www.airlogisticsinternational.com August 2020

CARGO SCANNING 11 Southwest success MACHINE LEARNING 16 Forecast looking good DIGITAL PROGRESS Update on sector adoption

AUGUST 2020 • AIR LOGISTICS INTERNATIONAL 20 POST COVID-19 30 Just what will the future hold? Joining up the dots LATAM Cargo profile

Connecting the air cargo community

ISSUE 4 / VOLUME 3 AUGUST 2020 CONTENTS

12 16

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 26 30 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 Matt East & Beth Poole

Air Logistics International is published in February, April, June, August, October & 5 Editor’s welcome 16 Machine learning December. Subscription rate per year applies to UK and overseas: Sanitisation: should we be washing our American Airlines’ cargo operations Qualifying subscription: £64 or ¤92 or US$100 Non-industry subscription: £170 or ¤240 or hands of it? reach a new high, notes Alwyn Brice US$250 7 Logistics update 18 Cargo data CDM for a better ground operation; Input from two industry sources: can Rhenus in strategic move; and an their findings help the sector predict? extended app from Nallian 20 Digital progress www.markallengroup.com 10 Cargo carrier focus A cross-section of the cargo The Editor interviews LATAM Cargo on community offer opinions - and advice Published by MA Business a Mark Allen Group Company the months leading up to the pandemic Hawley Mill, Hawley Road, Dartford, 25 Freight strategy Kent DA2 7TJ. Tel: 01322 221144 11 Cargo scanning Matt East of GHD considers COVID-19 in CHIEF OPERATING OFFICER MARK ALLEN GROUP Southwest’s low-tech idea has brought the light of a catalyst Jon Benson tel: +44 1322 221144 it many benefits. Alwyn Brice reports e-mail: [email protected] 26 Environmental update © 2020. All rights reserved. No part of Air Logistics International may be reproduced or transmitted in any form, by 12 Charter update Is the sector moving towards a greener any means, electronic or mechanical, including photocopying, As COVID-19’s grip has embraced the recording or any information storage or retrieval ­system, without future? The Editor thinks so permission in writing from the Publisher. world, so the charters have been in The views expressed do not necessarily represent those of the editor or the Air Logistics International. Advertisements in the great demand. The Editor looks back journal do not imply endorsement of the products or services 30 Post COVID-19 advertised. Cargo authorities look at what may lie Front cover courtesy of LATAM Cargo 15 E-commerce Print - ISSN 2633-2450 in store once the pandemic subsides Online - ISSN 2633-2469 Beth Poole of Ti believes that there has been a dynamic shift in the Printed by Pensord Press Ltd, NP122YA marketplace, as online sales take over 34 Cargo loader focus from the high street Alwyn Brice profiles CIMC Air Marrel

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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 Sanitisation T future? being interpretedasanillomen. the station.Theincidentwaskeptfromflight members forfearofit considered raciallyoffensive,wasaccidentallyrunover andkilledat strength. Thatsameevening,theLabrador, whosename isnow Eder damsinGermanyanefforttocripplethatcountry’s industrial lives weretypicallymeasuredintermsofsortienumbers. provided distractionattheairbaseduringatimewhenyoungpilots’ muchoneofthegroupand accounts,itwasvery contemporary belonged toGuyGibson,617Squadron’s Wing Commander. By in 1943,andreplaceitwithanother, rewordedversion. Scampton intheUKtoremoveheadstoneofadogthatdiedthere onasiftherewerenoviralthreat. ignore suchmedicaladvice,andcarry of instanceswherecertainsectionssociety, whoclearlyknowbetter, will returntothisbeleagueredsector, aswellothers.Yet dailyIread safety measures(likemasks)withoutquestion.Thatway, confidence need fortheworld’s populationtofollow medicalguidanceandadopt they rotate.Butit’s notjustaboutsanitising aircraft: thereisabroader Likewise, cargoaircraft aresubjecttothoroughcleaningmeasuresas preparingapassengeraircraft history: nowrequiresanhourormore. Alwyn Brice,Editor Or, perhaps,should webelearningfromitinordertoforgethe All ofwhichraisesthequestion:shouldwebesanitising thepast? On May16,1943,GibsonledthesquadrontoattackMohneand The doginquestionwasablackLabrador, theflightmascotthat I readearlierthismonthofthedecisionbyauthoritiesatRAF However, sanitisinghasextendedbeyondthepresent. COVID-19. The days of the 25 minute turnaround are already COVID-19. Thedaysofthe25minuteturnaroundarealready he Swordhasbeendoingtheroundsforsomeweeksnow. Sanitising has become a mainstream word in the wake of Sanitising hasbecomeamainstreamwordinthewakeof August 2020

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RHENUS’ Streamlining ground STRATEGIC operations RELOCATION s the air logistics industry struggles normally the agent loses control of the goods On May 11, Rhenus Air & Ocean back to resume its vital role, there is a once they leave the warehouse. The data moved from Herstal, in Belgium, Agreater than ever need to reduce costs can be shared to international airports and to its new location some 20 and for more transparency and effi ciency in handlers, thus helping to predict and track kilometres away at Liège airport. all aspects of the supply chain process. This the complete cargo process accurately.” The reason behind the move has is especially true of ground operations, where Congestion at large airports has become been that of the strategically cargo can often be delayed unnecessarily, a major cause of delays, increasing pollution advantageous position in the so- thereby creating expensive and unacceptable and cost. called Golden Triangle that links delays. The recent pandemic has thrown a “This problem of congestion on the Amsterdam, Frankfurt and Paris. new light on air cargo operations and the forecourt is frequently discussed, one At the new branch, Rhenus Air & need for more effi ciency and digitisation. possibility being that of not allowing Ocean plans to offer multi-modal To deal with this pressing need for better trucks to enter the handling agent’s site solutions and expand Rhenus’ solutions, a recently launched innovative before registration and approval has been global airfreight network. collaborative decision making (CDM) completed. The message that the cargo is Handling more than 900,000 trucking platform offers transparency, ready for loading and the assigned door tonnes of transported goods a predictability and a slot allocation planning number can be received by drivers via the year, Liège is Belgium’s largest mechanism to streamline the loading CDM platform. Not only does this improve freight airport and the fastest and unloading process between trucking the fl uidity on the site, but the truck growing cargo airport in Europe. companies and handling agents. Handling driver can follow instructions without the A multitude of large airlines and agents can allocate timeslots and door intervention of the company’s management.” charters, like Qatar Airways, numbers and anticipate through real time The project has been launched initially in AirBridgeCargo and Ethiopian ETA update times from trucking companies’ the Netherlands with a view to expanding it Airlines, use Liège as their drivers, thus ensuring optimal effi ciency throughout Europe and beyond. Participating European hub and link it with and avoiding long delays. Raoul Paul, CEO pilot partners include AirBridge Cargo, numerous regions worldwide. and founder of CargoHub’s Trucking CDM Menzies World Cargo, Swissport, dnata, Jan “In addition to attractive platform, explains the thinking. de Rijk, Fast Forward Freight, supported by fl ight schedules, Liège airport “The main advantage of the CDM Air Cargo Netherlands. has excellent multi-modal platform is to share relevant connections, which will enable data and information between us to offer our customers more all stakeholders involved in the air and rail freight products in truck movement, enabling them addition to sea freight products in to make the best decisions to the future,” Frank Roderkerk, CEO avoid delays. This is especially of Rhenus Air & Ocean Northern important as it allows the Europe, notes. “Several trains a handlers to allocate slots and week connect Liège with China for trucking companies to along the land bridge, including manage their drivers’ movement Yiwu and Zhengzhou.” schedules effi ciently and For the future, Rhenus Air & thus eliminate unnecessary Ocean Liège will offer its clients waiting. This also gives the air, ocean, rail and project airlines accurate information transports and Europewide for informing their customers distribution of goods, as well as about the progress of any organise customs clearance and individual shipment. Even fi scal representation. Rhenus also after loading, by using the offers the storage of goods within platform, the handling agent the Rhenus Belgium network in can continue to track the the ports of Genk, Antwerp and shipment in real time, whereas Brussels, as well as at Brucargo.

www.airlogisticsinternational.com August 2020 7 APPOINTMENTS As part of a strengthening of its team in Shanghai, the Shanghai Renaissance International Transportation Company (RENSHA) – which is part of the Hong Kong-based U-Freight Group – has promoted Lily Tao to Vice General Manager. LOGISTICS UPDATE Accreditation for Conroute Logistics

ix years after Conroute Air & Sea, one priority, both for our own subsidiaries the exclusive Swedish partner of the and for our exclusive partner network SU-Freight Group, was certifi ed by the around the world. Authorised economic Swedish Customs authority as an Authorised operators in the EU, such as our Dutch Economic Operator, its sister company subsidiary, and Swedish, Spanish and German Conroute Logistics has achieved its own partners, will receive benefi ts when trading AEO-F accreditation. internationally.” KEEPING AGILE Eva Westling, Branch Manager at The AEO scheme is one of a series of Agility Spain has moved into a Stockholm-Arlanda, who played a key role measures being co-ordinated by the World state-of-the-art, 11,000 square metre in Conroute Logistics’ accreditation process, Customs Organisation as part of a multi- warehouse and offi ce facility at ZAL commented: “We will see tangible benefi ts of layered approach to facilitating trade whilst Port (Prat) in the Port of Barcelona. AEO accreditation, including fewer physical making supply chains more secure and The facility was built by CILSA, and documentary examinations of cargo, controlled. the company that manages Port priority use of non-intrusive inspection In adopting the AEO regime, the EU is of Barcelona’s Logistics Zone, techniques when examination is required, aligning with similar measures introduced by and is part of more than 270,000 priority processing by Customs whenever other countries, including the US and Japan. square metres of projects under security is heightened and Preferred Trader The scheme provides legitimate businesses development by CILSA. eligibility.” with a quality mark, which will demonstrate The new Agility Spain warehouse Simon Wong, CEO of UFL added: “For that their internal controls, staff training and is equipped with state-of-the-art UFL, supply chain security remains a number procedures are effective and compliant. technology for logistics. Construction followed the strictest criteria for energy effi ciency and sustainability, with a goal of receiving LEED Gold certifi cation from the US Green Building Council. The offi ce block has been adapted to allow full access for the disabled. Features of the warehouse include a free height of 11 metres in the storage area and a deck roof built on site. The plot is equipped with 56 private parking spaces distributed in two areas and 25 loading gates with automatic sectional doors and external shelters. This new building addresses the current needs and planned growth of Agility Spain, which offers a complete range of logistics, multi- modal transport and distribution services for industrial, service and retail companies operating in the country. The company operates 25,000 square metres of space in Spain for storage and distribution with fl exible designs that improve the level of service and reduce costs for customers. Left to right: Johan Hagman, Financial Director and Joakim Hagman, Sales Director of the Conroute Group

8 August 2020 www.airlogisticsinternational.com Tao started her career in the freight Logistics provider GEODIS has Sub-Regional Managing Director, ASEAN. industry as an operations executive with announced the appointment of Tomy RENSHA in 1995, and was promoted to lead Sofhian as the Managing Director of Volker Dunkake, who has been with ATC since the company’s operations team just three Indonesia from May 2020. Sofhian 2014, has been made Group Manager Charter and years later. will report to Rene Bach-Larsen, Solutions.

IN BRIEF Road feeder app aids Because of an ongoing dispute with Alaska Central Express, which uses the ACE acronym, Liège-based cargo airline ACE Belgium Freighters airport co-ordination has changed its name to that of Nallian has extended its Landside arrival times and communication with used by handlers WFS and Aviapartner Challenge Airlines. Management Suite for airports with drivers on the road. and by trucking companies H Essers, the Road Feeder Management app, Following recent successful Ninatrans and Jan De Rijk Logistics: The forwarder, Maurice Ward empowering trucking companies and testing, in a fi rst phase the app was this got underway in July. Group, which has a presence across ground handlers to co-ordinate Europe, has expanded its network airport-to-airport pick-ups and by opening a new office in Antwerp, deliveries. Belgium. The application is an extension The new facility will be led by branch to Nallian’s proven Slot Booking app office manager Nancy Verstraeten, and is integrated with Be-Mobile’s who is new to the Maurice Ward Group mobile app for truck drivers, team. Truckmeister. The Road Feeder Management app enables Amazon has announced shipping trucking companies providing services to sellers in the UK, offering Road Feeder Services and their premium shipping services at associated ground handlers to competitive prices. A seven-day- also enjoy the benefi ts of Slot a-week service is mooted on the Booking, such as zero waiting company’s website and the global time and accurate planning of e-tailer is not restricting the service resources; it also facilitates to Amazon orders. co-ordination through real-time A shipping carrier that is also a updates of the estimated shipper gives an insight into where Amazon is now heading. Circumventing COVID-19 ecause of the growing demand expand coverage, namely Miami, Santiago for international pharmaceutical and Buenos Aires, as well as a second Btransportation to Latin America in entry point in Sao Paulo. the midst of the current crisis, LATAM The recently launched transit stations Cargo has extended its PHARMA provide access to Puerto Rico, New coverage. This care option, which is CEIV Zealand, Ecuador and Paraguay and Pharma certifi ed, is part of the company’s allow LATAM Cargo to offer more routes. product portfolio and offers specialised This way, the company strengthens its transportation for these sensitive and coverage and provides its clients with delicate shipments. more alternatives. The pandemic that is currently Other strategies have also been affecting Latin America has triggered throughout the crisis period. deployed. One of them includes closed-border policies and passenger fl ight One of the most important complementing the capacity offered restrictions worldwide. This in turn has modifi cations has been that of the in freighter fl ights by using passenger led the Latin American carrier to adopt expansion of PHARMA’s network in order aircraft bellies exclusively for cargo various measures to modify its itinerary to satisfy its clients’ growing interest in transportation. Additionally, and and strengthen its operation in order to transporting products from Europe to in response to clients’ requests, the mitigate the effects on its clients. The more Latin American markets. During company has provided transportation to reactions have actually allowed LATAM the last three months, the company has destinations that were not originally part Cargo to maintain a constant service implemented four transit stations to of the PHARMA network.

www.airlogisticsinternational.com August 2020 9 In 2019, LATAM Cargo’s load factor grew by

CARGO CARGO CARRIER FOCUS 0.3% despite a 1.6% decrease in tonnage

s this report was being the Net Promoter Score metric written, the outlook and our progress was mainly A for Latin America was driven by improvements in indeed a bleak one. Data internal processes and our supplier Focus Economics efforts to come even closer to declared that the ongoing our clients.” pandemic was set to push Happily, LATAM Cargo was the region into its deepest not affected by the US trade recession in modern history war with China, although the this year; and despite the carrier noted the uncertainties fact that regional inflation occasioned by this acrimonious figures fell in the early part dispute. of the year, nonetheless the During 2019, LATAM continent was in for a tough Cargo increased its fleet after few months. But was 2019, in receiving two converted those balmy pre-COVID-19 freighters in July and days, a year to remember? December as part of an agreement signed with Boeing A key player towards the end of 2017. One of the most important Furthermore, LATAM Airlines players in the region is that Brazil added 14 A320-200 of LATAM Cargo. ALI asked aircraft to its fleet for domestic the carrier about networks, its LULL BEFORE utilisation, mainly operating in routes and its commodities: Sao Paulo and Rio de Janeiro’s how had the carrier fared? airports. Additionally, as A spokesperson for the part of the agreement signed carrier said that as its clients’ THE STORM with Delta Air Lines, the strategic partner, LATAM was American airline undertook a committed to being present in The Editor profiles a Latin American carrier commitment for the purchase their relevant markets. that is still delivering the goods – and looks of ten LATAM A350 aircraft “Hence, in 2019 we from Airbus, and the sale of expanded our routes to provide back over its past year. four LATAM A350 aircraft to more and better alternatives. Delta. Specifically, we launched America and connecting to the devaluation. As for Brazil, By the end of 2019, LATAM 12 international and 14 rest of the world, while 24% this was driven both by the Airlines Group’s fleet consisted domestic routes, closing the constituted incoming cargo. execution of economic reforms of 342 aircraft, including 11 year with a robust network Transportation in domestic and a weak exchange rate. In Boeing 767F aircraft from the composed of 151 destinations markets represented 33% of addition, worldwide economic Cargo unit. (36 international and 115 activity whilst transportation uncertainty and demand “One of 2019’s main domestic) that allowed us to between countries within the volatility were factors that had challenges,” admitted the transport our clients’ products Latin American region made a negative impact on import spokesperson, “was dealing to all five continents. up the remaining 6%. markets. with imbalances in Latin “At an international level, During 2019, the company The carrier’s spokesperson American import and export the routes with the most transported 904 tonnes of continues: “Despite the markets. The Northbound cargo traffic were the ones cargo, a figure that represents complex scenario, we flows (Latin American exports) that connect South America a 1.6% decrease compared registered substantial had a good performance but to North America, and vice to the previous year. This, achievements during 2019. the imports displayed a sharp versa. In terms of products, according to the respondent, One of them was increasing decrease. Despite this, we were perishables took the lead, was caused by the decline in our load factor by 0.3%, by able to maintain high market especially salmon, flowers, South America’s main import further optimising our fleet shares by efficiently utilising asparagus and fruit.” markets, namely Argentina and our network’s utilisation. our fleet and network.” Of the total cargo and Brazil. For Argentina, Regarding our clients, we had It is, ultimately, gratifying transported by LATAM in the situation resulted from a 9% increase in satisfaction to know that business (and 2019, 37% corresponded to economic and political issues, levels in terms of the provided life) goes on during these shipments originating in Latin along with strong currency service. This is measured using highly uncertain times.

10 August 2020 www.airlogisticsinternational.com SCANNING CARGO

agents will deliver it to the departing aircraft, where it’ll be scanned. If the cargo is transferred along the way, the agent will scan it once it’s offloaded and loaded on to its next flight. And finally, the agents at the destination will scan the cargo once it is offloaded. Right now, our information is going into a database where our project team is analysing all the inputs to ensure everything is moving as manifested, as were able to quickly partner we say.” on their programme and add Was there a set length of the ability to scan cargo. trial envisaged? And what has “Late last year the the feedback been like? PIECE TIME programme began, first with “We don’t have a set The Editor finds out more about a recent passenger bags, so that our timeframe for the trial ramp agents could learn the because we want to make initiative from Southwest. system. This spring, we added sure everything is perfect the cargo functionality to the before we deliver it to our ince the fateful for of the airline. tool.” customers,” explains Russell. events of 9/11, there The idea is low-tech, if one So, leading up to the trial, “We’ve heard really positive Shave been a raft of is being honest: agents affix what was involved – and what feedback from those in procedures implemented barcoded labels on to cargo had to be put in place? our beta test programme, to ensure that the same pieces during the acceptance Russell continues: “Being including our frontline situation could never recur. process. Information is then as this was a technology employees and ramp agents.” Passengers have been subject entered into the point-of- project, we needed to set a to comprehensive vetting and sale system which marries variety of strategies, goals and The future rigid processes whilst cargo up to readings from a milestones to ensure we were Had there been any hurdles or has submitted to X-ray and handheld scanner, thereby reaching each milestone and challenges to overcome? other checks to ensure that it giving the shipper a better overcoming any obstacles. So “Since this (initiative) is safe to travel. But actually understanding about the far, we are moving along right relies heavily on technology, getting freight on to the ramp location of their product. as scheduled and feedback we want to make sure that is only one thing: how does As mentioned, this is not from everyone involved has we stay up to date with the the customer know that it has so novel: currently, most been excellent. latest. But, that’s the same made the flight? Listening to domestic airlines scan cargo “It’s a barcode-based with any technology project. that customer is what brought with barcode technology. system using handheld We’re moving right along on about the latest initiative Russell takes up the story. scanners. Once the shipment our trial and we are really from Southwest Airlines. is tendered, it’s entered in excited about the future of The scanning of passenger One big team our database. Then, our this programme.” baggage, long practised, has “At Southwest, we work as And next? been taken a step further by one big team across all of “We’re really focused on Southwest, which commenced our organisations. We knew perfecting the product and a pilot programme earlier this there was a similar effort … we are really delivering it to our customers year, in late spring. For Kevin to start scanning passenger so that they can begin Russell, Director, Commercial bags that was beginning to excited about the tracking their shipments. Planning, Cargo and Charters, take shape over the last few We know this is a big ask it was the culmination of a years. Knowing our most future of this from them but we’re looking project that had roots in 2019 requested item from our programme forward to opening it up once – and something that his cargo customers is the ability we’ve worked through all the clientele had long been asking to track their shipments, we Kevin Russell, Southwest Airlines kinks.”

www.airlogisticsinternational.com August 2020 11 CHARTER AND CHARTER FORWARDER UPDATE

Intradco Global has been busy with PPE as well as other types of cargo A charter to fly It’s been a busy few months for those and logistics specialists that it transported 13,000 cartons have been making the most of (totalling nearly 1,000 cubic whose job it is to source capacity and the pandemic. metres) of medical supplies and PPE on board the Antonov flights, writes the Editor. Adapting – and an Antonov An-225. For the past century the The world’s largest aircraft airfreight industry has arrived at Toronto Pearson his summer, IATA’s normality will not occur before shouldered a responsibility for International in June, having statisticians crunched 2021. a vital role within the global flown from Tianjin Binhai T the numbers and came Focusing on the freight economy. Keeping goods International, with fuel up with some (predictably) sector, a shortage in cargo moving is essential to the stops at Chubu Centrair bad news. Compared to 2019, capacity through the growth and development of International and Ted Stevens overall freight tonnages unavailability of belly cargo on markets and industries. Now Anchorage International. carried were expected to drop parked-up passenger aircraft more so than ever before, This recent mission is by 10.3m tonnes to settle was expected to push up rates that sense of responsibility testament to the adaptability around 51m tonnes. Airlines, by around 30% for the year. has grown into a way of life. that is so valuable right now. in total, were expected to Cargo revenues, IATA believes, Billions of people rely on the Since 1987, Intradco Global lose US$84.3bn in 2020, for a will peak at US$110.8bn this airfreight industry for vital has made a name for itself net profit margin of -20.1%. year (up, one should note, medical supplies and for PPE through chartering aircraft for Looking ahead, a notoriously from US$102.4bn in 2019). and companies have had to animal movements but now difficult operation, IATA Thus in terms of industry adapt rapidly to ensure that the company is focused on suggested that in 2021, losses revenues, cargo will contribute demand is being met. providing air cargo capacity for are expected to be cut to approximately 26%, or over A typical example has been critical PPE. US$15.8bn as revenues rise double the figures posted in that of Intradco Global, which Charlie McMullen, Intradco to around US$598bn. That 2019. in collaboration with GTA Global’s Director, commented said, there some in the sector A bright spot? Most GSM, completed a significant on the changing status quo. who believe that a return to definitely. And it’s the charter charter operation in which “Difficult times call for

12 August 2020 www.airlogisticsinternational.com adaptability, and I am proud of some passenger aircraft for The specialist Singapore and China, Europe of the Intradco Global team cargo haulage. The Chapman Freeborn group and the US. From what I’ve for adjusting our usual offering As an example, the business isn’t solely focused on picked up, it seems that most, to assist in the PPE supply DACHSER Air & Sea Logistics charter fl ight arrangement: it but not all, charter companies chain efforts. As live animal team organised an Airbus has various affi liate companies have been equally busy: some movements became very A340-600 passenger aircraft that between them offer a exceptionally so, others less. restricted, we switched our (that had been converted range of services. According to But generally, nearly all those resources to seeking out new to a cargo charter) to transport the company’s Reto Hunziker, in the sector have had a good air charter capacity while medical products from who is Group Cargo Director three months’ work. We’ve there was a surge in demand Asia to Europe. At the fi rst and based in Frankfurt, it’s operated in all the major trade for PPE. I am glad our efforts stage, fi ve trucks brought this spectrum of services that lanes and have had plenty of played a small part in the the goods from Beijing to has enabled the company to US business, both in and out. global effort, and allowed our DACHSER in Shanghai, where successfully weather the storm “We’ve been able to clients to import quickly, and DACHSER staff handled all caused by the pandemic. respond to virtually all at more cost-effective solutions the operational and customs “These strands are our requests since the pandemic than we saw the market was formalities for the export strengths in times of crisis,” he struck and indeed, it’s part of offering.” order. told ALI, in a recent interview. our philosophy to be able to He adds of the Russian From there, the goods went “There are too many variables add value for the customer. If freighter: “Chartering the to Hangzhou airport in China, in the marketplace at present, the customer cannot fi nd what magnifi cent An-225 is a where the charter aircraft was so we have to be prepared to he wants, then he turns to us rare occurrence for even the already waiting to depart for react.” – so it’s important that we can most seasoned of air freight Madrid. While 13 air freight Looking back over the come up with solutions. But professionals, so the whole pallets went into the aircraft’s spring and early summer it has been hard to fi nd that team will enjoy seeing this bird cargo hold, the remaining period of 2020, Hunziker capacity at times – there has fl ying for Intradco Global.” material was placed on to affi rms that the company has been very little spare. Tom Lamb, Intradco the cabin seats and secured, been extremely active. “It has “Initially, we were very Global’s Regional Manager – making maximum use of the been a very busy time for us – much preoccupied with North America, was equally aircraft’s capacity. The goods we’ve arranged fl ights literally medical supplies and PPE but enthused. arrived in Spain on schedule, all over the world, including by mid-year that has been “It was a fantastic team and within the planned transit effort and a great early time. DACHSER has been able to adapt its air freight charter operations to the changing market achievement for our New “Having our own Canadian offi ce Intradco North air freight charters America and our partner GSM/ meant we could react GTA. We are very proud to be quickly and fl exibly to assisting in the fi ght against the changing situation COVID-19 by delivering this in the air freight essential PPE equipment to the market right from people who need it most.” the start to help our Later this year Intradco customers maintain Global is set to announce their supply chains,” a newly formed wing of its explained Timo Stroh, organisation, that of Intradco Head of Global Air Projects. Intradco Projects Freight at DACHSER. will focus on unique missions “It’s so nice to see that just like these, utilising its our charter activities worldwide charter network and are now bearing fruit expertise to offer specialised in Spain, too. This is services for niche air cargo primarily thanks to products. the commitment and tireless efforts of our Preaching to the converted local colleagues, who Innovation in the area of the successfully organised cabin has led to the adoption this project.” www.airlogisticsinternational.com August 2020 13 CHARTER AND CHARTER FORWARDER UPDATE

changing: we started to see industry indicator, after all. ... demand simply we need to take stock. For the return of general cargo “The months of June, July my part, I’ve done a lot of requests, as well as project and August are the transition isn’t coming back conference calls, which has cargo (outsized loads and months; the third quarter quickly worked perfectly well although the like). However, although and the fourth quarter are the in this business, person to general cargo has been taking important periods and that’s Reto Hunziker, Chapman Freeborn person contact is still very the place of PPE, we are not when we will see where the important. seeing enough it; demand market is going. “And, asking around, I can simply isn’t coming back “To be honest, no-one can tell you that most customers quickly. This is all down to tell at the moment which way do not know what is coming: consumer habits, of course. things will go. Demand is less traffi c. But those charges are we’ll know more towards the With the restrictions in most at present (this remark was coming down again now more end of the year.” countries, people may decide made in June - Ed) but belly space becomes available. On that prophetic note the to stay with their existing capacity is now coming back; “At Chapman Freeborn article ends. Looking back, it phone or car or whatever so the situation has reversed. we’re used to an unpredictable is safe to say that the charters and not trade up. Retail “Freight rates have also market but nonetheless, it’s have had the lion’s share of outlets have been opening been in the news, but that’s very hard to forecast. Being good fortune, but whether but that doesn’t mean to say only to be expected when fl exible helps, as does thinking those good times will continue that people are shopping as demand is high. This has been outside the box. We’ve had a to roll for the rest of the year before. Consumer spend is the noticeable in Asia to Europe really busy period and now remains to be seen.

14 August 2020 www.airlogisticsinternational.com E-COMMERCE

Clicks and mortar he outbreak of COVID-19 Beth Poole, of Transport Intelligence, stores in China reopened around the world has following the government’s Tbrought many retailers takes a look at the effect of COVID-19 on instructions to return to to an abrupt standstill. Retail business as usual, only to supply chains have been left e-commerce. see consumers continue to in disarray, following a mass stay at home. Electronics cancellation of orders. While retailer Suning.com has stated bricks-and-mortar retailers the rise, but home and athletic website to fulfi l their shopping that some of its bricks-and- come to terms with some hard goods are also experiencing needs. When lockdown mortar stores are only seeing truths, such as that stores record-breaking sales. The measures were implemented in approximately half of its usual may not be able to fi nancially closure of bricks-and-mortar early March, the demand was customer footfall. recover from the pandemic, stores has been encouraging so great that it overwhelmed In the long run, e-retailers e-retailers are witnessing a those who are technophobes the company’s fulfi lment are still likely to benefi t from surge in sales as people turn to to learn some new skills. and delivery capabilities. In the crisis. Many bricks-and- them to fulfi l their shopping E-commerce giant Amazon response, the company went mortar stores were already needs while bricks-and-mortar has reaped the rewards of on a hiring spree, employing facing administration before stores remain closed. non-essential retail closing, as 100,000 additional members of the crisis took hold and it Even before the COVID-19, consumers have turned to its staff to help manage demand. is doubtful whether many outbreak e-commerce had Canada-based e-commerce will recover from it. Swedish been gathering pace. In 2019 platform Shopify has also retailer H&M announced plans e-commerce sales represented benefi ted from the crisis: in February 2020 to ”power the bulk of overall retail during the fi rst quarter, up” its 5,000 stores, using sales growth in the US, revenues jumped 47% to them more as logistical hubs to accounting for 56% of overall CAN$470m. The company focus more on digital growth. retail growth, according to has been assisting retailers With COVID-19 accelerating emarketer. COVID-19 simply to transition to an online the closure of the high street appears to have escalated the platform. Shopify will organise stores, it may be only a matter transition to online. According delivery to local areas on of time before other retailers to COVID-19 Commerce behalf of small shops and switch to digital solutions. Insights, US retailers restaurants. Though the experienced a year-on-year company does not yet carry Plus ça change… increase of 68% in revenue out the deliveries itself, it is Has COVID-19 changed growth in online sales in mid- developing a warehouse and anything fundamentally? April. logistics network that will No. enable it to do so. Instead, the virus has Clothing sales up simply sped up the timeline, Despite Next’s CEO Simon US retailers Short-lived demand? spurring a new generation into Wolfson stating “people However, the dramatic spike in the era of online shopping. do not buy a new outfi t to experienced a year- demand is likely to be short- The real test will come over the stay at home”, this does lived. E-commerce sales have festive period, assuming bricks- not seem to have been the on-year increase already dipped in countries and-mortar stores survive the case. Loungewear sales are of 68% in revenue where lockdown measures crisis, when we will discover seeing record-breaking sales have been lifted. That said, whether those who have numbers. In April, demand growth in online retailers should not expect previously shunned online for loungewear rocketed consumers to fl ock to bricks- shopping turn to it to carry 322% in the UK. It is not only sales in mid-April and-mortar stores in the near out the bulk of their Christmas loungewear sales that are on Beth Poole, Transport Intelligence future. Shopping malls and purchases. www.airlogisticsinternational.com August 2020 15 MACHINE MACHINE LEARNING

Whether forecast Predicting cargo transactions can pose a headache for the most able of shippers and transporters. But for American Airlines, the challenge has represented an opportunity. The Editor finds out more.

f airlines were possessed of shipments per day, it behoves the carrier to be on the ball, day in, what were the factors crystal balls, life would be a day out. After all, the bottom line here is one of cost: if a prompting this change? Ilot easier, one imagines. shipment doesn’t show up on the day of departure, there’s “With few exceptions, the Unlike passenger flights, a typically no chance of changing the layout or selling the void. industry standard has been not cargo flight is very much at the Because of this shortfall, the configuration of the freight in the to charge fees for booking whim of its freight, which hold may be less than optimal, which results in a higher fuel bill changes or cancellations, and might arrive on time – or en route. This, in short, affects the carrier’s profitability. we have traditionally followed might not. Indeed, in extreme Consequently, any help with what purports to be a seemingly that. However, late cases, cargo might be booked nightmarish task is very welcome. cancellations or no-shows are a just days before the actual Enter machine learning. huge issue for the industry, flight. In consequence, resulting in wasted cargo space anything that can be done to The quandary on many flights. Ultimately, rationalise the unknowns and Maulin Vakil recently took over the role of Managing Director this results in airlines turning improve the situation is thus Cargo Customer Care and Performance Analysis at American away many shipments which of huge benefit to a carrier. Airlines. He spoke to ALI about changes in the carrier’s day-to-day they could have otherwise And when, like American management of cargo booking. accommodated. We’re trying Airlines, that responsibility At what point did American decide that the existing system of to find a way to say “yes” to translates into thousands of bookings (and percentage failures) needed to be changed? And more customers, and to create

16 August 2020 www.airlogisticsinternational.com TECH TALK For any readers not quite up to speed with the ever-evolving world of IT, herewith some explanations.

• CPU (Central Processing Unit) – think of it as the main processor in your laptop. In a laptop, each processor may have from one to 12 (or more) cores. a process which ensures that we are able to maximise the continues to optimise, given opportunity to move critical shipments, such as the PPE, • GPU (Graphic Processing Unit) the continual evolution of the COVID-19 testing kids, medical supplies and pharma products, – usually found in a video card. It environment. which we are moving over our network today.” has thousands of small processors “In all, we used 20 data that are not as powerful as CPUs. fi elds such as weight, volume, Developing the model However, because of the sheer commodity, origin, destination “We sought to do this by developing a model which uses volume of the processors, the and so on from half a million historical data to enable us to better identify which shipments are GPU can perform many more actual bookings to calibrate likely to change or not show up, coupled with the introduction of computations at once than a CPU. our machine learning model a new Fair Booking Policy, which is designed to encourage with an open-source machine- customers to provide updated booking information as soon as it • ML – machine learning. learning package from H2O. is available, rather than updating at the point of tender, for Using the Z-by-HP data science example. • Z – type of HP workstation workstation, which had “In October 2019, American Airlines Cargo implemented designed for data science. Nvidia’s GPUs, we had iCargo, the new end-to-end technology platform that provides us calibration runs that were ten with the tools and the data to be smarter and more agile in the times faster than calibration way we develop new solutions and solve old problems. This on non-GPU machines. modernisation and technology platform now enables us to move American has said that a Basically, we are using a very our own business forward by making these sorts of changes. This year of data formed the powerful computer to process is a new way of thinking, but we believe we have the bedrock of this innovative millions of data fi elds and responsibility to protect our customers’ interests and allow them model. Going forward, will machine learning software to to utilise our capacity to the fullest extent.” that database be added to make much better decisions In terms of coming up with a solution, did American approach every month/year? which help us make better use experts outside the carrier? There were reports of in-house “Indeed, we used 12 of our capacity.” development. months of data for the initial The concept has much to “The solution was internally envisioned and prototyped at the calibration. As more data commend it, without a doubt enterprise-wide hackathon event in 2019. Every year American becomes available, we will – but is American following a Airlines holds a hackathon event called Hackwars, where 1,000 continue to incorporate this trend or is it trailblazing? innovation-minded team members and over 50 technology with our model to ensure that “We are not aware of partners spend 24 hours designing and creating solutions to the decision-making process anyone else using this various challenges. At last year’s event, we discussed this issue technology. However, no- and potential solutions with several outside experts, but shows and late cancellations eventually ended up partnering with internal IT and Operations are an issue for the entire cargo Research & Advanced Analytics (ORAA) departments to build the industry. Machine learning solution in-house. At the time, they were testing a graphics models are a great way to processing unit (GPU) workstation from Nvidia. The model ORAA obtain and utilise data you developed uses features derived from text fi elds in the cargo need to implement changes booking and the GPUs had enough computing power to calibrate like these to an existing that model.” business model. “We expected the system to Details of the process pay for itself in a few months, How long did this changeover take? Were many people involved? based on 2019 numbers. The And cutting over to the new system: did that present any COVID-19 pandemic and the challenges to American? resulting large schedule “It took a few weeks and a team of nine people to develop the reductions at the airline have system that predicts whether freight will be tendered or not and impacted the payback timeline proactively contacts the customers involved. In parallel, on May slightly. At the same time, 1, 2020, we implemented the Fair Booking Policy to ensure that We’re trying to cargo space is now more we are better able to meet customer needs and mitigate unused fi nd a way to say limited than ever and having a space, especially when demand is critical. system that can help us utilise “This policy was formed and implemented in just two months “yes” to more this space is critical.” and was a great showcase of cross-collaboration amongst teams, Machine learning: is this, all with the same vision in mind of being able to better serve our customers then, the way ahead for the customers in the long run.” Maulin Vakil, American Airlines sector? It would seem so. www.airlogisticsinternational.com August 2020 17 MARKET MOVEMENTS Through a glass, darkly Extrapolation, they say, is only as good as the data originally from the peak in mid-May. Shippers were paying about input. With that in mind, the Editor asks whether recent US$7/kilogramme outbound from China to Europe, which statistics can show the sector much about the future. was about two and half times the rate at the start of the year, iven that this periodical 37% decline in volumes year-on-year in April, the corresponding and similar to the price in is bi-monthly, for the fi gure for May of a 31% decline revealed a slight upward curve April, data from The Air Cargo GAugust issue it would and, measured alongside a capacity decline of 42% at the same Index reveals. Three or four appear to make good sense that point last year, the pressure on capacity remained high. weeks prior, rates were double data is drawn from May to Consequently, CLIVE’s “dynamic load factor”, which is based on – or more. Rates were also early July: that way, at least, both the volume and weight perspectives of cargo fl own and easing from China to the US, some relatively recent industry capacity available, increased month-on-month from 67% to 69%. down to about US$5.75/ fi gures can be presented. Good news for the freight movers, then – but just as March kilogramme. Needless to say, there is no and April showed aberrations, so did May. March ended far worse Capacity remained very shortage of specialists in the than it started; while for April, it was the other way around. tight in many parts of the fi eld of data collection but Looking back, it becomes clear that May ended in a weaker state world because there was a what follows is correlated from than it began. After a series of week-over-week growth in volumes, dearth of passenger aircraft the fi ndings of just two. a decline set in during the week of May 18-24, followed by an operating that could offer CLIVE’s Managing Director, even stronger decline for the last week of May. During these last bellyhold space to shippers. It Niall van de Wouw, when two weeks, the capacity growth rate compared to the previous has been estimated that the looking back to May, week was higher than the volume growth, thereby reducing the industry was short of about a commented that air cargo dynamic load factor for the fi rst time in weeks by 0.5%. This quarter of the normal airlift volumes had improved easing of pressure on capacity had a downward impact on freight because airlines parked fl eets month-on-month but that a rates on major trade lanes. when the coronavirus spread, dip in the fi nal two weeks and much of the available could be considered a cause for An erratic market cargo space was targeted at concern. Global industry data “Looking at the last 12 weeks,” commented de Wouw in May, “it medical supplies for the for May supported the is clear to see that market volumes remain erratic and that this response effort. continued small recovery of air will continue for the foreseeable future. This is one of the few According to CLIVE, as PPE cargo volumes, yet that fall in certainties we have at the moment. We can see some dark clouds volumes faded, so global air demand seemed to be the gathering and this is a cause of concern for air cargo. This is why, cargo volumes in June harbinger of challenging times in navigating these uncertain times, weekly data becomes not provided the fi rst real ahead, as airlines returned only relevant to decision-making, but crucial. Knowing what is indicators of structural capacity to the market. happening each week gives the industry the clearest direction. We recovery. The industry seemed Overall, says de Wouw, the do not see signals yet that the increase in capacity is being met by to be slowly getting back up on month of May 2020 was not as growth in demand. With the announcements of increases in its feet, with volumes in the bad for the global air cargo passenger schedules, global air cargo revenues may suffer fi rst four weeks climbing 6% industry as that of April 2020. collateral damage of more capacity returning to the market.” compared with the full four As hinted in CLIVE’s data for weeks of May. April, the industry seemed to June: the turning point? Volumes in the last week of have passed the (initial) On to June, where air freight rates continued to settle on the main June were 12% higher than in bottoming out phase. After a trade lanes from China to the US and Europe, as demand softened the fi nal week of May. The apinan/stock.adobe.com

18 August 2020 www.airlogisticsinternational.com As for COVID-19, it’s important that we don’t forget but that we learn from this Camilo Garcia Cervera, Freightos

1000778_ALIN_Mercy 15/03/2019 10:54 Page 1

year-on-year performance gap Freight and Freightos “The industry has further closed, with global Camilo Garcia Cervera at Webcargo by Freightos notes that always been full of silos volumes at -25% compared during the past few months the industry has seen how rates went – we’re now seeing more with June 2019, contrasting up by up to 400% in certain trade lanes. sharing of data, which is with the -31% annual disparity “After a reasonable start to the year, capacity dried up as the a good thing. This has for May. virus established itself and it was all about transporting PPE,” he been the silver lining to Signifi cantly, perhaps, the recalls. “Freighters were full – and so passenger jets were pressed COVID-19.” last two weeks of June saw into service. But once people were satisfi ed that enough was As for infl uential factors capacity creeping up slowly being done to prepare for a second or third wave, capacity has that could well impact rates week-over-week by around started to ease.” as 2020 unfolds, he cites the 1.5% per week. Differences between requisitioned passenger aircraft and pure discovery of a vaccine – and Worth mentioning is the freighters are marked, he argues, but the former have played a the imminent US elections. fact that CLIVE’s “dynamic useful part nonetheless. “Rates are now not climbing like they The Hong Kong situation loadfactor” of 71% in June were (a comment made in July at the time of the interview) but has not gone unnoticed, (based on both the volume and the viability of the market is now more diffi cult. Passengers aren’t either. weight perspectives of cargo coming back in numbers yet, so revenues are down. As for “But most importantly, fl own and capacity available) COVID-19, it’s important that we don’t forget, but that we learn we need to have in place a recorded its highest level since from this.” contingency plan so that we CLIVE began measuring the Whilst Garcia Cervera freely admits that forecasting next are ready for a recurrence industry’s weekly performance week, let alone the next couple of months, is hard enough, he of this type of situation, in 2018. expresses enthusiasm over the progress made by digitalisation. should that ever happen.”

Cargo Equipment We buy and sell

www.airbusiness-gse.com

www.airlogisticsinternational.com August 2020 19 DIGITAL DIGITAL PROGRESS

Fahrenheit 451 Digital Cargo, is unequivocal Now, more than ever before, is the time to burn bridges – about this subject. “The most important and indeed paper, writes the Editor. tool that has allowed the air cargo community to go on igitalisation. the human race is busily engaged in finding solutions and working is, without question, This is, when one innovating to fight it. The air cargo industry is no exception. the full digitalisation of the Dthinks about it, one Airlines, freight forwarders, airports and ground handlers are workplace. The ability to of the crucial elements all playing their part in this battle. But arguably the most telework from one day to the that has helped keep the unintended assistance has come from the digital technology next, with access to all data air cargo industry afloat that enabled the industry to not only adopt social distancing resources and the effective use during the coronavirus but also to move air freight more efficiently. of team collaboration tools, disruption. If the slow pace has demonstrated the high of adoption and reluctance Challenges abound degree of digitalisation that among stakeholders to jump The air cargo community has been facing several challenges, has already taken place.” in was the talk before, the including those of reduced capacity coupled to a sudden This rather neatly sums up pandemic is surely changing demand surge (particularly for medical supplies); an absence the situation: the answer has this mindset. Indeed, digital of onsite manpower; sporadically climbing freight rates and, been under the sector’s nose service providers are reporting latterly, growing capacity linked to an actual falling-off in all along. He continues: an unprecedented interest in demand. Meanwhile, the digital solution providers have come “In January, we launched a both traffic and demand. up with new software, redesigned current platforms and on- new service, EPIC (Enhanced At the time of writing, the ground collaboration. They have reported increasing demand Partner Identification and world can be said to be in a and traffic in their platforms, while sales are being completed in Connectivity), to manage virtual state of war against record time. Has, then, the time come for cargo stakeholders to system connectivity between the COVID-19 pandemic. embrace digital solutions? air cargo stakeholders. We While the virus is posing IATA is one organisation that has been banging this assumed with COVID-19 this new challenges every day, particular drum for some time now. Its Henk Mulder, Head of new service would take a

20 August 2020 www.airlogisticsinternational.com backseat whilst the industry employees in some cases. operations into the digital deals with its operational Electronic documents would arena due to reinforced challenges. It turned out have allowed this work to need of digital solutions. that publishing contact be done remotely while For example, the certifi cate and connectivity details, teleworking,” he explains. of origin is a document and accessing those of required to move an air freight your partners, is a highly Who’s done what – and when consignment and people have important service, in In May this year Kale Logistics to physically reach out to particular when the supply Solutions introduced its PING the Chamber of Commerce chain is disrupted and needs product, a new document to get it done. But the offi ces to adapt and when digital processing solution for agents, of these chambers are not communication is fast and freight forwarders and ground working now,” he points out. safe,” he added. handlers. This welcome To emphasise the benefi ts addition to its portfolio is is easy. “The airports with our Paperchase mentality essentially one of the small next generation community The air cargo industry remains modules separated from the systems were able to operate an overwhelmingly paper- company’s bigger air cargo virtually, with very less direct based industry. Readers community system. human interaction, and in will, one fears, be all too During the lockdown effect more effi ciently. Airport aware of (and in many cases period the company entered employees were able to embarrassed by) the statistics. into agreements with two process the paper while they Anything up to 30 types of international airports to are working from home.” documents, together with implement its community Removal of the perhaps 124 copies of paper system, completed a sale unnecessarily complex steps have to be produced to effect to a charter operator in a brings benefi ts elsewhere. an air cargo shipment. But record time of just three “To move life-saving for those who have dipped a days, and was approached drugs, for example, the toe in the water have come by some major General Sales forwarder has to deal with slightly unexpected bonuses. & Service Agents. CEO Amar the customs declaration, “Electronic documents, like More explained the rationale send the air waybill to the the e-AWB, have turned out to behind the development. Electronic airline and pay handling have an unintended benefi t: “Air cargo community charges to the airport. Our the absence of the need systems are big projects which documents, like the GMAX portal has all these to physically touch paper will take time and several things articulated into a documents that have been stakeholder interactions e-AWB, have turned single platform. The impact touched by others recently. In to implement. So we have out to have an of lockdown was minimised some cases, the air cargo paper broken down the system for airports with community documentation is shipped into smaller modules to help unintended benefi t: systems. The software also separately from the cargo via different stakeholders to enables the people to process express couriers. Electronic interact digitally for separate the absence of the these requirements 24/7, documents don’t have this operations. PING is one such need to physically particularly during Saturdays issue,” stresses Mulder. module that helps GHAs and Sundays,” he adds. “Most, if not all, airlines and freight forwarders in touch paper still handle a lot of paper document processing which Henk Mulder, IATA One big digital ecosystem documents and they have has received a tremendous With the crisis comes dedicated teams that process demand from different innovation. For IT solutions these documents. Typically, geographies, including North provider IBS Software, it has they will manually verify the America, Europe and the meant looking into two levels correctness of the data and Middle East. of collaboration, namely the key in the most important “Since the lockdown, we digital players and the air aspects into their systems. have been receiving requests cargo stakeholders. This requires the physical from ground handlers, Ashok Rajan, Senior Vice presence of these teams, airlines, airports and charter President and Head, Cargo which can be up to 100 operators to transform their & Logistics Solutions, IBS www.airlogisticsinternational.com August 2020 21 DIGITAL DIGITAL PROGRESS

Software said: “We in IBS Software are trying to widen our partner ecosystem. We are partnering with digital players in the BLOCKCHAIN – AND MORE sales channel and cargo payments space to integrate and add Happily, many other promising developments are occurring within the digital realm value for the customer. Thus IBS is opening up its integration of air cargo, ranging from blockchain-based booking to the introduction of new capabilities to make sure that all these players will become one currencies to fi ntech platforms. big, ready-to-use digital ecosystem. In April 2020, AirAsia’s cargo arm, Teleport, launched Freightchain, the world’s “Ground handlers are the airline representatives. Today fi rst e-booking platform powered by blockchain. The platform helps on-demand there is a lot of manual intervention between these parties to bookings in real time through submitted bids and then validates them using make sure that the airline gets all its work done by the ground blockchain algorithms. The airline deliberately launched Freightchain within global handler. For example, even during these diffi cult times a lot of supply chains during this period of uncertainty. perishables and pharmaceuticals are moving through air cargo, Software company DAKOSY has expanded its air cargo portal INFr8 into android which requires strict temperature control. This mostly requires a and iOS mobile devices. The dashboard can now show the logistical and technical phone call or direct communication between these stakeholders milestones accomplished, as well as notifi cations that inform users about rejected to constantly monitor the temperature,” he explains. electronic dangerous goods declarations. “Our platform, Cargo Virtual Connect, has tried to make this The online freight payment tool PayCargo launched a dedicated Canadian one seamless transaction across players and systems through dollar platform in Canada in April: this has enabled users to pay either in Canadian exchanging instructions and responses digitally. In an industry or US dollars after the registration. According to the company, although the plan to where the business environment has been turned on its head introduce the Canadian dollar was actually an earlier idea, it decided to fast track it and become a supply-constrained environment, our AI/ML- because of the pandemic. enabled revenue management solution is helping airlines make In May, Air Canada and Unilode Aviation Solutions extended their ULD the best decisions on pricing and selling,” he states. management solution, which also includes digital solutions. In the near future Air While commenting on the need for airlines to work together, Canada’s cargo network will be managed by this digital solution. he adds: “Even though the freighter-only airlines are doing Finally, Portugal’s fl agship carrier, TAP Air Portugal, has entered into a exceptional business, they also have challenges, as they are partnership with air cargo e-booking platform Cargo.one, confi rming an ongoing dependent on feeder fl ights of smaller airlines that bring trend. capacity from different areas. We are therefore also working for greater co-operation between carriers through a joint venture engine, where even the smaller players could participate.”

RFID for performance It has been a similar story at Cargocast which, in April, introduced an RFID-based logistics platform for automated COVID-19 has certainly warehouse operations. reinforced the need to The fact that there has been urgent freight tendered and a embrace resilience and remain lack of capacity to move it as quickly as needed has prompted agile. More than ever it is study. Lockdowns and social distancing practices have resulted important to have transparent in a degree of diffi culty in maintaining staffi ng levels in some access to prices and capacity areas, all of which has been creating pressure on storage and available, along with the handling capacity in the warehouse. ability to book them instantly. Cargocast’s VP Advanced Cargo Solutions, Michael Morey, WebCargo by Freightos is a stresses that RFID technology has reduced signifi cantly in cost digital software company that whilst improving accuracy and performance. “Every warehouse gives access to live capacity, has specifi c pain points and other areas where best practice pricing and allows e-bookings are already implemented. We focus on the processes that can for freight forwarders with a bring the highest return on investment in each case. For some, We in IBS global presence. The company it’s ensuring the accuracy of actual manifested goods being works with 1,900 unique loaded or unloaded. In some cases, the focus is on managing the Software are trying freight forwarders and more consolidation of shipments.” than 10,000 branches around to widen our partner the world. While WebCargo Pricing, capacity and e-booking ecosystem already has 14 airlines on Looked at critically, it’s true to say that digitalisation didn’t its platform, the company Ashok Rajan, IBS Software come about this spring. The idea started gaining ground a expects 11 more to join by the few years ago, while the last couple of years have seen bigger end of this year. In the wake steps and quicker progress in this direction, even though the of this crisis, the company cargo sector has been slow to clamber aboard the bandwagon. gave free access for all IATA

22 August 2020 www.airlogisticsinternational.com accredited freight forwarders “Changing logistics processes and tracking systems can be to its eBooking platform (see a signifi cant project for a company. There are many solutions Air Logistics International available, but the challenge is fi nding the right solution. The June 2020 for an update from reality is paper-free solutions could be implemented without Camilo Garcia Cervera). much downtime and provide signifi cant effi ciencies to cargo Cervera, Global VP operations, and in the long term show a true return on Business Development, investment in both time and money. WebCargo, views the situation “Since COVID-19, the market has been focused on new as a perfect storm. processes that reduce or eliminate touching similar surfaces and “We have seen changes promoting social distancing. Establishing paper-free solutions in capacity and fl uctuations can do both; eliminate the need for touching common paper in prices. Altogether these surfaces and promote greater social distancing. changes demanded digital “Through our Productivity Products business, Honeywell solutions for this industry More than ever has created several new software solutions designed to help to move forward. Reduced companies enforce COVID-19 site health and safety procedures. capacity and increased in history, airlines These features monitor on-site social distancing compliance, demand took the prices to and forwarders are help enforce customisable device cleaning procedures and record levels. It has become deploy software to digitally trace who has handled a mobile important for the forwarders opening their doors device. to understand the pricing in a “The features provide employees and managers with real- very lively manner. We don’t for digitisation time data to better respond to critical factors for businesses establish prices. Instead, we Camilo Garcia Cervera, WebCargo re-opening under modifi ed conditions due to rapidly evolving distribute the prices and make health and safety guidelines.” sure they are live. This isn’t exclusively due to COVID-19, Seismic shift but the pandemic has What did she feel was required to bring change (ie digitalisation) accelerated this move. to the sector? “More than ever in history, “With a seismic shift in consumer demand due to the airlines and forwarders are opening their doors for digitisation. It is no longer acceptable to have a business plan in this industry which doesn’t have a digital strategy at the heart of what someone is doing. We are already very strong in Europe and are trying to reinforce our presence here. Asia, led by India, is witnessing very signifi cant and quick growth. The Americas is also another place we could see growth coming in,” he concludes.

The technology question If the cargo sector has been slow to gear up for a paper- free solution to its transaction business, what do the IT providers say? Amanda King is the Vice President & General Manager, Aerospace Connected Secure Solutions, at Honeywell. www.airlogisticsinternational.com August 2020 23 DIGITAL DIGITAL PROGRESS

THE SEAMLESS AIRPORT With a vision of making Kempegowda International airport, in Bengaluru, a smart airport, Bangalore International airport is set to introduce the Air Cargo Community System to further streamline air logistics there. ACS is a digital platform that brings together all the stakeholders, including Customs, Customs brokers, shippers, airlines, trucking companies, ground and cargo handlers as well as freight forwarders, under one roof, facilitating the seamless movement of goods and data. An e-agreement was signed with Kale Logistics Solutions, which will undertake to develop the ACS platform. ACS is considered an effective business continuity tool that the airport can provide to its cargo stakeholders in what is increasingly being referred to as the New Normal in a post-pandemic era. Satyaki Raghunath, Chief Strategy & Development Offi cer at the airport, said: “This demonstrates BIAL’s commitment to support the airport cargo community and bolster the growth of Bengaluru as a cargo hub. The demonstrated effi ciencies of the Kale Logistics’ ACS will ensure development of a technologically enabled cargo community at Bengaluru airport.”

pandemic, industries, including the cargo sector, need to fi nd biggest economic crisis in ways to help digitise operations. Piloting and implementing the aviation since the Second right solutions can show an immediate return on investment World War, many transport and long-term positive business outcomes. companies and their partners “Solutions exist today that could bring cargo operators are forced to cut back as a into digitalisation. Honeywell, as an example, can aggregate matter of survival. They will data into our Honeywell Forge Cloud and leverage data into conclude that digitalisation meaningful information for optimised operations and decision is not just a more effi cient making. As an example, Honeywell Aerospace capabilities in way of doing business; digital solutions include our Airborne Data Loaders that can it is also the only way to seamlessly load digital data on to an aircraft, saving operators reduce manual processing signifi cant expense versus manual loading from cockpit, as of information. In the same well as solutions that can track real-time maintenance data The reality way that business process with predictive modelling. This gives maintenance teams re-engineering was big in the the maximum possible schedule reliability without schedule is paper-free 1980s and offshoring big in interruptions. Our Forge Flight Effi ciency systems can save the 1990s, full digitalisation cargo operators 2-4% on fuel savings annually, allowing them solutions could will prove to be a business to control their bottom line while reducing carbon emissions in be implemented case for cost reduction. But the environment. just like business process re- “The company also works with many in the cargo sector without much engineering and offshoring to help achieve signifi cant improvements in effi ciency, speed before, it will require an and accuracy in their operations through the use of mobile downtime investment for a payback. computers, printers, data capture devices and software Amanda King, Honeywell “The focus must shift solutions. These solutions provide real-time data to those who from documents to data. need to make decisions, helping them to achieve operational There are good reasons for excellence.” resistance, but they are not good enough. The tech The way ahead infrastructure is there, the The air freight industry still has great opportunities to digitise technology part is ready. And the processes, procedures and how shippers, freight forwarders if you move to data you can and airlines interact: that much is abundantly clear. draw intelligence from that IATA’s Mulder concludes: “In what is proving to be the data, and automate.”

24 August 2020 www.airlogisticsinternational.com STRATEGY FREIGHT

NEW DAY DAWNING? Here Matt East, Senior Advisor - Logistics and Infrastructure Policy for the UK, Europe & Middle East, at GHD, wonders if COVID-19 will herald a new era of effi ciency.

ill COVID-19 catalyse re-location of populations, from future similar events could see producers and distributors the advent of a moving from urban to rural looking to local manufacturers rather than international suppliers. Wnew global freight areas. These manufacturers would ideally be located near to where the strategy by encouraging a shift key supplies are required. Nearshoring or reshoring could be one in modes of transport and Reading the changes “new norm”. improving network effi ciency? In the UK, for example, this has The current situation provides an opportunity to consider COVID-19 has generated resulted in a 30% reduction of strategic locations where local manufacturing and production unprecedented disruption freight movements across all hubs could be key in providing this resilience, while acting as an in the global logistics and modes, including maritime, economic booster to those regions. freight industries, severely rail and HGV. As we move into impacting operations and the recovery phase following Making effective use of capacity delivery activities. However, COVID-19, we need to The reconfi guration of the supply chain and modal shift is an could these current challenges understand if these changes to idea that has been mooted previously, with the intention that ultimately pave the way for the supply chain confi guration these modifi cations would help us achieve particular industry a more streamlined, effi cient will be temporary, or if the way goals, such as the net zero targets. In 2017, the UK Government and environmentally friendly in which we operate and plan issued the Freight Carbon Review, which identifi ed options for future? the logistics network will be making more effective use of current capacity on the rail, water It’s a tempting thought. transformed from this point on. and road networks. The report notes that a signifi cant reduction Demand for essential goods, Beyond economic of greenhouse gas emissions could be achieved through increased such as produce, medical stimulation, the need for a use of rail freight, deployment of longer semi-trailers and improved supplies and Personal Protective more resilient supply chain to logistical effi ciency by means of more widespread industry Equipment has signifi cantly mitigate potential disruptions collaboration. increased, while manufacturing The report also recognised the constraints around network capacity has decreased capacity occasioned by passenger demand; however, it is because of various lockdown anticipated that more people will elect to work from home restrictions. In the short term, following COVID-19, resulting in an estimated 20% reduction hauliers, international gateways in passenger train movements on the rail network. If similar and retailers are facing a impacts are experienced across the overall transport network, climate of uncertainty. additional capacity for freight paths may become available, where The community has it previously did not exist. experienced disruption to points of supply and quantities A window of opportunity? of freight available; it has been Therefore, the pandemic may have just provided the industry affected by disruption to freight with a window of opportunity to accelerate a modal shift, while handling across international reconfi guring the network to provide more effi cient distribution. borders; and the reduced A clearly defi ned The industry can proactively plan to respond to these changes number of vessels, vehicles strategy would and grasp this opportunity by collaboratively developing a holistic and personnel available across strategy for the movement of freight across and within countries. the supply chain has affected provide confi dence A clearly defi ned strategy would provide confi dence around the routes taken. Moreover, around resilience for resilience for current and future disruptions by addressing changing demand patterns as existing and potential policy and regulation amendments. This, consumer and business needs current and future in turn, would also inform decisions to optimise the supply change, is evident - and then chain to achieve cost effi ciencies (supply to demand ratio), and there has been a noticeable disruptions… concurrently reduce the environmental footprint. www.airlogisticsinternational.com August 2020 25 Sustainability on the ramp: KLM is testing TLD’s TaxiBot in collaboration with

ENVIRONMENTAL ENVIRONMENTAL UPDATE Schiphol airport

The ramp is not overlooked, either. KLM is currently testing TLD’s TaxiBot in collaboration with Schiphol airport. The TaxiBot is a hybrid towing Green shoots vehicle, making taxi-ing more The Editor finds that from carriers to the cool chain, much is sustainable since it allows the aircraft engines to be shut being done to enhance the environment. down: the pilot operates the actual pushback. Furthermore, he world continues Biomaterials since 2008, as aviation related to sustainable KLM is replacing all of its to turn, COVID or no well as one of the founding aviation fuel. Air France diesel-powered lower deck TCOVID. So, too, does members of the Sustainable has long supported the loaders with electric models the desire to make the planet Aviation Fuel Users Group. development of a viable and is consequently the a healthier place in which to In addition, KLM is one of industry for the production of world’s first airline to take this exist. All the aviation sector the founders of SkyNRG. In sustainable fuel for aviation. step on such a large scale. stakeholders are involved in 2019, it made a decade-long It has been trialling the use of Within the cargo this grand design, and the commitment to developing such fuel on its commercial warehouses at Charles de cargo chain is no exception to and purchasing an annual flights since 2014 and invests Gaulle and Amsterdam, a the rule. 75,000 tonnes of Sustainable substantial sums in innovation new energy-efficient lighting To take just one example, Aviation Fuel, thereby alongside research institutes. system has replaced the Air France and KLM have a becoming the first airline in traditional set-up, enabling strong involvement in the the world to invest in SAF on Other initiatives an 80% saving (through a development of a sustainable this scale. In November 2019, AFKLMP Cargo has looked reduction in energy and market for aviation fuel. Air France and Shell signed a at every innovative idea maintenance costs), together Both Air France and KLM memorandum of undertaking to reduce the weight of its with an avoidance of 285

have established innovative confirming their commitment aircraft. The lighter an aircraft tonnes of CO2 emissions a partnerships with corporate to fuelling the airline’s is, the less fuel it consumes. year. customers, suppliers, airports flights on departure from Consequently, lighter cargo and logistics partners. San Francisco with a blend of nets, containers and pallets are Recycling efforts conventional and sustainable deployed. In fact its cargo nets AFKLMP Cargo also takes A fuelling legacy fuel for aviation. are 50% lighter than standard several measures to reduce In order to ensure the supply Back in 2012, KLM pallet nets and save 795 litres waste or make sure recycling of sustainable feedstock, the launched the KLM Corporate of kerosene annually. This occurs where possible. In

carriers have been members of BioFuel Programme, a first accounts for 2.5 tonnes of CO2 Amsterdam, efforts have the Roundtable on Sustainable corporate programme for reduction per year, per net. resulted in a residual waste

26 August 2020 www.airlogisticsinternational.com reduction of 49% compared to to its work on reducing food journey, hundreds of people 2011: at this hub, 85% of the waste. Within this framework, run an increased risk of getting total waste is recycled. 2019 saw the defi nition of sick or worse. Sustainability is At Air France, a permanent the priority measures to at the core of what all the CCA recycling system is in place be implemented for the members do.” for Air France uniforms and sustainable development of How, then, has the Cool work clothing. Uniforms air shipped exports of West Chain reduced waste? are collected and recycled African mangoes, at both a “In our projects we use via the help of energy technical (combatting fruit technology to understand recovery in the form of fl ies which degrade the quality what is going on in the textile pellets. Ultimately, of the fruit) and logistical complex supply chains that these ashes are used as fuel level (improvement in airport often stretch over large parts in the manufacturing of infrastructures at Burkina of the globe. By creating end- cement. Since 2013, used KLM Faso and in Senegal notably, to-end transparency, we can uniforms and old business and verifi cation procedures at By reducing really focus on those process class carpeting have been Paris-CDG). waste, we reduce steps where things go wrong, recycled into fi bres used to Finally, perhaps most and then work together to manufacture carpets for the telling of all, is the subject the relative carbon improve that. aircraft cabin. of e-freight. The efforts of “A good example are AFKLMP Cargo have resulted emission of products that are waiting on Combatting food waste in the savings of 3.1m sheets shipments the tarmac to be loaded on AFKLMP Cargo is also active of A4 paper in the space of one the aircraft. It’s not always Edwin Kalischnig, Cool Chain Association in the perishable goods year. feasible to keep the products transportation segment. in the warehouse and load The teams maintain a The cool chain viewpoint them just in time. But while permanent relationship with Edwin Kalischnig is a Cool standing on black tarmac in all the players in the value Chain Association Board excursions, we also wasted the hot sun, temperatures chain (producers, exporters, Member and CEO at Xtreme the water that was used for may rise to 50-60ºC. Adding a importers, supermarkets, Technologies. irrigation, the fuel that was thermal blanket or keeping the airport authorities “For the Cool Chain used to truck it to the airport, products in a cool dolly will and so on) to promote Association, sustainability the carbon emissions from signifi cantly reduce the risk of sustainable development is about people, planet and the airplane, and so on. If a temperature exposure in this in the agricultural and air profi t. Improving the quality shipment of vaccines that is process step. transportation sectors. and processes in the cool strictly to be kept between “Continuous improvement The Group is also a chain will result in less waste. 2-8ºC arrives at destination but of cool chain processes will member of the Cool Chain When a shipment of papayas can’t be used because it was slowly but surely raise the Association and contributes is wasted through temperature frozen or too hot during the overall quality levels. By

XPO EXCELS XPO Logistics has been named a 2020 build on the progress we’ve made, Green 75 Supply Chain Partner by providing our customers with eco- Inbound Logistics magazine for the friendly innovations to move goods fi fth consecutive year. XPO is one of 75 throughout their supply chains.” companies honoured for helping shippers XPO’s Sustainability Report maintain environmentally conscious provides details about the supply chain operations. company’s environmental Troy Cooper, President of XPO initiatives, including logistics Logistics, said: “XPO is proud to once automation, fl eet emission again be recognised as a Green 75 technologies, sustainable company and a leading industry partner packaging and alternative fuels in sustainability. We’ll continue to and energy sources. www.airlogisticsinternational.com August 2020 27 ENVIRONMENTAL ENVIRONMENTAL UPDATE

capturing data, we now know products, from origin to can take 4,000 degree-hours what’s really going on inside destination. This will also GEVO GRANTED in total before they die (this is a truck, inside the belly of an provide valuable insights FUNDING IN established in vase life tests), aircraft or while waiting in for creating stability budgets AUSTRALIA that means that the total cool between. New tools like AI in last mile deliveries of chain has a “budget” of 500 and Machine Learning can pharmaceuticals. Colorado-based renewable jet degree-hours. This budget help us analyse shipments “The industry is currently fuel producer Gevo has secured can then be divided over the from the past and help predict used to working with funding from the Queensland different players in the supply shipments of the future.” temperature ranges, for government to support the chain. And to make the cool chain example 2-8ºC/15-25ºC for assessment of a waste-to-biofuel “The actual calculations greener? pharma and 0-4ºC and other project in the Australian state. are a bit more sophisticated. “By reducing waste, we ranges for perishables. If The Queensland Waste to Temperatures below 0ºC are reduce the relative carbon an excursion outside of the Biofutures Fund provides targeted measured separately and we emission of shipments as temperature range is measured, funding for pilot, demonstration can introduce “impact factors” the various transport modes products may have to be put or commercially scalable for higher temperatures, are used more efficiently. into quarantine for analysis or biorefinery projects that use but this can all be simply Besides that, our members complete shipments may be conventional waste streams or programmed. Measuring the are looking into various discarded. biomass to produce bioenergy, degree-hours on a tag and upcoming technologies and “It is sometimes a biofuels and high-value broadcasting relevant data developments, like electric challenge to maintain bioproducts. The award follows via, for example, Bluetooth, trucks, lighter packaging and these narrow temperature an initiative in which Gevo took allows the key players to work passive cooling containers ranges. This results in parties part to supply aircraft at Brisbane together. By sharing data they that don’t require electricity, being reluctant to measure airport with blended sustainable become transparent, can create alternative fuels... just to name temperature and share the aviation fuel through the airport’s timely alerts and prevent a few.” data. So shippers will put general fuel supply system. things from going wrong. loggers in with their products, Gevo’s participation in the They can act like a team Current R&D focus but can only determine trial, which was completed last where one player can even “The CCA has always had results at the end of the year and which involved Virgin compensate for another. a strong focus on quality journey – when it’s difficult to Australia and the Queensland The end result will be better and process improvement understand what went wrong government, has led to the state quality, less waste and to reduce risk and waste in and who was responsible. being considered as the location increased trust in the cool the temperature sensitive “But basically we have for the company’s first biorefinery chain.” supply chains of perishables all been asking ourselves the outside of the US. and pharmaceuticals. wrong question. What is really And for the future? Our Cool Chain Quality interesting to know is the “Facilitating and enabling Indicator has been adopted temperature exposure over vertical and horizontal and adapted by the industry time – and this is measured collaboration, education and has contributed to the in degree-hours. If a flight and innovation amongst its development of current takes ten hours and the members and all key players standards, like IATA’s CEIV required temperature range is the main objective of the Pharma and CEIV Fresh. is 2-8ºC, then the airline is CCA. We organise at least “Close co-operation allowed to add 8C x 10h = 80 two conferences a year, one between CCA members has degree-hours of energy. Now, focused on pharmaceuticals resulted in a number of suddenly, we have a very and one on perishables. This innovations. Thermal blankets, simple KPI to measure and is where people meet, where reefer shipments of flowers report. results from projects and new by train, cool dollies and real- “This also allows for developments are shared and time temperature monitoring budgeting the total chain. discussed and where new solutions were all developed Flowers in your home at 21ºC ideas and projects originate. by or with CCA members. get 21 x 24h = 500 degree- The community that we have “Our latest project is hours per day. With a seven- created is gaining momentum focused on tags that measure day vase life guarantee, 3,500 and we intend to improve the temperature exposure in degree-hours are allocated for future by giving the cool chain degree-hours of perishable the consumer. If the flowers industry a voice.”

28 August 2020 www.airlogisticsinternational.com Uniting the world’s aviation community for the fi rst time since Covid-19

“The Annual GHI Conference is an extremely important conference for our industry. While Covid-19 has had an unprecedented impact 30 Nov-3 Dec 2020 on our industry, now is an even more important time to host this event as the landscape of the industry changes before us.” Carm Borg, President & CEO, Global Aviation Services Take advantage of our special covid-early bird rate Save 20% o„ your delegate fee

Special Covid-early bird €2080 + VAT

To fi nd out more visit our website: annual.groundhandling.com POST COVID-19 COVID-19 POST

Off the radar Readers are all well aware of the trials and tribulations within the sector at present – but what lies ahead, when the dust finally settles?Alwyn Brice harvests some thoughts from the cargo community.

ith the tidal wave that The biggest shock global consumer demand is has engulfed the “The aviation business has just suffered the biggest shock in its likely to remain subdued Wworld, certain modern history,” reckons Wilson Kwong, Chief Executive, Hactl. meanwhile, as much of the industry players have become “No war or natural disaster has ever before grounded up to world has now entered adept at treading water whilst 95% of the world passenger airliner fleet – and for months. This recession through job losses some have disappeared under meant that, at one time, the air cargo industry had lost some and falls in output. In other the waves. For yet others, the 45% of its total flown capacity, placing a huge burden on the words, in the short to medium onset of the coronavirus has much smaller freighter fleet to keep supply lines open, and to term, the industry can obliged them to focus more, cope with the huge demand to move PPE and other medical probably tolerate a reduction and critically examine their supplies globally. in belly capacity.” operating model. This latter “The legacy of this pandemic is likely to be a very protracted section of the freight industry return to the levels of passenger flights which existed pre- The importance of the longer is quite probably also the COVID-19. Through necessity, we have all learned to conduct term picture contingent that is looking over business remotely via teleconferencing, and so some of the He continues: “But – given the the horizon to prepare for former business travel market may never return. That, in turn, importance of freighter what lies in store. will make some routes unviable, or at least will drive a reduction operations to Hactl, what An altered operating in frequencies and an increase in economy fares. Leisure interests us is the longer-term landscape would appear to be travellers may also take some time to regain confidence. At the picture. The world economy inevitable in this respect – but same time, a number of government bail-outs for airlines have will eventually recover, as it will the players within the come with green conditions, requiring a reduction in flights. The always does. That will increase industry be able to adapt? Or combined result of these factors will be a loss of bellyhold the call on cargo capacity, will they seek to return to a capacity, at least in the short to medium term; but possibly much of which will have more familiar environment, forever. disappeared. Many airlines even if it is a largely alien one? “PPE and medical supplies traffic is gradually subsiding, while today are utilising their vectorpouch/stock.adobe.com

30 August 2020 www.airlogisticsinternational.com passenger wide-bodies as not merely a short-term revenue boost for combination carriers, temporary freighters, in a bid but a much more important and valued aspect of the future to replace at least some of their global commercial aviation sector.” lost passenger revenues; but Interesting comments indeed, which would suggest that the this is only a short-term freighter is going to become the prima donna of the skies, solution. Importantly, though, denting the cast-iron (or in this case aluminium or composite) it is restoring the importance reputation of the passenger jet. Certainly, in the short term, there of cargo for airlines, and is (as are very real grounds for being of this opinion; but surely, in the our own research tells us) bigger picture, and when all this uncertainty has died down, we already leading to increased are going to see the passenger service rule the clouds again – interest in converting aren’t we? There’s actually redundant passenger planes For Gerry Burgin, of Gerry Burgin Cargo Associates, this a gap in the into freighters. scenario appears questionable. “In our view, the future “We are going to see changes in the cargo operation,” he freighter market – industry will rely much more affi rms. “Look at the current situation: passenger planes being on freighters, and much less used for carrying cargo. If you compare one of them to a proper there really aren’t on belly capacity. The capacity, freighter, only about a third of their capacity is utilised. Clearly, enough of them consistency and reliability this is not a sustainable operation in the longer term; it’s really Gerry Burgin, Gerry Burgin Cargo offered by freighter services only a short-term plug.” Associates will once again command a premium, as they once did. Opportunity awaits Meanwhile, it is to be hoped “My feeling is that the likes of Atlas, and more particularly that we never again reach the Amazon, are going to seize the opportunity that has been gap in the freighter market – unhealthy imbalance between presented by the pandemic,” Burgin continues. “They could there really aren’t enough of supply and demand, which easily end up cornering the market, since there are plenty of them. And the market drove cargo rates to redundant passenger aircraft out there which could be converted dynamic is changing all the unsustainable levels. With into freighters. We’ve read about what Amazon has been doing in time – the sidelining of A380 sensible decision making on the US with Sun Country: they have plenty of airlift and with fl eets is just one example.” all sides, cargo could become more freighters, they could start taking charge of the main traffi c For another example of routes. The fi nal mile section is arguably less interesting to them history repeating itself, Burgin since the big numbers come from the major routes. They could draws on the 1980s. “Will we certainly call the shots, and the charges; and if Amazon does it, have another wave like the then Alibaba will surely follow. You only have to think about one which saw TNT, FedEx and things like same day delivery: ten years ago the very idea was DHL pick up the parcel side of unheard of. And if it works in the US, then the next logical step the cargo equation? They went would be an international operation. Really, general aviation is down to the basics and I miles behind these sorts of companies. haven’t seen Kuehne + Nagel “And, unless airlines and forwarders react quickly enough, able to operate at that level. they could be left with the crumbs on the table.” It’s all a question of vision.” (It’s interesting to note that literally a couple of days after this Some readers will probably interview, Amazon announced that it was offering a seven days a be aware of Burgin’s lack of week package delivery service within the UK – and for goods sympathy for the freight ...some of the other than those ordered through its websites - Ed). forwarder, a species he sees in imminent danger of former business The fate of rates extinction. “They still don’t, or Burgin goes on to relate that he has seen it all before and offers won’t, invest,” he reiterates. travel market may by way of example the fi rst Gulf War. “Then, rates soared: one “Airlines are happy to put never return day they were 50 pence a kilogramme, the next tariffs went up to money into the passenger side £2 a kilogramme. People paid up – they had to – but at the end of the equation but cargo is Wilson Kwong, Hactl of the hostilities the rates dropped back down again. Today, rates usually ignored. The are far too low in my opinion. They were climbing on cargoes technology is out there for coming out of Asia to Europe when capacity was scarce and when anyone thinking about the PPE was in demand, but that’s all changed now. There’s actually a future but all I see is a sector www.airlogisticsinternational.com August 2020 31 POST COVID-19 COVID-19 POST

the status quo of cargo, points that he believed were unknown operation: a new business inside the boardroom. model will have to be In this, he was indebted to Des Vertannes, ex-Head of IATA implemented. Cargo, who whilst there, came up with some telling statistics. “Next, there is the Understanding this data before any thoughts of shaping the economic factor. Look at the future are formed would appear to be essential. consumers. They’re in a state Vertannes found that as a percentage of global airline of shell-shock at the moment. revenues, First Class travel represented 4% of airline revenues. They are used to spending on Business Class contributed 16% of airline revenues whilst cargo their credit cards but they are represented 12% of airline revenues. So, Wraight observes, for putting off expenditure right global airlines over the last decade, cargo has produced three now and paying back debts. It The short times the First Class revenues total and very close to that of will take time for them to pick answer is that Business Class revenues. up again from where they left He argues that typical North American airlines report only 3, off pre-COVID. we need a new 4 or 5% of total revenues deriving from cargo but a huge chunk “Third is the air passenger of that passenger revenue accrues from domestic or trans-border market: how many planes do business model US/Canada fl ights. you see in the sky? The Stan Wraight, Strategic Aviation “Without that domestic factor, what would that cargo passenger market has been Solutions International percentage be? Using European carriers as benchmarks it’s 10% badly hit. Until a vaccine is plus; Middle East carriers 15-25%, depending on which one; and found there is no travel for Asian carriers, well over 20% is the norm.” insurance for COVID-19 and lawyers over here are saying The cargo contribution that if staff are sent on dragging its heels. He goes on to state that one major European airline has advised business travel and contract “Will we see an that pre-COVID-19, 70% of all international fl ights were not the disease, then they could improvement next year? I profi table without the cargo contribution; while another major sue. doubt it – there will be slow operator discloses a fi gure close to 60%. So, Wraight asks, how “International traffi c, I growth, perhaps, but I think a many carriers that fl y transcontinental long haul, with wide- think, will take three to fi ve more realistic timespan is two bodied aircraft, realise as passenger yields continue to decline, years to get back to 2019 to three years. There’s a lot of how important cargo in the bellies is to the economic levels. People are making plans retail stock that needs to be sustainability of intercontinental services right now – and more to holiday in their own moved. And what if, as the especially, in the future? country now – and if you do experts predict, we suffer a “The short answer is that we need a new business model,” he decide to go abroad, you may second wave of this virus later told ALI. face 14 days’ quarantine when this year?” “The world post-COVID-19 won’t be what it was before. In my you return. business I take a holistic view: I’m looking at what’s happening “So what we have is fewer An intransigent sector in Asia, for example. There, I see countries like Japan and Korea aircraft, and more emphasis on Like Burgin, Stan Wraight, talking about relocating businesses. Then I look at US/Chinese cargo, since there are fewer President/CEO of Strategic relations. President Trump may, or may not, get another term; passengers. The cargo division Aviation Solutions but policy making in four-year cycles only works if a large needs to capitalise on this International, looks back on amount of common sense is added. – hence the requirement for a decades of time spent within “Air cargo, I’m forever hearing, takes 1-2% of the world’s new business model. No more the freight sector. He, too, tonnages in terms of transportation yet the value of the goods it cheap offers of ground bemoans the seeming carries is 30-35%. A B747 full of computer chips and the like is handling: we need intransigence of a community far more valuable than thousands and thousands of tonnes of digitalisation and we need for whom tradition is all, while coal. That’s the anomaly in all this. products geared to serving forward thinking is considered “Why will the landscape be different? Three things come to express freight and valuable something that verges on mind. The fi rst is the manufacturing sector. We are now seeing freight. Some handlers, anarchy. changes in the model: nearshoring, in other words bringing the particularly those owned by In a recent White Paper on manufacturing closer to the market, is becoming more evident. airlines, have got this already the sector’s problems, one that There’s also reshoring, where the manufacturing is fully brought – but the bigger ones, also embraced life after back home. When this happens, so the requirement for air especially those owned by COVID-19, Wraight made freight declines, which means that it will be the specialities that private equity, are some cogent comments about are left for shipment. These will require a high class, quality struggling.”

32 August 2020 www.airlogisticsinternational.com GHI webinar The GHI Big Debate: series Sustainability in Aviation TOPICS TO INCLUDE:

The sustainability agenda Sustainability as a new business tool Airport infrastructure Stakeholder collaboration and sustainability

Thursday 3rd September Sponsored by †.†† EST (UTC -) ‡.†† BST (UTC +) ˆ.†† CEST (UTC +) REGISTER TODAY  FREE TO ATTEND! annual.groundhandling.com/webinar-series or email [email protected]

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A safe restart The socially distanced turnaround Reducing manual handling injuries through GSE

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GHI_Webinar_HP__AUG_2_Ad.indd 1 05/08/2020 17:18 www.airlogisticsinternational.com August 2020 33 CARGO CARGO LOADER FOCUS

ir Marrel, as a sole entity, facility has been recognised by has an extensive history operators at Vatry airport. Ain the manufacture of hi- Ideally situated near Paris yet lifts dating back well over four just far enough outside to be decades and, until relatively High profile unaffected by the congestion recently, was an autonomous of the capital city, this station supplier. Chinese company In the first of an occasional series has witnessed a huge demand CIMC, which has various for cargo flights, initially for interests, including those of the Editor takes a look at some of the the carriage of PPE and other airside equipment, finalised COVID-19 related equipment, the acquisition of the French equipment providers within the cargo much of which has been enterprise back in 2013/2014, sector. In this issue, it’s that of French destined for Asian countries. adding it to its portfolio. This airport owns a fleet of 35 Innovative probably best company CIMC Air Marrel. tonne CIMC Air Marrel describes CIMC Air Marrel’s loaders, which allows it to outlook on the ramp: aside serve the numerous heavy from the fact that this St carriage of pallets of 88 x 108 safely and efficiently. The cargo flights. At present the Chamond-based company inches with a maximum manufacturer has just delivered LAM 35000 is only available offers what is arguably the weight of 1,600 kilogrammes; the first examples to operations with diesel power but under biggest range of cargo loaders moreover, a height of up to in the Philippines, banking on development is an electric to be found within the realm 1.25 metres can also the boom in regional cargo version, in keeping with the of GSE, it was also responsible accommodated. flights around Asia and Europe. company’s environmental for developing a loader that Because there was no concerns. functions with hydrogen specific loader in the market High capacity Aside from these two power, the only manufacturer capable of serving this aircraft’s At the other end of the innovative loaders, the ever to have created such requirements in its modified spectrum, CIMC Air Marrel can manufacturer can supply more equipment. Green, today, role, CIMC Air Marrel decided supply a 35 tonne loader, mainstream loading solutions, continues to be a predominant to design a focused loader which is in fact the biggest ranging from 7 tonnes to 14 thread within the company’s based on the existing capacity cargo loader to be tonnes. With a universal philosophy. LAM3500 technology: this found in either the civil or platform, they are capable of development has allowed military sectors. Thanks to its reaching the upper hold of Targeted developments handlers to work at loading design, the rear platform on freighters. These can be Recently CIMC Air Marrel and unloading the ATR both this LAM 35000 loader can specified with electric power enlarged its range of loaders so simultaneously lift three 10 and the operator can choose that now it can offer solutions foot pallets, thereby bringing a between li-ion or lead-acid ranging in size from 3.5 to 35 An example of CIMC Air Marrel’s prowess: benefit of 30% in terms of the batteries; they are also tonnes capacity. The company this is a 35 tonne loader in operation at cargo loading cycle. This equipped with safety approach Vatry airport says that in view of the current systems, in accordance with crisis within the cargo sector, IATA guidelines. the importance of regional Rounding off the range, freight carriers has come to the CIMC Air Marrel offers cargo fore in the absence of transporters that can carry passengers: quite simply, pallets of 10 feet or 20 feet in pressing passenger aircraft into size: these have a 20 tonne service as cargo mules has been capacity. of enormous benefit in the In summary, the COVID-19 battle. Thus pallet positioning of CIMC Air Marrel and container loading has within the dedicated freight been the order of the day and marketplace has allowed it to the changing scenario has react to the dip in commercial prompted more than a few aviation by responding to the operators to look at the needs of handlers and airports ATR-700 as a suitable means of who may not have a dedicated conveyance. This aircraft, with fleet of equipment for serving its large door, allows the the swelling freighter traffic.

34 August 2020 www.airlogisticsinternational.com BEST STATION BEST CARGO HANDLING OPERATION HANDLER-AIRLINE INNOVATION RAMP SAFETY UNSUNG HERO GSE INNOVATION

1 DECEMBER COPENHAGEN

FREE TO NOW OPEN FOR ENTRY ENTER Entry Deadline: 18 September 2020

GHI’s Pride of Ground Handling Awards 2020 will have a special emphasis on championing the part played by aviation employees in battling the coronavirus pandemic this year.

GHI needs your help to showcase our sector’s starring role in securing the supply of critical medicines, PPE as well as performing passenger screening/cleaning regimes as part of pandemic response plans.

We will also seek to showcase non-Covid-19 related examples of ground service excellence, innovation and the all-important people who make it happen.

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