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customers almost anywhere in the world. Fresh and on time.

For enquiries about moving fresh produce or any of the products

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7

Qatar Airways ups frequencies

niche is fAster for profit

internet shopping is driving growth

electronic Air wAybills mAke slow progress

mobile dAtA meAns eAsier trAnsActions

The weekly newspaper for air cargo professionals

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QATAR AIRWAYS is continuing its growth across Africa and the Indi-an sub-continent with an increase in flight frequencies to Asmara, Eritrea, and to Dhaka, Bangladesh.

From 7 September, flights from Doha to Asmara will be increased from four to five times per week, rep-resenting a 25 per cent increase in capacity, according to Qatar. All flights are operated with an Airbus A320. The Asmara expansion comes only nine months after the Eritrean capital was first introduced in December 2014.

Operated with an Airbus A330-300, on 9 December flights from Doha to Dhaka, Bangladesh, will be increased from 10 to 14 weekly, increasing ca-pacity by 40 per cent.

Qatar Airways group chief execu-tive, His Excellency Akbar Al Baker, says: “We are delighted to offer even more opportunities for our customers across the globe to connect through Doha’s state-of-the-art Hamad Inter-national Airport to both Eritrea and Bangladesh, flying on board one of the youngest fleets in the industry.”

Finnair is claiming revenues for April to June this year will be about the same as the second quarter of 2014 at 561 million euros ($620.1 million), but its results are still negative and it has already said the outlook for cargo is uncertain.

The airline’s operational result for this year’s second quarter was minus 12.9 million euros and its cash flow from investments totalled minus 53.7 million euros. Its operational earn-ings before interest, depreciation, amortization and restructuring (EBITDAR) from the second quarter was 37.4 million euros, slightly up on last year’s 35.5 million.

Finnair expects its revenue for the first half of the year to be about the same as January to June 2014, 1,101.4 million euros. Finnair chief exec-

utive officer, Pekka Vauramo, says: “Profitability improved significantly, although the operational result still showed a loss of 12.9 million euros. The result improvement is attributed to reve-nue growth in our core business operations, the progress of cost reduction measures and the decline in fuel prices, which is reflected in

our costs gradually due to our hedging policy.” Vauramo explains that the appreciation of the US dollar against the euro, “diluted the bene-fit from fallen jet fuel price and significantly increased our other dollar-denominated costs.” What has helped, he adds, is, “the appreciation of our income currencies boosted our revenues particularly in Asia”.

In May, Finnair said that the demand out-look for cargo traffic in its main markets, “still involves uncertainty”. It also expects that its unit costs, excluding fuel, will increase from the 2014 level due to structural changes in the business and the dollar’s appreciation. In Octo-ber, Finnair will start flying the Airbus A350. It hopes its use of this aircraft will improve its cost competitiveness.

transformation works for QantasQ

antas Freight reported what the Australian airline describes as a, “record underlying EBIT [earnings before

interest and tax] of $114 million [Australian dollars], compared with $24 million in [fiscal year] 2014,” when it announced its full year results for the 12 months ending 30 June. While the Qantas group says it made 975 million Australian dollars ($715.6 million) in profit before tax during the year. It explains that the, “underlying result,” is a turnaround of 1.6 bil-lion Australian dollars compared with the financial year 2014, and “Qantas’ best ever second half performance”.

Qantas Freight’s sister airlines are, Qantas, the low-cost carrier, Jetstar, the regional airline, Qan-tasLink and the charter airline, Network Aviation.

For Qantas Freight, its parent airline says that its other successes include, the renewal of Australia Post as its biggest domestic freight customer and adding the new cus-tomer, Toll Group. Earlier this year,

Qantas was informed by the Hong Kong authorities that Jetstar Hong Kong would not get a licence. This has brought Qantas’ interest in the airline to a halt. In his results speech, Qantas chief executive, Alan Joyce, says: “Qantas has written off its minority stake in Jetstar Hong Kong, with an impact of 21 million [Australian dollars], following the Hong Kong regulator’s decision not to approve the airline’s oper-ating license. Qantas will make no further investment in Jetstar Hong Kong.”

However, Qantas is invest-ing more in the Boeing 787-9

Dreamliner. It will join the Qantas international fleet from 2017. Qan-tas will buy eight 787-9 to replace five of its older Boeing 747, “and open up a range of potential new city pairs”. Four 787-9s will arrive in the airline’s 2018 financial year and four will arrive in the follow-ing fiscal year. “This will leave the Qantas Group with its six youngest reconfigured [Boeing] 747,” says the airline.

As well as the eight firm 787-9 orders, Qantas will retain 15 fur-ther options and 30 purchase rights for additional 787, with what is says is: “significant flexibility

over the timing of delivery.” Joyce, says: “This milestone acquisition marks the scale of our turnaround and looks ahead to a new era for our iconic international airline.” Qantas has been undergoing a transformation programme, as its management calls it, to bring the airline back into profitability and a sustainable economic future.

Joyce adds: “We’re half-way through the biggest and fastest transformation in our his-tory. Qantas is rapidly growing fitter, stronger, and smarter.

“These [Boeing 787] aircraft are a fitting emblem of that evolution, they show that we are revitalised and here for the long haul.”

Joyce and his team’s expectations for Qantas are a capacity increase of up to four per cent in the first half of the next financial year for 2016. That capacity increase will come from new routes and the introduction of the Boeing 787-8, before the 787-9 enters service. In his speech, Joyce says: “We said we needed to pay down one billion [Australian dollars] in net debt, and we’ve done that.”

Uncertain outlook clouds Finnair profitability

Volume: 18 Issue: 33 24 August 2015

NEWSWEEK

J uly saw a year on year cargo throughput drop for Hong Kong International Airport of 1.9 per cent to 363,000 tonnes.

The airport blames the decline on a five per cent year on year (YOY) drop in transshipments. It says that exports declined by one per cent compared to the same month last year.

During July, cargo throughput to and from mainland China, Taiwan and Europe also, “underperformed other key regions”. The July fall followed a June drop, when cargo volumes decreased by 3.5 per cent to 349,000 tonnes. That month’s outcome continued the gateway’s trend this year of monthly declines and is the fourth year on year (YOY) monthly fall in 2015.

At the time, the airport’s authority explained that the cargo traffic in June was suppressed by the weak Eurozone econ-

omy along with a slowdown in Asia Pacific imports and exports. May has also seen less cargo, a slip of 0.3 per cent, according to the Airports Council International (ACI) Asia Pacific.

However, comparing the January to July period this year and in 2014, Hong Kong saw 0.2 per cent more cargo, at 2.4 million

tonnes. On a rolling 12-month basis, the airport has handled 4.3 million tonnes, a YOY increase of 2.4 per cent. In a more pos-itive move, in July, the airport welcomed Sky Lease Cargo. Sky Lease began operat-ing scheduled cargo flights to Miami (US) twice a week with its Boeing 747 Freighter from 16 July.

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Freight keeps falling at Hong Kong

CARGO carriers, such as Finnair Cargo, will be operating the Airbus A350 eXtraWideBody (XWB) and filling its bellyhold with freight for extra revenue on long haul routes. The wings for the first Airbus A350-1000 variant have begun the pro-cess of assembly at Airbus’ Broughton (UK) factory.

The A350-1000 wing has the same span as the Airbus A350-900 wing that is already in service, but the trailing edge has been extended to resize the wing for more payload and range. The A350 XWB wing is 32 metres long by six me-tres wide and made from carbon fibre composite material.

Airbus A350 wing in production

Solar powered Indian airportCOCHIN INTERNATIONAL AIRPORT has declared itself the first fully solar powered airport in the world.

Forty five acres of photovoltaic (PV) panels have been laid out near the airport’s cargo complex in the Indian state of Kerala. These panels will provide 50,000 to 60,000 units of electricity a day. When combined with the output of existing solar facilities at the airport, this will be enough to power all of Cochin’s operational functions, making it, “absolutely power neutral,” the airport says.

Airport management installed its first solar PV plant in 2013, followed by a one MegaWatt peak (MWp) solar PV power plant. This was installed partly on the airport roof top and partly on the ground in the aircraft maintenance hangar. Together, these plants have saved more than 550 mega-tonnes of carbon dioxide emissions to date.

The newly commissioned 12MW peak solar PV plant has been developed by German engineering firm Bosch. Compo-nents include PV modules of 265Wp capacity, made by green energy specialists ReneSola, and inverters of 1MW capacity manufactured by ABB India.

The project is just one of a number of solar energy initiatives underway in India. The country has four gigawatts of solar ca-pacity at present, and aims to reach 100 gigawatts by 2022.

Cochin is one of Southern India’s main cargo airports. Its cargo village, when complete, will feature separate centres for marine products, couriers, express cargo and valuable and vulnerable cargo.

ACW 24 AUGUST 2015

NEWSWEEK

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C athay Pacific’s interim 2015 results show a 2.5 per cent fall in cargo reve-nue, despite strong demand on some principal cargo routes.

Increased demand in cargo began last year and continued through the first few months of 2015, but fell away in the second quarter, Cathay reports.

The group’s cargo revenue for the first six months of 2015 fell by 2.5 per cent year on year to 11,376 million Hong Kong dollars ($1.4 billion). Capacity for Cathay Pacific and sister airline Dragonair grew by 8.9 per cent and the load factor increased by 0.9 percentage points to 64.1 per cent.

Despite this, says Cathay, “strong competition, overcapacity in the industry, and a significant reduction in fuel surcharges put downward pressure on yield, which dropped by 11.1 per cent to 1.93 [Hong Kong dollars].” More encour-

agingly, strong demand was seen in some of Cathay’s main cargo routes. The most notable upswing was seen on routes to and from North America, partly prompted by industrial action at major shipping ports on the West coast of the US. Intra-Asia shipments also grew, but traffic to

Europe fell short of expectations. The first half of 2015 saw Cathay change its fleet. It had been agreed in 2014 that six Boeing 747-400 Freight-ers in the Cathay Pacific fleet would be sold back to Boeing.

Two of these freighters have since been deliv-ered, one in November 2014, the other in July 2015. The remaining four freighters will leave the fleet by the end of 2016. As of 30 June 2015, the group had 72 aircraft on order for delivery up to 2024.

Cathay Pacific chairman, John Slosar, says: “We usually perform better in the second half of the year than in the first. We expect our busi-ness to do well in the remainder of 2015 and we will continue to focus on providing high quality products and services.

“We will continue to invest in aircraft, our products and the development of our network. Our financial position remains strong.”

2015 sees cargo revenue fall for Cathay Pacific

A metal beam from the 2001 World Trade Center’s foun-dation has been transported to a memorial site in South Florida with the help of American Airlines.

On Wednesday 12 August, American Airlines worked closely with the Kennedy Space Center Fire Rescue and members represented by the Transport Workers Union, International Association of Machinists and Aerospace Workers, to begin the transport of the 2,000-pound (909 kilogrammes) beam. American Airlines Cargo and Ground Services, a partner trucking company, donated all trans-portation costs for this artifact, which took a fully escorted journey from New York to Florida.

9/11 beam taken to Florida

WorldNewsSILK WAY WEST AIRLINES has taken de-livery of its third Boeing 747-8 Freighter, out of a total order of five. Silk Way’s fleet now numbers five aircraft. They are three 747-8F and two Boeing 747-400 Freighters. Following the delivery of the 747-8F, Silk Way is planning to launch additional new services to Singapore and Komatsu (Japan). The remaining two 747-8F on order will arrive in 2015.

FEDEX TRADE NETWORKS, the freight forwarding and customs brokerage arm of FedEx has announced the appoint-ment of Dr Udo Lange as executive vice president and chief operating officer. In his new position, Lange is responsible for overseeing all global air and ocean freight forwarding and customs broker-age operations for the company.

Fatigue rule demandedUPS pilots have marked a crash anniversary by calling for all-cargo airlines to be included in a rule designed to reduce fatigue among commercial pilots.

The pilots are demanding an end to the carve-out of all-cargo airline operators from FAR Part 117, the new pilot rest and operating rules enacted by the US govern-ment’s Congress. Part 117 is the first major revision of pilot flight and duty limits and rest requirements in 60 years. The new rule is science-based and designed to mit-igate fatigue among commercial pilots. All-cargo airlines are carved out of Part 117 for “political” reasons, the pi-lots claim.

“This carve-out puts our nation’s entire aviation system at risk,” says former National Transportation Safety Board chriman, Jim Hall. “A tired pilot is a tired pilot, regard-less of the plane he or she may be flying. By excluding cargo pilots from Part 117, the [Federal Aviation Admin-istration] FAA is failing to adhere to its mission of making safety the first priority in aviation. If the FAA believes even one life lost in an accident is too many, the principle should also apply to cargo pilots.”

The Independent Pilots Association has opposed the cargo carve-out since it was announced, going so far as to sue the FAA. The crash anniversray that was marked was that of UPS Flight 1354. It crashed on approach to Bir-mingham-Shuttlesworth International Airport in August 2014, killing captain Cerea Beal and first officer Shanda Fanning. The cockpit voice recorder transcripts showed that the crew were suffering from fatigue.

NEWSWEEK

4 ACW 24 AUGUST 2015

Aden gets aid by charter flightAIR CHARTER SERVICE (ACS) has ar-ranged the first civilian cargo flight into Aden since conflict broke out in the Yemen almost five months ago.

Aden is the temporary capital of the country, following the Houthi’s takeover of Sana’a in March of this year. “Civilian cargo flights carrying much needed humanitari-an aid have not been allowed into Aden for months, but we arranged for an [Ilyushin] IL-76 aircraft to fly there last Thursday, on behalf of a GCC [Gulf Cooperation Coun-cil] country’s government,” explains ACS chief executive officer, Justin Bowman.

“The aircraft was carrying 35 tonnes of aid, consisting of food stuffs and medical supplies, along with six diplomats. More than 50 hospitals and health facilities have been destroyed since the beginning of the troubles and people are in desper-ate need of more than just what we have delivered.”

ACS has already arranged more than 20 relief flights to the country’s largest city, Sana’a, and carried out the first direct flight from the United Arab Emirates to the Yemen earlier this month.

Load planning goes electronicKALITTA AIR is the first US airline to use CHAMP Cargosystems’ web-based load planning application.

The Michigan (US)-based all-cargo carrier will use CHAMP’s Weight & Balance applica-tion across its 14-strong fleet of Boeing 747 freighters.

“Kalitta Air selected CHAMP’s Weight & Balance as we were confident that the application meets the requirements of our expanding business,” says Kalitta Air chief exective officer, Conrad Kalitta.

“This modern, well proven, IT solution will enable us to perform our load planning faster and more accurately thanks to its high degree of automation, leading to an overall reduction of time and costs. Easily being able to optimise the centre of gravi-ty will provide additional benefits as well as

fuel savings.” CHAMP cargo services vice president, James Fernandez, adds: “We are delighted that Kalitta Air has selected CHAMP’s Weight & Balance solution to man-age the load planning for their fleet.

“Kalitta Air is our launch North American client, further expanding the global func-tional capability for our Weight & Balance solution.”

Weight & Balance is a new generation ja-va-based, modular built application enabling airlines to plan all aircraft loads, however complex.

It also helps the user keep the aircraft within permissible centre of gravity limits throughout the flight. Weight & Balance also features an auto-load option on multiple legs. Kalitta Air began operating airfreight services in November 2000.

I ndian airline SpiceJet has chosen a Smart-Kargo cloud-based air cargo management solution.

SpiceJet says it is the first airline in India to choose SmartKargo, which it will use for both its in-house and international cargo operations.

Built by Massachusetts Institute of Tech-nology software engineers, SmartKargo is a 100 per cent cloud-based solution running on Microsoft’s Azure platform. It is accessible 24 hours a day, every day, from any internet browser. “SmartKargo’s robust capabilities will help SpiceJet further build its cargo business, and enable it to deliver even better customer service to shippers across its growing network”, says SmartKargo founder and chief executive officer, Milind Tavshikar. “India will be Asia’s second fastest growing market with a [com-bined annual growth rate] of 6.8 per cent, and SpiceJet, India’s second largest low fare airline,

is poised to play a leading role in the freight delivery chapter of the Indian growth story. With advanced booking and handling tools like SmartKargo, SpiceJet will not only replace a leg-acy system, but will also deliver a much higher standard of customer satisfaction,” says Spice-Jet business development vice president, Amit Srivastava.

SpiceJet operates a 36 strong fleet with 252 daily flights from principal hubs in the Indian cities of Delhi, Chennai and Hyderabad to 34 Indian and seven international destinations, including Dubai, Kathmandu and Colombo. The airline’s daily cargo capacity is about 300 tonnes.

SmartKargo is based in Cambridge in the state of Massachusetts (US). Clients include Hawaiian Airlines, which became SmartKargo’s first North American customer in June 2015.

Cloud cargo control for Spicejet

Turning a corner for success?JET AIRWAYS’ results for the first quarter of 2015 suggest that its three year turn-around programme is working.

The Mumbai (India) based airline, part-owned by Etihad Airways, saw total revenue increase by 11 per cent in the first quarter, to 56,580,000,000 rupees ($865,967,815). Jet recorded a profit of 22.6 billion rupees, a significant improve-ment on the 2.5 billion rupee loss seen in the same period last year.

“Our performance in the first quarter of this financial year demonstrates once again that the measures we are taking to bring the business back to profitability are having the desired result,” says Jet Airways’ chairman, Naresh Goyal. “All the major key performance indicators have shown progress.” Synergies with partner

carriers and the implementation of a con-sistent brand strategy across the entire domestic operation are said by the air-line to have contributed to Jet’s improved results.

Jet operates a fleet of 116 aircraft, fly-ing to 73 destinations in India and beyond. As a member of Etihad Airways Partners, Jet says it benefits from, “synergies,” achieved through joint maintenance, cabin crew training and common procure-ment of aircraft, fuel, and insurance. “The competitive and structural challenges...continue to put pressure on our yields and costs. In addressing these, we continue to focus on leveraging the...synergies through our partnership with Etihad Airways,” says Jet’s chief executive officer, Cramer Ball.

NEWSWEEK

5ACW 24 AUGUST 2015

T urkish Airlines made one billion Turkish Lira in net profit ($350 mil-lion) in the first half of 2015 on a revenue of 12 billion Turkish Lira, an increase of 9.2 per cent, according to

the airline, on its 2014 results during the same period.

The airline has claimed an operating profit of 524 million Turkish Lira, which it says is, “outperforming the first half of 2014 by 68 per cent”. In the first half of 2015, Turkish Airlines also realised a capacity increase of 10.1 per cent. Turkish Airlines now operates 290 aircraft comprising 69 wide body, 212 narrow body and 9 cargo aircraft together with 23 aircraft addi-tions in 2015.

The airline says: “In the first six months of 2015, a period with severe fuel price and cur-rency fluctuations, Turkish Airlines grew its net profit by six fold compared to the same period of 2014 with the help of its diversified debt struc-

ture and dynamic risk management strategies.” Earlier this month Turkish Airlines and LOT

Polish Airlines announced that they had signed a letter of understanding to implement a strate-gic partnership. Turkish Airlines and LOT have been code sharing on each other’s flights on the route Istanbul-Warsaw since October 2000. They already operate five weekly flights on the Istanbul-Warsaw service. Now, the airlines have agreed to proceed towards future joint venture

cooperation. “This strategic partnership...will enable both carriers to enhance their presence on their respective markets, while contribut-ing their efficiency on the routes agreed within the scope of extended cooperation. Consid-ering their membership to the same alliance group, one can say that such a strategic partnership will also benefit Star Alliance,” says Turkish Airlines chief executive officer, Temel Kotil.

One billion net profit for Turkish Airlines for 2015

CANADIAN express airline Cargojet has declared a 69.6 per cent revenue increase to $75.2 million for the second quarter (Q2), compared to the same period in 2014.

According to the airline, its gross margin for the quarter ending June was a 39.3 per cent increase on April to June last year. This year’s Q2 gross margin was $7.3 million, $2.1 million more than April to June 2014. Another multiple digit increase Cargojet has claimed is its earnings before interest, tax, depreciation and amortization (EBITDA) which it says increase, before “one time costs,” by 147.7 per cent compared to 2014, to $10.9 million. However, includ-ing one time costs sees its EBITDA drop to $6.6 million.

“One time costs related to the expansion of our core overnight network that started in March 2015, for a major customer were in line with our planned expenditures,” says the airline’s president and chief executive officer, Ajay Virmani. “Overall customer demand for Cargojet’s pri-mary overnight network services and its air cargo charter services were softer than expected in the quarter and we continue to match capacity to actual demand, in order to keep operating costs in line.”

Last week, Cargojet announced its successful recertifica-tion of its ISO 9001:2008 quality standard accreditation, for the fifteenth consecutive year. The airline says it is the only air cargo carrier in Canada with this accreditation. Car-gojet says it carries more than 1,000,000 pounds (45,454 kilogrammes) of cargo each business night. Its network across North America uses a fleet of Boeing freighters.

$75m Q2 revenue for Cargojet

WOrldNewsRHENUS LOGISTICS UK is launching its extended service to Japan. The firm can ship all types of products includ-ing fashion, precision engineering and dangerous goods. The company now operates five airfreight consolidations per week. The majority of the service to date has focused on exporting consum-er goods to its key destinations in the Japanese ciites of Tokyo and Osaka.

AIA CARGO is opening an office in Dub-lin Airport on 1 September. AIA will be offering a sales portfolio of carriers of-fering worldwide connections to Asia, Australasia, Europe, Middle East, and North and South America. For several years AIA Cargo used third party sup-pliers to cover the Irish sales areas of Dublin, Shannon and Cork, but the de-cision was made to open its own office.

double-digit rise for Cebu airlineCARGO revenues for Philippine carrier Cebu Pacific Air jumped by 11.4 per cent in the first half of 2015.

Overall, its revenue for the six months to 30 June was 29.5 billion Philippine pesos ($636.8 million), an increase of 10.4 per cent year on year. Cargo revenues accounted for 1.6 billion pesos of this.

“The CEB Group’s notable [first half] 2015 passenger growth was driven by the launch of CEB’s operations in Na-rita, and new long haul routes including Riyadh, Sydney, and Kuwait; and the launch of additional domestic routes. We look forward to offering our trademark low fares to even more passengers this year,” says the airline.

Cebu claims to be the largest carrier in the Philippines. It has a 55-strong fleet, and expects to increase this sig-nificantly by 2021. The fleet comprises 10 Airbus A319, 31 Airbus A320, six Airbus A330 and eight ATR 72- 500. By 2021, Cebu expects to take delivery of seven A320 and 30 Airbus A321neo aircraft. Earlier this year, Cebu, with Cargohaus, inaugurated a Smiths Detection CIP-300 air cargo inspection portal, at Manila International Airport’s Terminal three. The portal is for transhipment cargo loaded in international flights to and from Manila. It can screen up to nine tonnes of air cargo dolleys and unit load devices and is powered by a low-energy X-ray source.

NEWSWEEK

6 ACW 24 august 2015

CEVA extends Asian 3M dealCEVA LOGISTICS has extended its South East Asia collaboration with 3M.

The Singapore-based logistics specialist will remain 3M’s preferred logistics service provider in warehouse management and distribution in Singapore, Malaysia and In-donesia, with an extended remit.

Under the terms of the renewed contract, CEVA will operate both 3M’s regional dis-tribution centre and national distribution centre in Singapore, with an increased warehouse footprint of nearly 28,000 square metres.

CEVA also manages 3M’s national distri-bution centre in Malaysia and Indonesia. It supports 3M with warehouse management activities, inbound and outbound operations, inventory management, bonded warehouse storage, raw materials, and inbound logis-

tics of the plants. 3M’s David Werner, Asia manufacturing and supply chain director, says: “We are pleased to work with CEVA and leverage their supply chain expertise to maintain a strong, robust supply chain for 3M in this region to better serve our customers.”

CEVA has more than 42,000 dedicated employees, working in 17 regional clusters around the world. The company recently signed a long term contract with Universal Music, to manage their contract logistics operations in Brazil.

CEVA‘s responsibilities will include ware-housing activities (inbound, outbound, storage, inventory control), distribution (air and ground), transportation management, proof of delivery), fiscal management, deliv-ery monitoring and reverse logistics.

Polar reaches South East AsiaPOLAR AIR CARGO WORLDWIDE’s inau-gural flight to Changi Airport landed on 16 August local time adding the Asia Pacific airport to its route network.

This adds to Changi’s freighter network, the US city of Cincinnati. Polar will operate a weekly Cincinnati–Anchorage–Incheon–Singapore–Hong Kong service with a Boeing 747 Freighter.

Singapore is the first South East Asian destination for Polar Air Cargo. The new freighter service connects DHL Express’ South Asia hub in Singapore to its Cincin-nati and Hong Kong (China) global hubs, as

part of the integrator’s multi-hub strategy to strengthen its market position in Asia. Polar Air Cargo‘s owners are DHL Network Oper-ations and Atlas Air Worldwide Holdings.

Polar Air Cargo Worldwide executive vice president and chief operating officer, Rob-ert Hyslop, says: “We are pleased to begin flying to Changi Airport. With the addition of this route, we continue to expand our global reach.”

Last month, Polar Air Cargo owner Atlas Air reported a second quarter result that was almost double the revenues of the same period last year.

S T Aerospace saw revenue shrink by four per cent to 517 million Singapore dollars ($367.7 million) in the second quarter, compared to the same period

in 2014. The shrinking revenue reflects the falls in

income from ST Aerospace’s business func-tions, aircraft maintenance and component and engine repair and overhaul for the quarter and the first half of the year.

Only engineering and material sciences saw an increase for the first six months with a 12.5 per cent hike. In ST Aerospace’s different markets, the US faired the worse with a 13.5 per cent fall. Europe did best with an 84.6 per cent increase. But, the company’s revenues out-side of Asia, the US and Europe, fell 24.1 per cent.

The results follow the June announcement at the Paris Air Show of the Airbus A320 family passenger to freighter (P2F) programme, which

ST Aerospace is a partner in. In last week’s financial announcement, ST Aerospace says: “We remain focused on our freighter conver-sions strategy as we added A320, A321P2F to our conversion portfolio.”

With 517 million Singapore dollars revenue, ST Aerospace made a second quarter profit before tax of 70.6 million.

Revenues falling at ST Aerospace Coppinger welcomes West StarWEST STAR AVIATION will open a mainte-nance, repair and overhaul (MRO) facility with more than 40,000 square foot of space at Chattanooga Metropolitan Airport.

West Star Aviation specialises in the repair and maintenance of airframes and engines, as well as major modifications, avionics installation and repair, surplus avionics sales, accessory services, paint and parts. According to the Tennessee (US) Department of Economic and Community Development, the facility is a $22.3 million investment and will create 200 new jobs in Hamilton County, where the airport is located.

The 40,000 square foot facility will house mixed-use space, which will be used for administrative and customer offices, engineering avionics, as well as accom-modate the storage of customer aircraft parts. Hamilton County mayor, Jim Copping-

er, says: “This is another exciting addition to Hamilton County’s continuing quest for new economic development. Addi-tionally, West Star Aviation will add to the diversity of our existing Hamilton County businesses.”

An additional 60,700 square metre site adjacent to the facility is slated for ex-pansion as well. Operations will include all disciplines of MRO support such as paint facilities, maintenance hangars, back shop activities and an accessory shop. West Star also operates facilities in the US states of Illinois, Colorado, South Carolina and Missouri. “The aviation friendly location and existing facilities will allow West Star to better serve East coast corporate aviation flight departments,” says West Star chief operating officer, Rodger Renaud.

7ACW 24 AUGUST 2015

Niche is faster for profit

DHL announced the launch of its e-commerce Shanghai terminal located, in Jiuting, China, in July along with plans for additional drop off centres in the North and South of the country by the end of 2015.

The Shanghai terminal is a dedicated DHL e-commerce facility which the company believes will help it tap into the burgeoning e-commerce sector in China. It functions as the central point of consolidation of e-commerce goods from China for global distribution.

DHL already operated its own centre out of Hong Kong, but says the base in Shanghai will help reduce transit time by up to three days for manufacturers, particularly in Eastern and Northern China. “We’re excited by China’s e-commerce sector where the trade volume in the first five months of 2015 was already equal to the whole of 2014,” says DHL e-commerce chief executive, Thomas Kipp.

“With about 95 per cent of outbound logistics volume expected to come from nine provinces, we will continue to invest to grow our footprint in China and support the rising market demand.

“By the end of the year, the Shanghai terminal will be complemented by a network of drop-off centres in North and South China. These centres will help provide regional consolidation of the large volumes, aggregating the ship-ments before they move to Shanghai for final distribution around the world.”

E-commerce terminal launched

EXPRESS SERVICES

F reight airlines like IAG Cargo are carving out niche operations in express deliveries to reflect the needs and demands of modern lifestyles and a competitive commercial world, whether it is urgent parts for the aerospace industry or fresh flowers.

IAG Cargo manager of global products, Daniel Johnson, tells Air Cargo Week (ACW): “Our core Prioritise product is predominantly there to serve the needs of a very wide ranging customer base within the express sector. It is ultimately about speed, reliability and assurance, and over the past three years we have continued to develop it.

“Last year we launched our capacity guarantee feature, which guaranteed capacity for anything under 300 kilogrammes and that was really in recognition of the growth we have seen in small packages. There is a need to guarantee capacity for last minute bookings, regardless of how busy the flight is, and we’ve put mea-sures in place for this”.

Johnson explains that his firm has developed products in line with market demand and at the end of 2014 launched Euro-Connector 24, which uses Prioritise and guarantees customers shipping anywhere into or out of Europe, or within Europe, using a narrowbody aircraft network with delivery from origin to destination within 24 hours. “It is very well documented that e-commerce continues to boom, double-digit growth we contin-uously hear year on year, so that uses our Prioritise and Courier products.

“We continue to see very strong growth in the smalls, but other industries like oil and gas, aerospace, automotive and fashion have all seen increases in demand for not just the speed ele-ment of Prioritise, but also the guaranteed capacity element, the performance guarantee includes a 50 per cent money back if it doesn’t fly as booked.

“Last year we expanded our Prioritise product to allow the car-riage of perishables like flowers and seafood. These have a finite lifespan and often speed is required to get it from origin to des-tination. To achieve those same day connections through London we allow those types of commodities to use Prioritise.”

Prioritise was introduced some 18 months ago and is attrac-tive to customers needing an element of speed. “Typically it might be crabs and razor clams coming down from Glasgow on a same day connection through London and then off to China, where

there is certainly a growing demand for European sea-food.” In terms of investment, IAG Cargo has responded to market needs. “In some instances it may be tweaks to the product but others have required some investment,” says Johnson. “Last year, we made a significant investment at London Heathrow [Airport] to better handle our Prioritise product by improving our break and build capability, storage and racking for smalls, and introducing dedicated drop off and collection areas for anything under 32 kilogrammes.”

Johnson readily admits it is an aggressively competitive mar-ket with tight margins and other carriers have their equivalent express offerings. “We are always looking at how we can better meet those changing demands, whether that be something in aerospace or fashion. But, we don’t anticipate there to be any slowing down and it certainly is, as a business, it is where our focus is at the moment, in terms of developing our Prioritise product to meet those demands. A big focus for us is understand-ing how we can provide a better express service, not just from Heathrow but across all of our network.”

Johnson admits that the development and growth of exper-ess services for IAG Cargo and its competitors is a reflection of

the way the world works now. “It is a fast business evolving and responding quickly to what the market wants. As IAG Cargo we need to be ready to respond to that but what we won’t ever do though is compromise on the quality service just to achieve the speed element.”

ACW 24 AUGUST 2015 8

T he race among internet vendors to deliver to India’s rapidly growing e-consumers has boosted the coun-try’s domestic air cargo traffic in the past year with double-digit growth in

almost every month.Figures released in mid-August showed India’s

freight traffic registered a compound annual growth rate of 6.7 per cent between 2006 and 2015, with domestic freight traffic increasing by 8.2 per cent and international freight traffic ris-ing 5.9 per cent in the same period

During fiscal year 2015, domestic freight traf-fic of 980,000 tonnes is an increase of 17.3 per cent and international freight traffic, at 1.5 mil-lion, an increase of seven per cent, compared to the previous year. Airlines and freight logistics operators alike have seized the opportunity to expand their services and link up with e-com-

merce firms. “Our air express business grew at an unprecedented 18 per cent in 2014 to 2015, compared to surface freight growth of 12 to 15 per cent,” says Dhruv Agarwal, executive vice president at Gati, one of India’s express distri-bution and supply chain solutions firms. “Most of this is being fuelled by e-commerce, which we

expect could account for 30 per cent of our air freight traffic in 2015.” Agarwal believes online consumer preferences are shifting to the bene-fit of airfreight business. “E-commerce players were relying on air to win the race to get their product fastest to consumers. But lately, people are being charged for express delivery options

on most sites, yet the growth momentum hasn’t flagged in air cargo traffic,” he says. SpiceJet Cargo, the airfreight division of India’s low cost SpiceJet airline, is seeking exclusive agree-ments with e-commerce and other companies, according to Manjiv Singh. He is the advisor to SpiceJet chairman Ajay Singh on cargo and spe-cial projects. “We expect the use of airlines to deliver products to pick up further once the fes-tive season approaches,” he says.

“E-commerce firms need airlines to deliver their goods to their customers as well as get deliveries from various suppliers across the country. Growth in domestic air cargo has been primarily driven by e-commercer,” says interna-tional consulting firm PwC, principal consultant, Manish Agarwal. “I expect some airlines to con-sider freighter plane services over the next year and that would be a big turning point.”

Unlocking Indian e-commerce is the keyEXPRESS SERVICES

E-COMMERCE is pushing volumes and will continue to do so in express and airmail products for Lufthansa Cargo, according to the company’s head of product and solutions management, Heike Braun (see picture).

The airline is holding its own in a challeng-ing market environment and in the first six months of 2015 reported carrying 811,000 tonnes of freight and mail, a 0.5 per cent increase over the same period the previous year.

For its express services, Braun says: “A strong industry orientation to meet all dif-ferent needs and enforced digitalisation to become even faster have been the focus for all our express services, td.Flash, Courier.Solutions and Emergency.Solutions.”

She describes express as, “a very import-ant segment,” in airfreight for Lufthansa. “We see a lot of further potential in this sector, driven by industry needs and devel-

opments and growing e-commerce,” she adds. Braun says Lufthansa wants to gain industry leadership and position td.Flash as a flagship express product.

“We are continuously developing our prod-ucts and focus clearly on the needs of our customers,” she explains.

Internet shopping is driving growth

August start for Qatar express serviceQATAR AIRWAYS CARGO began rolling out its express airfreight service for door-to-door and time-critical shipments at the start of August.

Its QR On-Board Courier service will enable customers to book time-definite air-freight delivery solutions.

It will also provide bespoke transportation services with dedicated couriers accompa-nying shipments from collection to delivery direct to the recipient.

Chief officer for cargo at Qatar, Ulrich Ogiermann, says: “Time matters to our

customers and Qatar’s new courier service will focus on speed of delivery providing re-liable transportation solutions to meet the demands of time sensitive industries such as the high tech and automotive sectors.

“With our global network operating to 150 destinations, this premium service will be invaluable for multinational businesses that are at risk of supply chain delays.”

Customers will be able to track the real time progress of their shipment at any time by using the online tracking system via its website.

International Air Transport Association (IATA) is likely to miss its electronic air waybill (e-AWB) target of 45 per cent global penetration by the end of the year.

Progress towards a paperless system remains slow and in June it edged up just 0.8 per cent to 28.8 per cent, meaning

that in each of the next six months penetration must increase by 2.7 per cent. The highest monthly growth rate so far in 2015 has been two per cent, with at least two months seeing declines rather than rises.

IATA’s roadmap to e-freight adoption set an ambitious global target of 45 per cent e-AWB penetration by the end of this year, 80 per cent by the end of 2016 with 100 per cent in 2018.

The IT sector is becoming increasingly competitive, with many different schemes and systems on the market offering potential solutions, especially to the small forwarding market.

Worldwide Information Network managing director, John DeBenedette (pictured below), tells Air Cargo Week: “Momentum is growing and we are seeing steady growth in use of our plat-form for sending data electronically alongside the paper process.

“We also see growth in IATA resolution 672 shipments, but at a slower rate than simply sending FWBs. It is hard to say if 45 per cent will be reached thjis year, but as we are working the [small and medium size enterprise] segment I don’t think we can move the needle enough on our own.”

DeBenedette cites import customs requiring paper AWBs as still being a problem in many countries. “We recently had a for-warder delay their start date for export e-AWB processing due to a bad experience they had when another forwarder sent an e-AWB inbound to them in Thailand.

“The local tax authority would not accept the AWB print from the data as the name, address fields were too short at 35 cha-rarcters for name, address one and address two. The most widely used IATA message format is limited in this way. This created a lack of confidence in their ability to safely export to many coun-tries using e-AWB, fearing their shipments would be similarly delayed at destination.” WIN has grown this year with new agents starting up each week. “Our challenge is to first get the agents connected and started on an electronic process, then they work with airline local offices to seek approval for e-AWB. The latter

process takes time and really depends on a push from the carri-er’s in the local markets,” he explains.

According to IATA’s e-AWB international monthly report for June, issued on 22 July, the top 10 countries of origin for e-AWB penetration, and ranked by e-AWB volume, are, Hong Kong, the US, South Korea, Singapore, United Arab Emirates, India, Ger-

many, People’s Republic of China, France and the Netherlands. The top 10 airlines by e-AWB volume as of June were, Cathay Pacific, Emirates, Air France-KLM Group, SIA Cargo, IAG Cargo, Lufthansa Cargo, Korean Air, Qatar Airways, Delta Air Lines and UPS Airlines.

“Every freight forwarder knows that errors and missing documents can result in costly claims and delays,” adds DeBen-edette. “They also know that having real time shipment visibility improves customer service. Despite this, the number of agents who have not yet connected to their airlines electronically is a bit scarey. Technology is no longer a big barrier, it just means busi-ness owners and airfreight managers being proactive to reduce costs, improve efficiency, and improve service.”

DeBenedette explains that it has never been easier to get started on e-AWB. “If you are a cargo agent, simply ask your soft-ware provider about converting your AWB print process into an AWB print and or send e-AWB process. WIN and other providers can make this fast and painless. You will save money immediately on most shipments, increase speed and accuracy, avoid errors and delays, and gain real time visibility.”

Electronic air waybills make slow progress

9ACW 24 AUGUST 2015

INFORMATION TECHNOLOGY

THAILAND supply chain and logistics management provid-er TIFFA EDI Services announced at the end of July that it had successfully processed more than 10,000 electronic data interchange messages in conformance with the In-ternational Air Transport Association (IATA) standards for Thailand-based forwarding companies.

With the growth of the air cargo industry in Thailand, the country is among the top nations for export shipments and hence has significant air waybill (AWB) volumes and resul-tant electronic AWB (e-AWB) potential.

IATA’s e-freight programme, which aims to digitise all documents in the air cargo supply chain, places the empha-sise on e-AWBs to enable secure, faster and correct digital transmission of AWB data to airlines.

The Thailand airfreight community has the opportunity to lead the e-freight compliance movement in the region with industry bodies like TIFFA driving the technology adoption. The e-AWB filing service on the TIFFA EDI platform is com-pletely compliant with local industry regulations.

Forwarders can use this service by three different mech-anisms at present. They are, an EDI Interface, direct filing to the portal using a web login, and a bureau service for forwarders who cannot opt for the others. TIFFA EDI Services was established in 1992 by The Thai International Freight Forwarder Association of Thailand.

Thailand takes EDI, e-AWB

ACW 24 AUGUST 2015 10

INFORMATION TECHNOLOGYMobile data means easier transactions for all

AIRFREIGHT traffic and rising security con-cerns has resulted in the need for ever more effective air cargo security and screening systems.

Customary security and screening prac-tices of physical inspection and detection through trained dogs are far from error free. New IT systems and technologies are reduc-ing potential terrorist threats and enhancing safety, says the industry.

A new report, Air Cargo Security and Screening Systems Market: Global Industry Analysis and Forecast to 2020, released mid-August by Persistence Market Re-search suggests the expansion of security measures across the supply chain offers significant business opportunities for IT op-erators and manufacturers of air cargo and security and screening systems. “Screen-ing systems for air cargo include screening systems based on x-ray, explosives trace detection (ETD) and explosives detection systems (EDS) technologies. X-ray based systems screen entire shipments swiftly and

accurately,” it says. X-ray based screening produces high penetration of detection in products ranging from meats, fish, paper, liquid and metals.

According to the report, ETD is the most popular technology used by the aviation in-dustry and freight forwarders for screening air cargo.

An EDS system consists of an apparatus which examines the physical characteris-tics of an object and a software component to process the images and data to anal-yse the mass and density of that object. A rotating-ray source is used to take large numbers of images in order to give a visual presentation of the objects contained in the examined piece.

Though EDS costs more than its coun-terparts and maintenance charges are also high, its automated nature makes its less labour intensive and so it is expected to become a fast growing segment of the air cargo security and screening systems market.

Security rules could mean IT prospects

IT specialist and niche operator Hermes Logistics Technologies is looking at how it can incorporate latest technology trends like mobile, HTML5 and a new Windows user interface into a new generation prod-

uct for airfreight handlers.Hermes chief technology officer, Oded Lavee,

tells Air Cargo Week (ACW) that a next genera-tion product would include the latest industry standards like Cargo eXtensible Markup Lan-guage, new security protocols, cold chain and e-freight management as well as being fully aligned with new technology.

“This will enable us to simplify complex pro-cesses and allow more efficient warehouse handling. Such changes will be cost effective from the warehouse hardware point of view as more types of device, handheld terminals, tab-lets and touch screens, can be used,” he says.

Hermes has just finished with its new “work

orders” innovation which aims to fully replace the paperwork order still prevalent in today’s cargo handling warehouses. “With the ability to use pre-set building blocks, the tool allows sys-

tem administrators to create bespoke process flows that can be implemented in the Hermes handheld without the need for development,” explains Lavee.

“Users can be tasked to do anything from replacing a ULD [unit load device] battery to doing a temperature check as part of an inte-grated process or, like any warehouse work order, they can choose a flight, AWB [air way-bill], ULD or customer and assign units of service directly into the system.

UK-based Hermes recently enhanced its multi-currency function within the accounting section of its air cargo management system in response to a request from Icelandair Cargo.

“New multi-currency enhancements allow Icelandair Cargo to automate the charge appli-cation, currency conversion and customer invoicing for complex tariff structures, spe-cific customer agreements and local currency precision rules to efficiently streamline their accounting function,” explains Hermes product director, Simon Elmore. “It will save them a lot of time and limit risk when manually convert-ing specific service elements from currency A to currency B.”

Multi-currency invoicing became increasingly important to Icelandair after a growing number of its fresh fish exporters began asking to do business in currencies other than the Icelandic krona. “To accommodate this, invoicing in other currencies has been done manually for the last few years,” says Icelandair Cargo IT manager, Bertel Olafsson. “But with more and more cus-

tomers wanting this facility it was apparent that being able to do this directly through the Her-mes accounting function was going to be the answer.”

Celebi Cargo Frankfurt had become the latest German cargo handler to upgrade to the latest version of the Hermes air cargo manage-ment system. The Perishable Centre Frankfurt will follow later this year. Hermes chief exec-utive officer, Yuval Baruch, says he was, “very pleased,” that the German air cargo market had reacted so positively to a strategic company goal to upgrade all customers there to the latest ver-sion of Hermes. “The latest version gives our customers more scope to amend their systems quickly and handles anything from perishables to dangerous goods whilst embracing the most current technology available,” he adds.

LAVEE

This [IT} will enable us to simplify processes

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NEWSWEEK

Eagle Express buys Volga-Dnepr care

Volga-Dnepr Gulf (VDG) is to provide maintenance services for Malaysian charter operator Eagle Express’ Boe-ing 747-400 fleet.

The contract covers maintenance services for A4 checks and out of phase routine tasks. The maintenance work will be carried out in Volga-Dnepr Gulf’s modern hangar complex located in Sharjah in the United Arab Emirates, which was launched by Volga-Dnepr Group in April 2013.

In July, Volga-Dnepr Gulf conducted main-tenance on the first Eagle Express Boeing 747-400 and work has subsequently been completed on a further two aircraft.

Volga-Dnepr Gulf was authorised to under-take the work after the Department of Civil Aviation of Malaysia evaluated the compa-ny’s hangar facilities in Sharjah Airport and

granted approval for VDG to perform mainte-nance services.

Volga-Dnepr Gulf managing director, Vic-tor Sherin, says: “We are happy to start our cooperation with Eagle Express and ready to provide high quality services to meet all of the airline’s requirements. Eagle Express is plan-ning to expand its fleet and VDG has already started negotiations regarding a long term contract for maintenance performance on its new aircraft. We are sure that the quality and efficiency of the services we deliver for Eagle Express will further enhance our posi-tion in the Middle East [maintenance repair and overhaul] market and lead to new growth opportunities.”

Volga-Dnepr Gulf also represents Volga-Dnepr Technics in the Middle East region.

Lufthansa Cargo to get 777 level D simGERMAN federal government aviation reg-ulator Luftfahrt-Bundesamt has approved the Level D-certified Boeing 777-300ER full flight simulator.

The simulator was supplied by Lockheed Martin Commercial Flight Training (LMCFT) as part of a contract with Lufthansa Flight Training. LMCFT was formerly Sim-Indus-tries. Level D is a level of simulation that is considered as good as actual flying experience.

“We are especially pleased that starting today Lufthansa Cargo, as our main cus-tomer on the new 777 simulator, can now train their pilots at their own home base,” says Lufthansa Flight Training simulator training division vice president and head, Ulrich Lindner.

The Boeing 777 simulator has an instruc-tor operating system, high-fidelity aircraft system and avionics simulation. It also

features a complete set of scenarios to ac-commodate initial and recurrent training.LMCFT vice president, Sandy Samuel, says: “The delivery of this new simulator is the product of exceptional partnership from the joint LMCFT and Lufthansa Flight Training team.”

GOL suffers double-digit income fallBRAZIL’S GOL Linhas Aereas Inteligen-tes has announced a net revenue for the second quarter of 2.1 billion reals ($603 million) with 284.3 million being generated by ancillary and cargo incomes.

While the ancillary and cargo revenues show an increase of 13.8 per cent com-pared to last year’s second quarter (Q2), according to GOL, the net revenue result for that period was a 10.5 per cent decline. GOL’s cargo services, operated through the brand name Gollog, are express, a “stan-dard” domestic service and international deliveries, for both exports and imports. The express service allows for cargo to be picked up from the airport two hours after arrival.

The airline reported that its costs and expenses, “remained [at] practically stable levels,” in the second quarter, but they did see an increase of 1.6 per cent against last year’s Q2. This outcome benefited from what GOL says was a 11.4 per cent fall in the price of jet fuel.

However, the outcome for GOL was a

negative operating result for its earnings before interest and tax with a figure of 251.1 million real for the quarter.

The airline suffered a negative operating margin of 11.8 per cent, compared to an operating income of 37.8 million real and a margin of 1.6 per cent in the second quar-ter of 2014.

For these reasons, the earnings before interest and taxation, depreciation, amorti-zation and restructuring, were 90.7 million real with a margin of 15.3 per cent.

Cargo Connections gets Chinese memberFREIGHT network Cargo Connections has added a member in China with Shanghai Multiplex Concept International Freight Forwarding joining.

Shanghai Multiplex is 10 years old with 12 employees and provides international transportation services, exporting and im-porting by sea, air and land.

Shanghai Multiplex’s services in-clude, international freight forwarding,

air transportation, multimodal, domestic, transshipments, project cargo, door to door, shipping agents and chartering, cus-toms clearance, bonded warehousing and storage, consolidation, freight calculations, customs inspections and declarations and insurance. Shanghai Multiplex vice president, Sunny Xiao, says: “Our compre-hensive logistic services mean our clients only need one shop.”