Vol. 11 No. 52                                                                                                                      Thursday May 31, 2012


 

   

     The China Airlines’ B747-400F that debuted at Chennai on May 16 marked the beginning of the twice-weekly freighter service by Taiwan’s national carrier on the Taipei-Kuala Lumpur-Chennai-Luxembourg-Taipei route.
     The first Luxemburg-bound flight carried nearly 50 tons of cargo, comprising electronic items, automotive parts and consumer goods, while the return flight also had electronics in addition to machinery and components.
     Like many carriers, China Airlines is eager to cash in on the India-China trade. In the year 2010, the volume of trade between China and India grew to $61.8 billion.
     On hand to welcome the first China Airlines freighter were a host of senior staff from China Airlines including Brian Chou, (left) Senior Vice President; K.K. Wu, Vice President, Sales and Marketing; Paul Hseuh, General Manager, Cargo Marketing and Planning; and HoJo Chang, Country General Manager, India.
     It was amply clear that the carrier’s management was keen to ensure the success of the Chennai connection.
     Among others who were at the launch of the China Airlines services were distinguished visitors from the expatriate community, among them David Hsu, Economic Counselor and Director, Taipei Economic and Cultural Centre; George Lin, Director, Taipei World Trade Centre; and Keng Lee, Director, Institute of Information Industry. Hsu was quick to point out that Taiwan had built up a significant level of investment in India despite very few Taiwanese actually residing here.
     Just a few months ago—in March of this year—China Airlines withdrew its Delhi services. With a freighter fleet of 21 aircraft, the $3.5 billion airline had to stop its freighter services to the Indian capital due to poor volumes, although it continued to carry belly cargo in its regular passenger flights coming from Taipei.
Commented Brian Chou:
     “In the past, Delhi was the hub for us. However, today it is Chennai, which has emerged as a strong hub due to the presence of large manufacturing units, including mobile phones. The new route via Chennai is very valuable for us. If the volume increases, the airline might consider having three services in a week to Chennai,” he added.
     For Chennai Airport Director E. P. Hareendranath, the China Airlines services were an indication that the recently revamped metro airport operated by the Airports Authority of India was being noticed.      Hareendranath pointed out that “this freighter service to Chennai from Taipei is mainly to cater to the growing air shipment in electronic items to the city from Taiwan and mainland China.”
     Early indicators point out that the Chennai touchdowns augur well for China Airlines. Said Chou, “The allocation from Chennai was 40 metric tonnes on each flight. The export’s focus would be primarily on electronics, mobiles, pharmaceuticals, leather, textiles, etc. The imports into Chennai would mainly consist of electronics goods.” He went on to add: “This service will provide shippers more choices for cargo in/out of India and decrease cargo transit time between East Asia to India, as well as India to Europe.”
     In India’s burgeoning cargo market, Chennai occupies the third position, trailing behind Delhi and Mumbai in annual shipment volumes. However, in terms of shipment growth, Chennai International Airport is the country’s fastest-growing airport for exports and imports, predominantly comprising electronics, automotive parts, textile products and ready-made clothes, and leather products.
     Chennai Airport handled 19,843 tonnes of cargo in the month of February this year. Of the 8,321 tonnes of import cargo, 3,131 tonnes comprised electronics/electrical items. Exports were to the tune of 11,523 tonnes. A substantial portion of electronic components come from Taiwan and mainland China to serve the needs of companies located in areas such as the electronic manufacturing hub of Sriperumbudur.
     The initiative highlights the importance that is being attached to the South Indian city as a cargo hub. The airport has been receiving 36 freighters in a month and China Airlines is not the only carrier that was keen to land in the city. In the middle of March this year, a B747-400 cargo aircraft of Air China Cargo Company landed in Chennai from Shanghai’s Pu Dong International Airport. That was the first cargo aircraft route to South Asia and Southeast Asia launched by Air China Cargo.
     The operation of the freighters has enhanced the transport capacity of Air China Cargo into the Asia Pacific market while linking the two important industrial cities of Chennai and Chongqing with North America, Europe, Japan, and Asia Pacific destinations using the Shanghai hub.
     The entry of China Airlines and Air China Cargo comes at a very crucial juncture. A number of carriers have been interested in enhancing flights to the country’s southern cities. Cathay Pacific cargo, for example, has recently started services to nearby Hyderabad after starting freighter flights from Bengaluru last year.
     ACC started the services to Chennai as a part of its plan to fill some of its new main-deck capacity. It obtained approval for the Shanghai-Chennai sector and aimed to fly the route three days a week. Titus Diu, Air China Cargo’s COO, was quoted saying that ACC had planned to send the Chennai flight to Chongqing. Indeed, the return leg of the flight from India to Shanghai does touch Chonqing.
     “We can carry cargo from India, plus we can feed traffic from Chongqing to our intercontinental departures out of Shanghai,” Diu said. Elsewhere in Asia, ACC has been ooking at Dhaka, Singapore, and Ho Chi Minh City.

     Taking air cargo to the next generation. Turkish Cargo top management met recently in a lively session with university students from Bahçe ehir, Beykent, Bilgi, Fatih, Galatasaray, and Istanbul, Istanbul Teknik, Kadir Has, Koç, Maltepe, Marmara, and ve Sabanc¦.
     At the meeting held in Istanbul at Turkish Airlines headquarters, Turkish Airlines Cargo President Ali Turk (center) welcomed the students with a detailed presentation, including an inside look at the air cargo business, followed by an extensive Q & A session.
     “Here is where many of the future business and social leaders are developing,” Ali Turk said afterward.
     “It was good to reveal to a new generation the exciting Turkish Cargo story and especially welcome to see their interest from the many excellent questions.
     “I’d say we all learned something,” Ali Turk declared.

 



 

     Rising ocean freight rates and fuel surcharges are threatening sea-air cargo volumes on Asia-Europe lanes.
     John Cheetham, Regional Commercial Manager of Asia Pacific British Airways World Cargo, said sea-air was becoming less attractive because shippers were not prepared to pay fuel surcharges for both modes. “The savings are smaller now than in a low-fuel environment,” he added.
     Shippers and forwarders use sea-air options on both Asia-Europe and Transpacific trade lanes with airports such as Dubai, Kuala Lumpur, Incheon, and Miami used to deliver exports from China into the major consuming markets on the air-leg. While some shippers build their entire supply around sea-air deliveries, others move between modes depending on relative costs and their ability to cope with changing lead times.
     Spot rates on Asia-Europe have almost tripled to USD $1,934 per TEU in early May from the record lows of USD $490 per TEU in the first week of December 2011. According to shipping analyst company Alphaliner’s latest survey, Bunker Adjustment Factor surcharges levied by lines increased from an average of $606 per TEU in March 2011 to $827 per TEU this month.
     Airline fuel surcharges have also seen significant increases over the same period, with most carriers increasing surcharges by at least 10 percent.
     Claus Schmidt, Managing Director for the Middle East at Swiss forwarding giant Panalpina, which uses the sea-air model via Dubai extensively on Asia-Europe routes, said that the impact of double fuel surcharges had previously been negated by low sea-freight rates to Dubai, but rising sea rates had changed the equation with sea-air now mostly used as an upgrade on ocean to shorten transit times.
     “This is in comparison to the past when high air freight costs forced shippers to look at sea-air as a cost effective alternative,” he added.
     However, Schmidt said that although the double fuel surcharges were having an impact, General Rate Increases by shipping lines remained the biggest threat to the sea-air mode of transport, which he still insisted offered time and cost savings to customers as well as access to new markets in the Middle East and Africa.
     “Transit times for sea-air shipments are almost halved when compared to moving the goods via sea only, whereas from the costs side, savings can be between 25 and 50 percent depending on origin when compared to pure air freight.
     “Sea-air volumes greatly depend on the level of direct air freight rates and capacity. That is, in times of high air freight rates and limited capacity combined with slow-steaming ocean carriers, the volumes of sea-air will generally increase.
     “Due to the volatility in air freight rates during the past years, sea-air volumes have varied greatly, and we believe they will continue to do so.”
SkyKing

Delta Cargo has ramped up tracking action for Express and Premium shipments—now you can tune in online anytime and view exact locations, check temperatures and learn other stuff… like whether or not somebody left the lights on.
Talk about feel better fast.
More: www.deltacargo.com.

 

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