as a accentuated by the lack of belly space on pax flights (down a drop by an average of 15%, but serious airline revenue whopping 75%) as COVID-19 rips up schedules. depending on the aircraft and generator. The prevailing conditions lend themselves to a very busy year vintage, potentially more than “We definitely will be doing for conversion houses. “We’ll see cargo reinstated in the market 15%.” a lot more on our Teleport place as a result of the pandemic,” explains Alistair Dibisceglia, Savings that finance houses, business side (cargo),” reveals Chief Leasing & Trading Officer at Vallair, a full service provider like Vallair, can then pass Javed Malik, Group Chief for airlines looking to lease/purchase and finance aircraft and through to potential airline Operations Officer at AirAsia, aircraft conversions. “Cargo has lower yields compared to pax, but customers, according to while speaking at a Webinar on is largely immune to an event like COVID-19 because people need Dibisceglia. the impact of the coronavirus to send goods around. In my opinion, we will see that many more “We want to reduce the on Asian aviation. “We will be airlines have cargo units within their fleet going forward.” price as much as possible. If I’m looking at aircraft we can The business case is made even more compelling by a volte-face able to lower the cost then the convert to dedicated cargo in finding and financing candidate aircraft (pax aircraft that have better it is for everybody. I want freighter aircraft. That’s the reached the end of their service life, typically of around 18-21 my customers to continue to level of investment we are years), adds Dibisceglia. “In our recent past, before COVID, we operate the aircraft in a way willing to make; we see the were struggling to find aircraft. Everything with two wings was that maximises profitability for

24 June 2020 www.airlogisticsinternational.com months was the waiting months is the years’ commercial 6 time for a candidate 12 typical lead 20+ service is 74 aircraft were US$20,000,000+ aircraft to be converted time for a full typical from a converted to freighters estimated cost of converting a pre-pandemic conversion refi t converted freighter in 2019 commercial B737 to carry freight

them so they can continue to AEI has noted a boom in airline interest, aircraft feedstock and The A321 enters the fray lease the aircraft from us.” a subsequent decline in asset prices since the pandemic struck. with superior fuel economy, Airlines looking to go down Convey declares: “We are benefi tting and will continue to see lower maintenance costs, larger the leasing route can expect to increased demand for our B737-800 and B737-400 product.” cargo doors and the ability to pay around 1% of the aircraft’s However, the AEI chief voices a note of caution over whether the hold containerised freight in total cost, according to Vallair. market is witnessing a defi nitive shift in a passenger airline both the upper and lower Leases typically run between business model towards cargo. “I don’t think so,” he says. “I think decks, compared to the B757 or four and eight years, with an this is just a spark. In the wide-body market, there’s a lack of new B737. “That’s the magic,” upfront security deposit as freighter models to buy and it’s going to be a lengthy wait to enter. enthuses Birke. “It’s a twin deck standard. This equates to two/ We’ll see some airlines expanding into conversions (narrow-body freighter which makes it much three months’ worth of lease, options being the most likely), but not a run. It comes down to more convenient for operators depending upon the credit risk/ what do you want to be in life: you can’t be the best in and integrators. The turn times rating of the airline. Leasing everything.” are quicker, less manpower is has the allure of offering a A World Fleet Forecast white paper from Avalon (pre- needed and it’s safer because lower risk route into COVID-19) forecasts the need for more than 2,000 additional cargo can be preloaded in the conversions, as the liability for aircraft to be converted to freighters in the next 20 years warehouse into the container the asset is left solely with the (https://tinyurl.com/yaf7d9oz). and protected in the aircraft fi nancier, adds Dibisceglia. “If “The crisis may improve this,” predicts Gilbert Birke, Head of belly.” you lease then you don’t have P2F Sales at EFW, joint venture of ST Engineering Aerospace and The A321 will be one to residual value risk. Think about for Airbus, which achieved supplemental type certifi cation for its watch, acknowledges Convey today’s market: some airlines A321 Passenger-to-Freighter (P2F) conversion from the European of AEI, which specialises in are grounding aircraft and the Union Aviation Safety Agency this February. “If pax volumes Boeing 737 conversions. values drop because it’s an asset recover slowly then pax fl ights are less reliable and schedules shift. However, the real battle will that can’t be utilised. Leasing The big logistics companies will want the security of dedicated not be between the world’s two protects lessees from freighters.” biggest aircraft manufacturers impairment.” Narrow-body aircraft will account for 80% of the projected but the different A321 When pondering a conversions demand. And, the arrival of the A321 in this segment conversion houses, he suggests. conversions programme, new to take on Boeing’s dominant 757 and 737 presents a fascinating “I think the A321 will make entrants should come armed sub-plot in the conversions story this year. “With our new product a decent freighter and it’s the with a long-term vision, advises we’re aiming to eat up some of Boeing’s market share,” says Birke. fi rst narrow-body, fl y-by-wire Robert Convey, Senior Vice “The prototype is certifi ed and we now have to open up new freighter. The question I have is President – Sales & Marketing conversion lines. We aim to convert more than 20 A321s per year.” that I’m not sure which at Aeronautical Engineers. conversion programme is going COVID-19 may have put to win. EFW has 14 full size conversions back on the BOXING CLEVER: COVID-19 container positions and a small agenda, but it’s an unforgiving SPARKS CABIN MAKEOVERS crew area. Precision has 13 full segment for those expecting to size container positions and a make a quick buck, he reckons. Makeshift conversions have provided a low cost way for airlines to aid in the transport larger crew area. (The of PPE and medicines during the pandemic, generate much needed revenue and cover “A B737 conversion costs fourteenth position for the operating costs of expensive aircraft assets that would otherwise have been around US$20-30m and will grounded. However, operators must meet stringent safety compliance guidelines Precision is a pallet turned take us around three years,” set out by IATA (https://tinyurl.com/ycc4z6ue) and gain approval from their OEM and transversely). And, my even explains Convey. “You look National Aviation Authority for the conversions. bigger question is that one around and wonder why not Entrepreneurial airlines have sought two potential routes: conversion house is OEM many people have been supported (EFW) and one is not 1 Cargo secured to seats and placed in overhead bins: doing conversions. First in this confi guration, packages are strapped to seats (Precision). Which will be there’s the cost: three years and secured in baggage bins. KLM says that the cargo- preferred?” of laying money out. Then in-cabin conversion can boost payload by around 40%. However, the A321 won’t be you need a year of getting Crew members must be on hand to survey the cabin at the only Airbus representative your production going and all times. making its way into the getting up to speed. It could narrow-body market. Its take you ten years to pay off little brother, the A320 – 2 Removing seats altogether: seating is removed the programme for a pure and the cabin stripped, as British Airways has Europe’s most popular pax investor. It’s a very diffi cult done with two of its grounded B777-200s, to carry aircraft – is also bound for a business case and an investor critical cargo. BA estimates that further 100 cubic freighter makeover. “The can make better returns doing a metres of capacity has resulted from the refi t. prototype conversion will thousand other things.” start soon,” admits Birke. www.airlogisticsinternational.com June 2020 25 EFW’s latest A330-300 P2F conversion, with Airbus A321 and A320 also joining the portfolio FREIGHTER CONVERSIONS

“The A320 is comparable to the through an EFW conversion, says Birke. “The reason why only we unit with an 80% load factor or B737-800 and B737-700. The offer the A320 is because of the Airbus support in relocating the better to achieve economies of A320 is very cost-efficient and AOA sensor. Without OEM data you can’t do it.” scale is another. carries more containerised He adds: “The position of the main deck cargo door of the And then, if you have the volume than the B737-800. It’s A320 is exactly the same as on the A321. So, the crucial thing is patience and the pragmatism, a good complement to the the fact that there is the original AOA sensor in the left hand diversification will pay long term A321 in terms of load factors.” fuselage, where the cargo door is being installed.” dividends. It might not happen Convey is less convinced. “I What is more difficult to re-engineer with the A320 and A321 in time to rescue your bottom don’t believe that it will be a is the GSE demands, adds Birke. “Handlers switching from Boeing line from this pandemic, but it success, as it is too small for to Airbus narrow-body freighters will need investments in could well save you from the today’s requirements. The door container highloaders for the lower cargoes, in order to load and next. is too close to the engine. If unload the lower containerised decks. It will take time to convince “Why not use the time now, they were going to launch it, customers but as soon as you have one Airbus, whether it’s an amid this crisis, to investigate: then it should have happened A320 or A321, then you can add more types.” what are my opportunities and five or six years ago.” All of which leaves prospective new airline entrants with a options for the future?” concludes Despite those reservations, tantalising proposition when considering the conversions market. Birke. EFW has secured the first More aircraft variants to choose from, at lower prices than ever, “Maybe those who never airline customer for the A320 and servicing in-demand air cargo. thought about having dedicated freighter. Challenges with the “Don’t expect to get rich quick” seems to be one pearl freighters in their fleet can look at door positioning on the aircraft of wisdom gleaned from the conversions experts. Procuring a the market opportunity in cargo. can be easily countered minimum of three dedicated aircraft in your freighter business There’s room for everyone.” 6TH AFRICAN GHI Stakeholders’ Conference

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26GHI_2020_Africa_HP_new.inddJune 2020 1 www.airlogisticsinternational26/05/2020.com 10:48 BEST STATION BEST CARGO HANDLING OPERATION HANDLER-AIRLINE INNOVATION RAMP SAFETY UNSUNG HERO GSE INNOVATION

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ALLNEW GSE INNOVATION AWARD « CATEGORY FOR 2020 COVID-19 COVID-19 ANALYSIS

Simon Miles, MD of Miles Aviation Consulting, looks at the broader aviation canvas and offers some analysis of the pre and post-COVID-19 landscape. A brave(r) new world?

few weeks ago, the we’ve seen the industry brought to its knees, and all but come the ruin that the closure of UK industry applied its to a standstill. Vast amounts of aircraft are in storage and huge coal mines in the mid-1980s Aemergency speed brakes numbers of staff have lost their jobs or have been furloughed. brought to local communities: in anticipation of what was The industry has tested and continues to test the respective the effects of those decisions about to hit us. government’s appetite to support it, and so far, the signs are not are still being felt today. In a short space of time, particularly encouraging. The year-on-year industry growth of the Although there had been we have all had to adapt to last ten years has now been, very quickly, wiped out and replaced some brief route take-up by new and frequently changing by a fight for survival. others, the likelihood of vital norms, rules, behaviours regional flying returning on and attitudes, many of them The pre-COVID-19 landscape that scale now appears to be unwritten. It takes some Thinking back a few months, and despite the overall healthy very low. Although many getting used to. However, the growth, it seemed as though the storm clouds were gathering, local routes were unprofitable, economic devastation that particularly in the UK. Big industry infrastructure projects, such they, nevertheless, created an this virus has wrought on the as the third runway at Heathrow, are all but dead in the water; essential social and commerce world’s economies seems to and there were three significant airline failures in as many years, link for those communities, suggest that we won’t be going with another inevitable failure just a few weeks ago, that of Flybe. the importance of which back to the world that we left a Whichever way you look at it, there is little positive about any of should not be forgotten or few short weeks ago in March that. underestimated as we go anytime soon, if at all. Other, previous failures, as devastating as they were, would not forward. In these few short weeks, have had quite the same impact as that of Flybe. It reminds me of At any other time, Flybe’s

28 June 2020 www.airlogisticsinternational.com demise arguably had the potential of having the most signifi cant We are starting to see some overall impact of all the recent failures, probably making the early indicators of the near headlines for many weeks. Then along came COVID-19; future and what it may look the cynics may say that it was an excellent time to bury the like. Although some airlines bad news. However, as we now know, what happened soon have been planning June after effectively dwarfed, absorbed and masked the issues restarts just in time for the that the Flybe failure had started to create. It is strange how fate northern summer season, how intervenes. many people will actually want to travel? Will COVID-19 What do we already know about the future? change our future travelling When I think about the future, an analogy related to emerging habits? Both Wizz Air and from a nuclear bunker springs to mind; it’s not knowing quite easyJet have indicated that what to expect but equally knowing that life will be different they won’t sell their aircraft from now on. The stark reality is that our industry will be a to capacity, to allow for shadow of its former self for years to come. continued social distancing. Some of the fi gures that we are already hearing are frightening. They may have anticipated the In the UK, a 35% drop in GDP and 2m unemployed are just some public mood quite well on that of the forecasted headlines. These are unprecedented times, and, point; however Ryanair has realistically, we can only guess what may happen at this point. called the move idiotic. What we do know is that the onset of the virus has repatriated Have we seen the end of much of the world’s travelling population. With a gloomy global ultra-low fares? In reality, the catastrophic debts that the surviving airlines have recently incurred, coupled with their decisions not to sell to full capacity, even for a limited time, can only really mean one thing: higher fares. With much less disposable income, it may only exacerbate the ability of the industry to rebuild quickly A brave(r) new world? to pre-virus levels. With airlines The reliance factor economic outlook, we don’t know who may travel in future, how The simple truth is that many and when. Lufthansa recently predicted that it would take and airports the industry supply chain years for global demand for air travel to return to pre-crisis levels. is almost totally reliant on With much of the world’s fl eet of commercial aircraft now burning through airlines operating aircraft; grounded and stored, strangely adding to and dwarfi ng the cash at an they, in turn, are reliant on already signifi cant amounts of also grounded Boeing 737 MAX, the travelling public and the question is when, or will, these aircraft fl y again? alarming rate, commerce to fi ll their capacity. With airlines and airports burning through cash at an Without this, the industry alarming rate, things have to change, and quickly. During mid- things have to doesn’t exist. To paraphrase: April, IATA forecasted a US$314bn or a 55% decline in passenger change, and “When the world sneezes, the revenues in 2020 compared with 2019. In addition, Ryanair’s industry catches a cold” has Michael O’Leary, referring to the upcoming, normally busiest quickly never been more appropriate. period for the industry, announced that the summer had already Simon Miles, Managing Director, Very quickly, after gone. Miles Aviation lockdown, there were reports IAG, Lufthansa Group and American Airlines are just some of that many of the UK ground the airlines announcing the accelerated retirement of signifi cant service providers were in amounts of some older aircraft. Many of the world’s Airbus A380 trouble. Not surprisingly, in operators have already grounded the entirety of their relatively early March, the BBC reported young fl eets. And Flight International recently stated that the that in the UK, Menzies, post-coronavirus fate of the type was still uncertain. Swissport, WFS and dnata were

www.airlogisticsinternational.com June 2020 29 COVID-19 COVID-19 ANALYSIS

all stating that they might not embark on some sort of fares war, which may bring more be made redundant. Many be able to continue operating casualties but inevitably, fares will have to increase to enable airlines across Europe, too for more than a few weeks. repayment of their massive debts. Simultaneously, they must numerous to mention, appear Without the necessary help, have a laser-like focus on cost reduction at a time when GSPs are to be following a similar path. this would put 25,000 jobs themselves fighting for survival. In the US, the government had at risk – and thus they were Ground handling has never been a very high margin business. proposed propping up their jointly seeking assistance from The days of airlines pushing down hard on GSPs to reduce their industry in return for partial the government. charges to the lowest possible point must now be a thing of the state ownership. The grounding of many past. More recently, there were positive signs of change; however, We’ve now clearly crossed passenger aircraft has driven a without change, we will only be competing in a race to the the Rubicon - so preparing higher than usual demand for bottom. for what happens from freighters. Flight Global reports At least, for now, airlines will not be able to offer the volumes here is vital. One of the that 40-50% of global freight of the past, meaning that the pre-COVID economics will no significant selling assets capacity is usually carried in longer stack up as they previously did. The industry must for an airline is that they the holds of passenger aircraft; recognise and accept that the reality for GSPs is that they must receive money upfront for however, the industry recorded hold their nerve when negotiating and charge a fair, competitive a service delivered at a later a 30% increase in demand for but sustainable rate for their services. time. So for the remaining freighters at the end of March. In the past, rates appear to have been artificially low. Changes pre-COVID bookings, do the While some airlines have to this are likely to cause an upward push on costs and fares. economics still stack up in reacted quickly and started In reality, and as an example, how long was a £20 one-way fare this new world? We may see filling their passenger aircraft between Athens and London (that I bought last year) ever going that they don’t; as the restart with freight, not all have. to be sustainable? The travelling public also has to accept the commences, there may be This type of service is only reality of this. more casualties. utilising a small proportion At the beginning of of available capacity, and March, Ryanair’s O’Leary whilst fully understandable observed: “You are going to in the short term, this market The most significant opportunity see more failures and more appears to be ultimately consolidation. I think in unsustainable in the longer is that of the re-set Europe... five major airlines term. In reality, few have, Simon Miles will control over 80% of overall, actually contributed the traffic.” He continued: anything significant to the “Everybody else in the next national effort during this five years is either going to crisis and, disappointingly, In recent years, some of the larger GSPs have achieved growth be taken over by, become a the national consciousness partly through acquisition. This trend may continue going partner of, or be subsumed doesn’t seem to consider the forward, particularly as some of the small and medium-size GSPs into one of those groups.” industry as key, as it does with struggle. What happens is entirely dependent on the financial I have written on several other transport sectors. It feels state of those companies involved. What is clear is that the occasions about the lack of like the industry could have industry (and airlines in particular) do need that choice. Overall, a cohesive approach across done more; we largely hear monopolistic situations are generally not a healthy way to the industry. There are more negative than positive operate. some examples of coming coverage. together, but nothing visible As we emerge, it’s clear that Going forward - industry threats and opportunities that appears to act for the fewer aircraft are likely to be There are, without doubt, more questions than answers. industry’s greater good. It is an in our skies. Less demand for Many governments have had no choice but to prop up their opportunity lost. What seems ground handlers means that respective economies (in the case of the UK, to the tune of clear is that many of the more those who survive will need to £350bn). Their rationale is that for businesses to be ready and substantial businesses are be lean, agile, innovative and effectively try to pick up where things left off, they have to be adopting a natural selection ultra-cost conscious, perhaps supported. However, for the aviation industry, as with many approach, just waiting for more than they were before. others, the situation we currently find ourselves in is, in effect, their weaker competitors to But this also creates a paradox artificial. We won’t know the full impact on business until later. disappear naturally. for, in particular, the ground British Airways, for example, furloughed 36,000 staff. The handling sector. UK government is paying 80% of their salaries. We already Looking back Airlines will inevitably know that when the furloughing scheme ends, 12,000 staff will In my 35 plus years in the

30 June 2020 www.airlogisticsinternational.com industry, I’ve lived through events and not always as resilient as we could be. Although its In April, IATA reported endless rounds of cost-cutting relative inability to make long term decisions is recognised, this that the European aviation and cost-saving, rounds of industry often makes short to medium-term decisions that can industry supported 12.2m jobs redundancies and brain drains, result in far wider-ranging and adverse effects that we originally and represented 4.1% of GDP. often resulting in throwing the envisaged. That’s not insignificant. baby out with the bathwater. However, the industry has found a way to make the world As time passes, we will It has become a way of life. smaller, brought cheaper fares to the masses, and in doing so, inevitably rebuild. However, I love our industry and have created millions of jobs globally and changed the experiences of as we emerge, at least in the dedicated all of my working many generations. short term, the strong will life to it. However, it can There are, however, opportunities. The most significant likely grow stronger and be slow, reactive, at times opportunity is that of the re-set. While continuing to promote dominate, while the weaker old-fashioned – and it often and exploit the principles of free market economics to the full, will likely disappear. Without misses opportunities through perhaps consideration should be given to building an industry innovation, enterprise and procrastination compared with masterplan with shared rules. Make it sustainable, inclusive - decisive action, the industry other industries. think of the human element. Organisations should consider has a lot to lose. The nature of our industry taking what was good and discarding what was bad. There must We must rebuild. means that we are more be razor-sharp focus on core activities, and cost-effective use of And there has never been a exposed than most to world SME organisations to support them. better time than now.

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How well is the industry coping with the impact of COVID-19? “The impact of the COVID-19 outbreak has been wide reaching and continues to evolve at a rapid rate, prompting immediate changes in the areas of pharmaceutical transportation and air cargo. “Early on, the industry had to react to flight schedules being cut, which meant rapidly replanning shipments. The The COVID-19 pandemic is likely to see reduced initial pandemic response saw cargo capacity and less ergonomic transportation of pharmaceutical companies containers on freighters chartering aircraft, with the associated pressure of utilising all the available space on board to reduce the overall cost per pallet shipped. “As a result, we had campaigns where there was the PHARMA DRAMA requirement to get a lot more ALI checks in with Dominic Hyde, Vice President of Crēdo on rental equipment in place, conditioned and ready to Demand at Peli BioThermal, to look at how the COVID-19 crisis is release to be able to support impacting the global transportation of pharmaceuticals and the those charters. This required increased co-ordination repercussions for the air cargo sector. between network stations, pharmaceutical companies and flight schedules will develop. carry shipments on the main deck and lower decks, while freight forwarders. The airlines are talking about it temperature controlled containers for pharma payloads are all “Within weeks, the freight taking years to get back to designed to go on the lower deck. forwarders got a handle on the where they were pre-pandemic, “Although we might see more cargo aircraft, if you use a revised flight schedules and the and announcements of job cuts temperature controlled container on an upper deck, you reduced availability in the are widespread, with British potentially lose all the headroom above it on the main deck, which market. With scarce capacity, Airways and Virgin Atlantic makes it less efficient.” pharmaceutical companies were cutting thousands of jobs. still looking to ship whatever “Airlines like Lufthansa, Is sea freight a viable alternative for pharmaceutical they could, whenever they Qantas and Delta are looking at transportation in the light of the changes happening in the air could, because they didn’t retiring certain aircraft early cargo industry? know how the situation was and most of those aircraft will “There has been a trend in recent years for more pharmaceuticals going to develop further.” be the older and larger variants to transfer to sea freight, and while I expect that will continue, the in the fleet.” existing problems with sea freight are going to remain unchanged. Has there been a decline in air “When you look at the at the size of the 20 foot and 40 foot cargo capacity for What are the repercussions of reefers used on sea freight, this includes a lot of product to put into pharmaceutical transportation these changes with the airlines one container, which potentially has a single point of failure mode, since the start of the COVID-19 and aircraft? leading to higher commercial risk. crisis? “I think we will end up with “Sea freight is much slower and even pharmaceutical companies “While there have been leaner fleets with smaller, more that do use sea freight today still use air freight to top off that downturns in air passenger fuel-efficient aircraft and a capacity where faster response time is needed. It could be an numbers in the past material drop in the available unexpected spike in demand and the only way to get that product surrounding SARS during 2003, cargo capacity moving forward. to the market quickly is air freight. the level of this lockdown is The cargo airlines will be “There won’t be a day when everything goes by sea freight but unprecedented. positioning themselves to we might see a bit more going that way. However, the value “Moving forward there is capitalise on this as much as proposition of air freight for temperature-controlled pharma is still uncertainty around how possible, as the cargo airlines going to persist.”

32 June 2020 www.airlogisticsinternational.com Has COVID-19 had an effect on enough air freight capacity. What is the ongoing impact of COVID-19 for pharmaceutical clinical trials in the What we are seeing is the clinical trials already in progress prior to the pandemic? pharmaceutical industry? reagents being shipped from “The global pandemic is set to have ongoing and far-reaching “In a bid to combat COVID-19, Asia to countries who are then repercussions on the pharmaceuticals market this year and we’ve seen clinical trials started applying their own labs and beyond. globally. Those trials are in-region manufacturing bases “While everyone is talking about the clinical trials associated associated with antivirals which to produce those kits with the with COVID-19, I am particularly concerned about the impact on are mainly pre-existing products reagents. existing trials with patients dropping out. The FDA does seem to being evaluated to see if they “Those reagents need to be have moved quite quickly to revise its guidance, which gives have any effi cacy in helping the transported in frozen some credibility that the impact on clinical trials must be a real patient fi ght COVID-19. shipments. There are a couple issue. Although it will take time until we have visibility of it “Antivirals are boosting of options there – one is to use through the FDA, there is no clear answer at the moment. clinical trials now, vaccines will low grade packaging that is “There are unintended consequences, which could be quite precipitate mega trials down the basically cardboard, polystyrene severe for people whose lives might have been dependent on the line and test kits need to be and dry ice. However, there is a positive outcome of some of the in-progress trials.” shipped today. limit to how much dry ice you “There is immediate demand can put on an aircraft without How will the COVID-19 pandemic change the pharmaceuticals to ship frozen reagents. There risking the asphyxiation of the market over 2020 and 2021 - and will there be positives? are phase 3 clinical trials for air crew. “I think the challenge from a commercial standpoint is how its antivirals, which have started, “While that may be one of supply chain adapts through the rest of the year and through and there are mega trials the cheapest ways to transport 2021, including how it adapts to the lower air cargo capacities anticipated once vaccines get to from a packaging perspective, that will be available in the market. phase 3 clinical trials. this further limits the capacity “It will be interesting to see what the air cargo economics look “As COVID-19 is truly global, and the next options are then like as a result of the reduced capacity and whether that might we would expect the recruited to use phase change material drive pharma shippers into other modes or means. population in those trials to be with vacuum insulation. We “It could be that, for example, you can ship fi nished product, refl ective of almost all ethnicities are seeing signifi cant demand that’s packaged and labelled, but that generally has a lower and due to the indiscriminate for our rental products in the volume of actual product for the overall volume shipped. nature of the virus, across all age frozen confi guration to support “Whereas if you ship the product in bulk and use in-country ranges as well. that requirement. Those rental or regional fi ll and seal labelling and packaging contractors, you “They need to fi nd the products have been have basically reduced the overall volume of drug product that is science fi rst. In prior pandemics repositioned to South Korea being shipped by airfreight. there was talk about fi ve-year and are being used to transport “There are pharmaceutical contract manufacturers around the lead times to vaccines and the the reagents around the world.” world and risk management and business continuity might cause publicity around some of the some pharmaceutical shippers to use in-country or in-region most promising sources of contract manufacturers rather than their own facilities to vaccine development today are eliminate air freight completely. But those changes take time to talking about improvements on implement, so we won’t see that happening immediately. that fi ve years to the region of “As a result, it is probably a good time to be a contract fi ll, seal two years.” and labelling entity, as well as a contract manufacturer. “There are a number of established rental container companies How has the need for testing operating in the sector. Often their business models are based kits and reagents changed in heavily on partnerships with airlines that utilise the free space on the light of COVID-19? aircraft for the global network balancing or repositioning of their “The other part of COVID-19 containers around the world. Much of that free space is rarer, medical products has been with less airfreight capacity during the pandemic, so those associated with test kits, ranging models will face challenges to operate as they did in 2019. from fi nished product test kits to I think we will “Whereas having a global programme that uses a combination the reagents necessary to end up with leaner of sea freight, rail and road services for network balancing to produce test kits in country. The repositioning containers eliminates the dependence on airline standout country in terms of fl eets with smaller, partnerships. That modal fl exibility will be a boon, especially as high-quality reagent production more fuel effi cient the industry now faces reduced cargo capacity. is South Korea. “It is going to be an interesting time for those established “While fi nished products test aircraft container rental companies to see how they adapt to the reduced kits could be made, they are Dominic Hyde, President, capacity and how they try and address their repositioning and much bulkier and there isn’t Crēdo on Demand at Peli BioThermal network balancing capabilities.” www.airlogisticsinternational.com June 2020 33 CARGO CARGO CRIME

rime pays. technologies deployed at major At least that seems to logistics facilities, which are Cbe the case when it often certifi ed by our TAPA comes to misappropriating Facility Security Requirements cargo, which is positively industry standard, as well as booming as an illegal activity. the high number of people In terms of cargo crime in the working in these operations, Europe, Middle East & Africa means fewer than 5% of cargo (EMEA) region, two things are crimes are now what we record very clear: the growth of as Theft from Facility. incidents is accelerating, while Cargo on board a truck is there remains a severe lack of seen by the criminal as a far information sharing on the easier target; and attacks on majority of cargo crimes drivers can be extremely known to be taking place violent or threatening. across the region. The TAPA Incident Rich Targeting the load Information Service (IIS) By far the most common types Annual Report only carries of cargo crime have involved details of cargo thefts notifi ed offenders cutting holes in to the Association. In 2019, the tarpaulin sides of trucks this data consisted of 8,548 pickings or breaking open the rear incidents, a rise of 114.7% over door locks and security seals 2018, and the highest total Here, Thorsten Neumann, President & to access the goods inside. recorded in the region in CEO of TAPA EMEA, brings Air Logistics Helping to facilitate these TAPA’s 23 year history. Only crimes is the severe lack of 39.1% of these incident reports International up to date on the less secure parking sites for trucks, disclosed any fi nancial data particularly in Europe; so when but the combined value of savoury side of the freight business. drivers need to take mandatory these crimes alone was over rest breaks, they are often left €137m. During the year, we with no option but to park in recorded criminal attacks on Topping the list was the value of €2.3m was taken lay-bys, at motorway service all modes of transport: air jewellery and precious metals from a transit truck in stations or on industrial estates, cargo, ocean freight, road that were stolen from an Calabria, Italy, while €2.1m where they regularly fall victim freight and rail freight were all Origin Facility in Gauteng was appropriated in various to attack. Often, we see a very targeted, with the average province, South Africa: this goods from an Origin Facility high number of attacks on value of major crimes (those was put at €17.4m. Elsewhere, in Dubai. The list goes on… vehicles at a single location with a value of €100,000 or a €10m shipment of cash was Perfume valued at €1.9m taken during the night. At one site in more) rising substantially stolen from the cargo hold of in Oxford, the UK, which also Europe in November last year, year-on-year to reach an aircraft at Albania’s Tirana saw sports equipment worth some 74 trucks were targeted €536,889. airport, whilst clothing to the €1.4m stolen from a trailer at a within a few hours. These cargo thefts were value of €5m was taken from a motorway service area in Kent. The criminal modus recorded across 48 countries in truck in Helmond in the Computers and laptops, operandum within the EMEA the EMEA region while the Netherlands. electronic goods, vehicles and region is varied. There is the daily loss for all crimes Around €3.4m in cash was even toys all feature in the so-called ‘blue light’ operation, reported to TAPA with a value removed from a transit vehicle seven digit theft list: criminals where thieves pose as police or was €367,724. in Aubervilliers, France, and a are organised and they know traffi c offi cers in order to bring €3m loss was recorded in what they are looking for. trucks to a stop. This is a Seven fi gure losses Amsterdam, when phones, The fact is, by far the particularly regular tactic in Cargo stolen is as varied as the drones, cameras and other greatest risk to goods moving South Africa, but we have also location, but for heists over high-tech equipment were in supply chains is when they recorded similar incidents in €1m in value, there follows the removed from an Aviation are on the road. The high other parts of the region.

richest hauls in 2019. Transportation facility. Cash to levels of security systems and Then there is the use of GPS sasun Bughdaryan/stock.adobe.com

34 June 2020 www.airlogisticsinternational.com THE TOP TEN Ten countries accounted for 94.6% of the cargo crimes reported in EMEA in 2019. These were Germany, France, the UK, Holland, Sweden, Spain, Russia, Italy, Belgium and South Africa.

jammers: thieves use these to faulty while they are en route. trust in the resilience of the block tracking signals once This effectively buys them supplier’s transport operation. they take control of a truck. time; and while the vehicle is In a worst case scenario, the Otherwise a thief can pose as supposedly being repaired, loss of a single truckload of an innocent member of the they then disappear with the goods might be the catalyst for public; they often pull cargo. a change of supplier and the alongside trucks to tell the On other occasions, removal of a contract which is driver there is a fault with their legitimate drivers delivering a vital to a transport operator’s vehicle, which then results in load will be contacted en route fi nancial sustainability. the driver pulling over to by a person claiming to be We are helping our investigate and subsequently from the buyer, seller or members’ supply chain being intercepted by a group of transporter of the goods. The resilience by giving them thieves. driver will then be told that Fraud and intelligence relating to cargo Fraud and deception is a the delivery address has been deception is a thefts so they know when, fast-growing problem, too: this changed. Again, once the where and how cargo criminals involves bogus transport delivery is completed, the fast-growing are operating and the types of companies, drivers with fake goods cannot be traced. goods that they are targeting. ID or falsifi ed documentation. Online freight exchanges problem, too The TAPA IIS database helps Often entire loads are driven have also been used by Thorsten Neumann, CEO, TAPA them to also see crime trends away and disappear because of criminals to gain access to on specifi c transport routes to a lack of due diligence before cargo loads. Sometimes, determine the level of risk. they are despatched. criminals using a bogus We are also providing an Sometimes, after a load has company identity will make a long enough for thieves to online securing parking tool been collected (particularly in low bid for a load in order to steal the cargo from their that enables companies to countries like Russia where secure the booking - and will vehicle. determine safe parking journey times can be extremely then outsource it to a However, arising out of the locations along the routes they long) drivers will notify legitimate transport company popularity of e-commerce are operating and we are companies that their vehicle is to collect the goods. perhaps, one of the biggest developing our new Parking Once they have done so, growth trends currently is the Security Requirements to the offenders redirect the rise in the number of attacks increase the number of secure ABOUT TAPA goods to wherever they want on Last Mile deliveries. These truck parking places in EMEA. them to go. Similarly, offenders often occur while vehicles are We currently have well over The Transported Asset Protection have been known to offer low moving slowly in heavy traffi c 5,000 parking places in our Association (TAPA) is a leading cost capacity on empty or in other busy, heavily database, spread around ten Security Expert Network for everyone vehicles which are often populated areas. countries. TAPA advocates in the supply chain. With a global travelling to or from remote proven supply chain security membership of major manufacturers, areas like the Russian Far East TAPA’s action plans standards for facilities and logistics service providers, law on a ‘fi shing’ exercise to see if The fi rst thing to point out trucking operations, together enforcement agencies, insurers and they can attract a load. is that most of the crimes with training to implement its other stakeholders, the Association’s Unfortunately, they frequently recorded in our IIS database do Security Standards. It also aim is to help its members minimise do succeed. not involve TAPA members. offers cargo crime alerts, their supply chain losses and to In both France and Italy Our members’ supply chains podcasts, webinars, a monthly deliver industry standards, incident roadblocks are often used to are highly resilient, thanks e-magazine and conferences, intelligence, training and networking stop trucks. Criminals also to their own in-house supply so that cargo movers can learn opportunities to help companies know that some loaded trucks chain security programmes and more about the latest cargo increase the resilience of their supply are left parked up over the the benefi ts they gain from our crime trends and the best chains, manage risk and optimise their weekend and will often trawl Association. security solutions. loss prevention programmes. TAPA known parking sites to target TAPA members are the fi rst Finally, TAPA is also also represents its members before vehicles. to recognise that, often, it is working closely with government ministries as well as other Some drivers have even not the value of the stolen government ministries and law organisations, including the European been the victims of gas attacks goods that leads to broken enforcement agencies in Commission, the United Nations, NATO, while sleeping in their cabs. customer/supplier support of all of these INTERPOL and Europol. The gas incapacitates them relationships, it is the loss of initiatives. www.airlogisticsinternational.com June 2020 35 14th AsianGHI Conference NEW DATES ANNOUNCED

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Because of this previous experience he brought a useful amount of background knowledge to the marketplace – or more specifi cally, the opportunities presented by a digitalised online cargo platform. And whilst Cervera would be the last to hint that the current coronavirus outbreak has contributed to greater interest in the digitalisation process, he nonetheless makes a strong case for the virus pushing the cargo sector down new avenues. “As we know, the cargo The mother of sector is in many ways still living in the 1970s. Things haven’t changed much at all and the industry hasn’t turned itself around. Lots of processes are still manual: they are slow, they’re opaque and they are not necessarily very precise. invention “But that said, over the last Has necessity caused the scales to drop from the eyes of the 18 months there has been sector’s players? The Editor talked to Camilo Garcia Cervera, of movement, for carriers, shippers and forwarders; and Freightos, about light at the end of the tunnel. whilst I wouldn’t claim that the virus is the reason, clearly arch 2020: whether this cancelling fl ights and an this has had an effect. People particular month will upsurge in demand for cargo are beginning to realise the Mgo down as an infamous capacity, to the point that advantages that digitalisation one in the annals of aviation passenger aircraft were being can bring to the supply chain.” history remains to be seen. It pressed into service to try and Readers who might be was a period of time that saw feed the marketplace. sceptical at this point need the coronavirus claim yet more Quixotically, there were simply reassurance: this may come victims while several countries, not enough bellies or freighters with the fact that Freightos in including Italy, Spain, India available, and so the cost of March recorded the highest and the UK, entered a transportation climbed. A ever number of new clients in lockdown stage. More than vicious circle, to put it mildly. the space of just a week. At the that, the US government was But amidst all this doom and time of the interview, some also trying to dissuade people gloom there was one crumb of 1,900 customers were making from socialising, as the ravages comfort, a crumb that was People are use of the digital platform; but of COVID-19 spread inexorably only noticed by a relatively beginning to realise that is not the whole story, for around the various states. (In a small number of players within many of that number operate curious twist, it was also the the sector. the advantages that on multiple sites. Moreover, month that saw President actual deployment of the Trump declare that he Background knowledge digitalisation can digital solution can be effected expected the country to be Global VP Business bring to the supply overnight, assuming that the back on its feet by Easter…) Development, Cervera joined recipient has the necessary IT Set against this backdrop Freightos after almost two chain infrastructure in place: a long,

stock.adobe.com was the bleak news of carriers decades of working at IAG. Camilo Garcia Cervera, Freightos laborious cut-over is not

www.airlogisticsinternational.com June 2020 37 Freightos solution is highly scalable, from a one-man operation upwards DIGITALISATION

something to worry about in it’s a fraction of the cost of a this instance. full-blown IT solution. We’ve seen an attractive rate of return Doing things differently on the investment, too: and “We can do things differently,” we can accommodate stresses Cervera. “Yes, people everything, from a one-man are still needed, but why not band to a multiple operation. let the technology do all the “What we sell is change: hard work? This frees up staff and change, as we all know, is for other tasks. The old way of very diffi cult for a human doing things, one that involves the time. It’s totally But what of the traditional being to accept. But some, I’m a forwarder calling up a dozen transparent: real time means wrinkle, that of the forwarder happy to say, are seeing the numbers to get a quote, then that there is no unnecessary unhappy to invest in value in it.” cutting these back to the best delay.” technology for which he sees Could, then, the one, then calling again only to Cervera relates that he is little benefi t? coronavirus actually be an fi nd that the capacity is no seeing this acceleration of “This is not really an unwitting catalyst in all this? longer available or is more business methodology around argument. We are able to make Or is it more a case of every expensive, is time-consuming. the world, not just in Europe. available a very basic package cloud having a silver lining? By going digital, everything “We’re a global business, and that costs nothing,” assures Either way, it seems that can be seen online and a we’re working globally,” he Cervera. “Certainly, to add to digitalisation is fi nally decision made in a fraction of asserts. this requires expenditure – but beginning to gather pace…

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