Vol. 9  No. 108                                                     WE COVER THE WORLD                           Monday September 27, 2010

 

     Air India is all set to get its house in order. All that the carrier is waiting for is a nod from the government, which is planning to inject a whopping Rs 1,200 crore for the revival of the financially crippled airline. The green signal from the high-level government body, the Cabinet Committee on Economic Affairs (CCEA) (in fact, it is headed by Prime Minister Dr. Manmohan Singh) will kick-start operations of the airline’s six Strategic Business Units (SBUs) comprising cargo: Maintenance, Repair and Overhaul (MRO); ground handling; engineering; low cost airline; and related business.
     When Air India and Indian (Airlines) merged in 2007 and the National Aviation Company of India Ltd (NACIL) was set up, it had been decided then that the six SBUs would generate their own incomes and turn into separate profit centers.
     As for cargo – once a major revenue earner for Indian (Airlines) as well as Air India – the NACIL management made the decision to use its subsidiary carrier, Alliance Air, as a dedicated cargo carrier. Alliance Air is now known as Air India Regional. It was set up in 1996 and operates quite a few flights to small cities. In fact, post-merger, the idea of converting the carrier was put up to the civil aviation ministry by the airlines top brass.
     At the moment, Alliance Air has 25-odd destinations on its short-haul routes that it covers with a fleet of 15 planes, among which are a few Boeing 737s, ATR-320s and Bombardier CRJ-700 ERs. All the planes are scheduled for conversion to freighters. It had a few Boeing 737-200s, all of which were converted and transferred to Air India’s cargo division. Incidentally, the cargo section has a fleet of 10 freighters operating to a dozen national and two international destinations.
     The major reason for turning Alliance Air into a freight carrier was the age of the carrier’s Boeings.      According to the Directorate General of Civil Aviation (DGCA), old planes cannot be used for passenger services. It is also a fact that the carrier has not been making any money. Hence, it makes sense for Air India to turn Alliance into a dedicated freight carrier.
     Among the other measures that Air India proposes to turn the company around is offering stock options to its 33,500-odd employees. Although no details have been worked out yet, the employees are already up in arms. The employees unions are believed to oppose the stock option move.
     For the record, official estimates have put Air India’s loss to be around Rs 5,700 crore in 2009-10. In 2008-09, the loss was around Rs 5,550 crore and in 2007-08 it was Rs 2,230 crore.
Tirthankar Ghosh


     Every year we celebrate Memorial Day in the USA, the official start of Summer and this year it was also the 66th year marking June 6,1944—D-Day in France.
     While these occasions are noted and exploited with almost non-stop military programs on certain TV channels, as the new century progresses some perspective might be useful.
     Today, modern air cargo of the USA Air Mobility Command routinely moves all manner of goods and troops to various theaters of war with the kind of regularity usually associated with civilian overnight services, and in volumes that actually dwarf some of the more famous mass freight movements in history, including the China India Burma Hump fliers of World War II and The Berlin Airlift of 1948.
     It is true that those early movements electrified the world by their vision and execution and were pioneer efforts that inspired the birth of a great industry.
     But right now in Southern Afghanistan, for example, they are building the foundations to both create and support a major buildup of USA troops that in large part will be initiated and supported down the line from the air.
     Any number of USA flags who are part of the CRAF program are utilized to move troops and critical supplies to and from the USA to forward bases in both Iraq and Afghanistan.
     That task was made quite a bit easier earlier last year when the USA and Russia agreed on a plan that allows USA military troop and supply aircraft to overfly Russian Federation airspace.
     The agreement saves about $140 million in fuel costs annually and insures safer passage in and out of the theaters without having to move overland through Pakistan, where attacks have been attempted and truck convoys are easy targets.
     Dubai also plays a large figure in the movement of hard cargo and other supplies into Iraq and Afghanistan via any number of independent operators, such as Rus Cargo and others, including several small to medium ad-hoc carriers.
     Air cargo into these war zones at times resemble operations that could have been lifted straight from the pages of Terry & The Pirates, a 1930s comic strip that glamorized air cargo flights to far away places like China and India.
     Right now with Dubai as a conduit, all cargo travels daily and around the clock into war zones, and at times aboard vintage equipment.
     Over Afghanistan on any given day are scores of C-130s, their cargo bays holding about six tons of cargo strung with parachutes.
     Although the venerable Lockheeds have served in one theater of war or another in updated versions since Vietnam, they are still on the job in 2010, air dropping supplies for U.S. troops at remote sites, bringing frozen food, fruit drinks, ammunition and spare parts to the front lines.
     The ability to airdrop supplies and land C-130s with cargo on remote dirt airstrips is vital to keeping the war effort in Afghanistan supplied and in business.
     Dispersing the troops safely is a key element of the strategy that will add 30,000 more of their numbers to provide security for Afghanistan's population, which is scattered in thousands of rural villages, dusty crossroads and deep mountain valleys.
     There, the roads are also too dangerous to convoy supply trucks, as attested by loss figures gathered by the US Pentagon.
Bandits and hostiles make over the road more like over the rainbow.
     In best case scenarios, even in good weather it takes an average of three weeks for a truck to move from Bagram Air Field, where cargo flights arrive from the U.S. and Europe, to Kandahar, the staging base for allied forces in southern Afghanistan.
     In winter, a road convoy can take twice as long.
     Today, the skies above Afghanistan are alive with C-130s, jet fighters, unmanned drones, commercial 747 cargo aircraft, transport and attack helicopters and even occasional artillery shells.
     Air Cargo moves in a never ending ballet amongst all traces of combat and commerce, bringing hope and deliverance to ever growing legions of kids from Columbus, Ohio; Butte, Montana; and Newark, New Jersey, who find themselves at a remote location somewhere in Afghanistan as that conflict drags on.
     In the USA, Defense Logistics Agency (DLA) supply centers and support team logisticians have spent the past several months working with U.S. Central Command and U.S. Forces Afghanistan officials to support additional forces in the country.
     For example, DLA’s supply chains have been involved in the planning effort, including Defense Supply Center Philadelphia, which provides food, construction material, medical items, clothing and individual equipment.
     A key element of the Afghanistan support strategy is the development of the Northern Distribution Network.
     This initiative provides additional routes to move material to troops on the ground through the South Caucasus and Central and South-Asian states.
     Still, geography, the lack of extensive complementary transportation links and minimal security on them will continue to be a major challenge looking ahead at the US military effort in Afghanistan.
     No doubt the book is being rewritten in large part as there are major differences operating logistics chains into Iraq and Afghanistan.
     Looking at both places by comparison reveals:
     Supply chains into Iraq are operated from 'safe havens' for the US in Jordan (where Aqaba has been used) and Turkey for activities in the North.
     In Afghanistan, there is nothing comparable - certainly not on the all-important frontier between Afghanistan and Pakistan.
     Also, in Baghdad the U.S. military has been able to utilize remnants of an international airport with substantial existing commercial infrastructure.
     The legacy Iraqi Airways cargo facility was dated, but better than many seen in developing countries, and you do have some commercial airline activity running in there.
     It is widely felt that there have been some important misjudgments about rehabilitating the Iraq gateway, including granting operating concessions there, but at this point at least it looks doubtful that comparable interests are in place at Kabul.
     Moreover, the surface transportation of Afghanistan is not remotely comparable—in condition, extent or security—to what exists around Baghdad and Fallujah.
     It may seem cliché, but basic common sense holds that superiority in moving troops and supplies has had an undeniable relationship with outcome in wartime.
     It is no small coincidence that the creators of the Roman Roads—guys who recognized that major arteries for troops and supplies should have a peak for drainage, rather than be flat—helped develop a mighty extensive empire.
Geoffrey

 

 

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RE:  Martinair Cuts Pax As Air Cargo Indicted

Dear Geoffrey,

     I have known Meta Ullings for 20 years and if there ever was a charming, brilliant and above all else, honest person, it is she.
     Having spent over 40 years in this business I have seen it all, but the absurdity of this is beyond belief.
     I hope that Martinair stands behind her; as a matter of fact, I hope the entire air cargo community is there for her.
     I don't know how these guys can look at themselves in the mirror; it’s disgusting.
Stan Wraight
Managing Partner
Strategic Aviation Solutions Int'l
stan.wraight@sasi.com.hk

     Thank you dear Geoff, for the good piece on Martinair and specifically on my old and very valued colleague Meta (Ullings)!

Best regards,
Jan Meurer


Dear Stan,

     Thanks for writing.
     Meta was already hung out to dry editorially by the UK media, which was also disgusting—but in 2010, that’s life.
     Now is the time for air cargo to band together and form a special interest group that can hire some lawyers, lawyers who will act as a legal swat team, going to the point of each charge—lawyer vs. lawyer.
     Then maybe these prosecutors might think twice about wielding threats to management, whilst pounding underlings to give testimonies.
     A united air cargo group could stand against this sick enterprise, which creates mayhem and destroys lives in the supposed best interests of law and order, and is controlled by people who basically see easy pickings in air cargo.
     Air cargo is in the cross hairs of lawyers and politicians who are out to make a reputation.
     These so-called watchdog prosecutors triumph because air cargo and the airlines specifically are too busy just trying to stay in business.
     Without push back, this mayhem will continue.
     While we favor law and order, Meta should be the watershed indictment that brings us all to our feet, proclaiming enough is enough.
     Air cargo should open its window and shout:
     "We are sick and tired of all these trumped up prosecutions and will not take it any more!"
     Believe me, politicians and lawyers could not turn deaf ears to a clear and strong band of voices from air cargo.

Good wishes,
Geoffrey



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