INTERNATIONAL EDITION JANUARY 2011 Africa grows two-way trade E-freight or else India pharma focus Diplomatic carriage January, 2011 Volume 14, Number 1 contents EDITOR Simon Keeble [email protected] • (770) 642-9170 ASSOCIATE EDITOR/WEB EDITOR Jon Ross [email protected] • (770) 642-8036 Africa SPECIAL CORRESPONDENT No shortage of two-way demand Martin Roebuck 20 [email protected] +44.(0)20-865-70138 Pharma CONTRIBUTING EDITORS Roger Turney, Ian Putzger The shifting pharmaceutical landscape COLUMNISTS 26 Brandon Fried, Gabriel Weisskopf PRODUCTION DIRECTOR E-freight Ed Calahan Customs key to paperless trading [email protected] 30 CIRCULATION MANAGER Nicola Mitcham [email protected] Diplomatic traffic ART DIRECTOR Full screening an issue for diplomatic CENTRAL COMMUNICATIONS GROUP couriers [email protected] 34 PUBLISHER Steve Prince [email protected] ASSISTANT TO PUBLISHER Susan Addy [email protected] • (770) 642-9170 WORLD NEWS DISPLAY ADVERTISING TRAFFIC COORDINATOR Linda Noga [email protected] 4 Europe AIR CARGO WORLD HEADQUARTERS 1080 Holcomb Bridge Rd., Roswell Summit 8 Middle East Building 200, Suite 255, Roswell, GA 30076 (770) 642-9170 • Fax: (770) 642-9982 12 Asia WORLDWIDE SALES 30 U.S. Sales Japan Associate Publisher Masami Shimazaki 16 Americas Pam Latty [email protected]. 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ACW JANUARY 2011 1 editorial Britain’s awful airport he British Airports Authority (BAA), created by Margaret Thatcher’s government by blithely turning a nationalized monopoly into a pri- vate one, could better be named Band-Aid Airports. Still owned by the Spanish, who appear to be favoring a profit-to- sell plan rather than an investment strategy, Heathrow continues to be a facility waiting for a climate change screw-up. At best, it just Tabout works for both cargo and passenger handling; but given the recent debacle of “snow days,” British Airways’ customers and investors should not be encour- aged by the airport management’s initial response. With impressive understatement, the BAA’s CEO Colin Mathews commented: “We were overly optimistic about how quickly we could clear the stands of snow. I regret that.” Simon Keeble Unimpressed by the modest mea culpa, the EU’s transport commissioner, [email protected] Siim Kallas, suggested he was going to force airports to be better prepared and added: “I have become increasingly concerned about the problems relating to the infrastructure available to airlines — airports and ground handling — during this severe period of snow.” Philip Hammond, Britain’s transport secretary, responded to the misery at Heathrow by saying the coalition government will consider whether the country is experiencing a “step change” to its weather that would justify “Continental- style” winter equipment to keep roads and airports open. As with many things British, the government will announce an enquiry into why thousands of tonnes of freight and many more passengers were stranded at the world’s largest international airport during some of the busiest few weeks of the year. Also, like many things in what Hammond describes as “Modern Brit- ain,” not much will change — unless it is to apply another aviation tax to pay for any improvements. Bowing to public and governmental pressure, the BAA will spend some of its pre-holiday profit forecast of £972 million ($1.5 billion) for 2010 on more snow clearing equipment — which will probably do double-duty as earth movers while a new passenger terminal is being built. A government enquiry will make recommendations for improvements at Heathrow, but will hardly suggest a change of ownership due to incompetence. BA will take a hit due to loss of revenue, while hoping that its future relationship with another Spanish company, Iberia, will be less costly. For the freight forwarder, Heathrow appears to be expensive real estate to handle UK imports and exports. While it is unlikely that any of the major lo- gistics groups will decamp, some of the BAA’s less well-heeled tenants might decide to take their business elsewhere. According to IATA, world trade — i.e. the flow of air cargo — follows the busi- ness traveller. So if there’s one lesson that should be learned from this peculiarly British debacle, it must be to change ownership of the BAA — or learn Spanish. 2 january 2011 ACW viewpoint Deflating industry value house in a London suburb for $6,000; a loaded the perceived value of air cargo and its rate levels. family car for $3,000; or a professional sales- A major factor in today’s under-priced market is the man for an annual salary of $3,000. These industry’s general failure to get its message across. One would be unbelievable bargains in 2011, symptom is the steady attrition of the media that serve wouldn’t they? That’s what you’d pay today if the industry and traditionally have helped underscore its Athese commodities had suffered the same degree of defla- importance in the wider commercial arena. The death of tion as air cargo prices since 1980. many periodicals and the thinning of those that remain is How is it that an industry that is just as good at doing its a direct result of the continual and unjustified reduction job today — despite all the complications of in airline advertising budgets for cargo. These compliance with heightened security measures always fall when times are tough, but never — has allowed its products to fall in value by recover when things get better. When you look up to 95 percent in real terms? at expenditure on cargo “marketing” against You could blame over-capacity and marginal passenger promotion, there is no comparison. pricing driven by passenger carriers for whom Cargo was always under-resourced relative to cargo space is just a by-product. And you’d be its revenue and profit contribution, but never partly right. It’s certainly not falling demand — more so than today. volumes on every route are vastly greater than Even those carriers that invest sensibly in they were 30 years ago. But I’d say that the air the external promotion of their products often cargo industry may simply have lost sight of its fail in the attempt through employing ill-suited true value when measured against the alterna- resources. Advertising agencies and media re- tives. Or maybe it’s just not getting its message lations firms that understand the passenger across. It’s all in the marketing. Or perhaps Derek Jones business and are attuned to spending huge more accurately, the lack of it. sums on mass media are not necessarily the Marketing is often defined as “the management pro- ideal custodians of the tight budgets typically found in the cess responsible for identifying, anticipating and satisfy- cargo side of the business. One result of such mismatches ing customer requirements profitably.” By that yardstick, is picking the wrong media and filling them with bland, ir- at least some elements of the industry have got it right. relevant creative work — or bombarding long-suffering air The integrators have done a slick job of spotting the wide- cargo journalists with ill-informed PR “puff.” spread need for speed, playing on the fear that an urgent This is bad news for the companies to which these ob- shipment won’t be delivered on time unless tracked every servations apply.
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