Vol. 11 No. 20                            #INTHEAIREVERYWHERE                              Tuesday February 26, 2013

Nabil M. Khojah (right) has been named as the new CEO of Saudia Cargo in Jeddah, as Fahad Hammad, (left) current CEO of Saudia Cargo, takes up the reins for the development of current facilities at airports, including the Cargo Village project at King Abdul Aziz International Airport.
     Mr. Khojah is a veteran of Unilever and most recently served as Managing Director at Exel Saudi Arabia (Olayan DHL Supply Chain).
     He holds a university degree from the Faculty of Industrial Management, King Fahad University for Petroleum & Minerals.


 

he past three years have witnessed a boost in air cargo traffic between Asia and Africa due to investment in African infrastructure.
     At the same time, global demand for Africa’s natural resources and other commodities has soared, generating more wealth in parts of the continent.
     The result has been an increase in African consumer spending on imported goods from Asia.
     Today carriers remain confident air cargo from Asia to Africa will continue to offer solid, long-term prospects, especially if the improved political stability seen in many African countries continues.

     We asked Head Of Calogi Worldwide Cargo Distribution Patrick Murray who attended and sat on a panel last week at Air Cargo Africa, what his take was on the event.
     “I spent much of my time taking advantage of the networking opportunities and learning about the air cargo market in Africa and how Calogi can support its growth,” he said.
     “There is a great deal of interest in our trading platform and the meteoric rise of the African market offers many possibilities— both for Calogi and automated processes.”
     Looking at last week’s discussions at ACA’s ‘The Path to Profitability’ panel provides a window to the action in Johannesburg, South Africa, where ACA met.
     An interesting mix of speakers from different backgrounds was included, providing a variety of views on how the industry can stay profitable in the coming years.
     With two aircraft manufacturers on the panel, the question was asked whether freighters could be run profitably.
Both suppliers agreed modern cargo jetliners are eco-efficient, reducing CO2 emissions and noise levels, and allowing cargo to remove the dependency on airline passenger business and benefit from opportunities in emerging cargo markets such as Africa.
     It was also noted that there is room for a simple, low-cost carrier approach to air cargo; paying a reduced rate for cargo at the time of booking would improve the airlines cash flow and reduce the number of no-shows.
The panel also discussed how to make it easier for customers to do business.
     A key point was the popularity of passenger portals like Expedia, and if the air cargo industry would accept the transparency of having competing rates side-by-side.
     “Calogi already has rates side-by-side,” Patrick Murray said.
     “My message was clear: margins will remain under pressure over the next year, meaning the industry needs to reduce its costs, and one way to accomplish this is by embracing automation.
     “For example, in Dubai we implemented the e-AWB and e-delivery order for dnata, which will save the handler around USD $1 million this year, savings which dnata shares with its customers in the form of a discount on such electronic transactions.
     “When the forwarder executes the air waybill or requests a delivery order, Calogi sends the shipment data to the handling system, which creates the shipment record, calculates the handling charges, and issues an invoice.
     “Currently we process over half a million shipments a year in this fashion.
     “The result is that dnata has been able to merge the company’s import and export counters, reducing their cost of airport real estate and, because of the reduced data entry, redeploy 40 percent of their counter staff to much needed positions.
     “Processes like this are a simple, but innovative feature of Calogi and make it easier and more cost effective to do business.”
     During the three days of Air Cargo Africa the themes were plentiful, but two messages seemed to resonate.
     The air cargo market is becoming more competitive and integrators and other modes of transport are diluting traditional air cargo business.
     As an industry, air cargo needs to give customers an easier way to interact with airlines.
     “Industry stakeholders can step up and get things going, but a push from GACAG to simplify the business can help jump start this initiative,” Patrick Murray said, adding:
     “The air cargo industry needs to do more to improve its margins.
     “Despite the interesting and lively debate during Air Cargo Africa, overcapacity in certain markets will mean this conundrum still remains.”
(Geoffrey)
Geoffrey/Flossie



African markets are very important to AF-KL-MP Cargo and we are a major player with both passenger and freighter service to this continent,” said Jan Krems, Vice President Americas at Air France/KLM Cargo/Martinair.
“Between our three carriers we can reach a majority of the major oil and gas markets in the following countries:
               AF: ABJ, BZV, CAI, DLA, JNB, LAD, LOS, NDJ, PHC, PNR,SSG
               KL/MP: ACC, CAI, CPT, DAR, EBB, JNB, LAD, LOS
     “The majority of the traffic we move is oil and gas related, whether it be drilling equipment, production supplies, or construction material.
     “On the traffic side we are experiencing continued growth in airfreight demand to West Africa and Angola.
     “We experienced solid growth in airfreight traffic in 2012 to our African destinations.
     “Part of our success in the African market is based on our flexibity to meet market demands.
     “For example we have the ability to also utilize special barge service from AF freighter destinations in Africa to reach key oil and gas installations with oversize cargo.
     “So for shipments moving to Soyo or Luanda, we can fly them into PNR and then transfer to a barge service for the final leg to the destination.
     “The same can be done for shipments to Malabo and Liberville by flying into DLA and transferring to the barge service there. This transit can all be done under one AWB from origin to destination.
     “We can also position any of our freighters for a charter or special re-route to accommodate our customers' needs.
     “So Africa is and will continue to be a strategic market for AF-KL-MP Cargo and we will continue to build on our success in 2013.”
Geoffrey/Flossie


Desmond Vertannes
Global Head Of Cargo
International Air Transport Association

At TIACA 2012

Last week’s ACA has been a landmark event.
Considering this is only ACA's Second Edition, a significant number of industry executives from global and regional markets invested considerable effort to magnify the continents' growing trade links and opportunities, despite present economic challenges.
     The conferences drew good attendance, were very interactive (reinforcing the enthusiasm) and outputted some brave commitments.
     The exhibition was populated by major brands and it was encouraging to see local and regional players being so active and prominent.
     It bodes very positively as a key diary commitment for 2015!


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     The big news out of Air Cargo Africa includes the emergence of Saudia Cargo as “Best Airline To Africa” at ACA last Thursday. Saudia may take as much (if not more) comfort having delivered sterling performance figures earlier this week.
     “We are very proud,” said VP Commercial, Peter Scholten.
     The 90-minute sessions, or “roundtables,” continued on Thursday and Friday and involved how best to profit from the cargo business (no breakthroughs there), understanding Europe’s supply chain, and overcoming the infrastructure and security challenges in Africa. Kenya Airways’ COO Mbuvi Ngunze reported KQ moved 62,504 tons in 2012, up 10 percent from 2011:
     “There has been a surge in demand for cargo transportation across Africa, and Kenya Airways has provided a vital link to the rest of the world,” he said.
     Air Cargo Africa wrapped Friday with mostly favorable reviews in our snap poll. There is no doubt that with Africa as venue for the first big show of the year (after several months of no-show drought), the usual suspects at these events seemed satisfied. Whether or not ACA 2013 delivered much business for stakeholders is likely being discussed in meetings as you read this.
      Etihad said it has inked a strategic partnership with Kenya Airways, with usual code sharing plus KQ flight launch to the UAE later this year
     James Hogan, Etihad Airways President and CEO, and Dr. Titus Naikuni, MD & CEO Kenya Airways, are pictured announcing the deal. Etihad hopes to close on acquiring a stake in Jet Airways, India’s largest private airline. Jet would be EY’s fifth airline deal of this sort in just over a year.



     CHAMP Cargosystems said that Russia’s largest cargo carrier, AirBridgeCargo (ABC) implemented a weight & balance solution that drives better loading of aircraft . . .
     The Port of Tampa is now an entry point for shipments of wing and fuselage assemblies destined for Embraer’s jet assembly plant in Melbourne, FL. Planning approval has been given for the $1.6 billion expansion of Melbourne’s port capacity at Webb Dock; the work is set to start . . .
     New Zealand’s largest port, Port of Tauranga netted $74.2 versus 34.6m (2011), another record half-year profit as container traffic and bulk volumes continue to grow . . .
     Port+ signed a long-term deal with Martinique Airport to utilize its AirPort+ Cargo Community IT System at MGI through 2016. Up and running since 2011, Francois Mahe of Port+ declares: “Martinique was the first platform in the world to be equipped with a tri-modal system. Being first is rarely the result of chance." Voila! . . .
     A recently agreed upon Los Angeles port contract brings stability back to the supply chain, USA National Retail Federation, NRF said. “Now it is time to turn our attention to the East and Gulf Coast ports,” International Longshore & Warehouse Union added . . .
     Swissport said revenue totaled CHF 1.9 billion in 2012, up 10 percent from 2011 . . .
     EFIS Air (ECS Group), GSA in the UK, Belgium, and the Netherlands for US Airways Cargo, now adds France and a daily Airbus A330 CDG to PHL and 15 tons outbound CDG daily . . .
     Camiel Eurlings takes over as KLM President & CEO on July 1, 2013, succeeding Peter Hartman, who retains his seat on AF/KL BOD before retiring next January . . .

     UPS inducted 1,283 drivers into its elite "Circle of Honor," raising to 6,486 the number of drivers who have steered clear of accidents for 25 years or more. UPS also said it has driven a turn-key supply chain deal with Jabil Circuit, Inc., that combines UPS warehousing, transportation, returns management, and other capabilities with Jabil’s reverse logistics planning, repair, and call center support . . .
     Boeing is spending $1 billion a month to keep producing new B787s that are grounded and parked as they roll off the line. B787 has been described as the worst marketing disaster in Boeing history . . .
     Etihad Cargo January tonnage surged 27 percent to 32,613, marking a record. During 2012 cargo rose 19 percent. “Demand will be greater again in 2013,” EY said . . .
     Cargo biz at LATAM Airlines dipped 1.1 percent in January “driven by weaker imports into Latin America”…
     Cargolux flies to Port Harcourt, Nigeria, March 5 and says it will “add African destinations in 2013” . . .
     Schenkers has expanded Nuneaton, its main land hub in UK, to “7,960 square meters with 21 loading bays and state of the art security” . . .

     European Commission dubs 2013 “Year of Air Events” with slogan “Clean Air It’s Your Move.” Centerpiece is June 4-7 “Green Week” at EGG Conference Center in Brussels . . .
     EC said on Tuesday that it would not prolong or renew maritime transport antitrust guidelines due to expiration date of September 26 . . .
     Air Menzies International’s new Mumbai office tests water toward further push into sub-continent . . .


     Our son Ralph is a big fan of the late Stanley Kubrick; in fact, it can rightly be said that we are all fans of the filmmaker.
     But Ralph is a director, so for him, talking Kubrick has been a fact of life for many years.
     In fact, we enticed Ralph and his sister Emily to AMS to video TIACA in 2010, with the express promise of routing them home via Paris, where a Kubrick retrospective was taking place.
     Now in 2013, our sons Geoffrey and Ralph and daughters Flossie and Emily (who is the tall, thin dancer seen in the video) take a new view on Kubrick’s immortal anti-war film, Dr. Strangelove.
     A collaborative effort, all the Arend children participated in the video. Geoffrey wrote the song and financed the project, Ralph directed and provided much creative input and inspiration, Emily danced in background, and Flossie provided creative advice.
     The result is quite amazing.
     We are obviously proud and want to share.
     Here is what we do aside from air cargo.
     Hope you enjoy the view.
Geoffrey


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