There appear to be two stories emerging from amidst the Qantas chaos over the past weekend, after CEO Alan Joyce took the drastic step to ground all flights Saturday. The impact of the disruption was keenly felt by tens of thousands, including many well to do and influential folks traveling to the hugely popular Melbourne Cup horse race on Tuesday.
     Estimates of 70,000 passengers stranded spurred the government and its labor-market regulator to seek a quick end to hostilities between the airline and unions.
     Joyce, described as a "kamikaze" by Sydney Herald, “for effectively staging his own strike against the unions,” came under fire from all sides.
     Australian Prime Minister Julia Gillard said grounding the airline was an extreme step and criticized Joyce for giving the government only three hours notice before the action.
     "The (Qantas) board should immediately sack their out-of-control CEO," said Captain Richard Woodward, Vice President of the Australian and International Pilots Association.
     The Joyce lock out and grounding action caused Fair Work Australia, an independent industrial relations arbiter, to grant a Federal Government application to terminate all industrial action, bringing a 21-day cooling off period that puts Qantas back in the air by Tuesday.
     If the dispute is not settled, both sides must submit to binding arbitration, a process that is likely to favor Qantas, sources say.
     The Qantas dispute has been an ongoing saga, but when the airline announced plans to cut 1,000 jobs and order $9 billion worth of new aircraft, labor went ballistic.
     Lisa Brock, Qantas Executive Manager Freight, said:
     “Our priority today will be on rebooking freight currently on hand and accommodating existing bookings.
     “Our international B747-400 and trans-Tasman B767-300 freighter services, Jetstar, Jetstar Asia, QantasLink and QF Tasman flights operated by Jetconnect continue to operate as per published schedules,” she said.
     The second story worth noting here, despite the back to work edict, is that labor unions in Australia are getting stronger, driven in part by the aforementioned government-sponsored Fair Work legislation.
     Fair Work has generally made industrial action easier and work places more accessible for unions.
     “With corporate profits generally up in Australia, labor's about due for some muscle flexing as the economy picks up next year,” wrote Michael Pascoe in Sydney BusinessDay.
     “Knowing that something called Fair Work Australia is deciding the Qantas case sounds as reassuring as hearing that Australians For World Peace will conduct a lecture series on Middle East conflict in the Thargomindah School of Arts,” he added.
     All of this has renewed speculation that Qantas’ brand image may be ruined forever, that the airline share price may never recover and lastly that maybe now a takeover of the airline, which was aborted a while back, may once again be on the front burner.
     That being said, late Monday in New York a story was featured on Reuters dateline Sydney with the headline “Qantas Looks Too Ugly For A Bidder.”
     The story suggests that since Qantas has been in several negotiations to sell itself before, right now might be a good time to welcome a white knight.
     “But major labor unrest and limits on foreign ownership overcome the cheap valuation, keeping potential strategic partners and private-equity bidders at bay.
     “And these issues are not likely to be resolved anytime soon,” Reuters said.
     The down under soap opera continues.
     Stay tuned . . .
Geoffrey/Flossie

Worth Repeating

Not only does the Frankfurt night flight ban impair global supply chains, it also penalizes business and consumers alike.

Michael Steen
Executive Vice President Chief Commercial Officer
Atlas Air Worldwide Holdings
Chairman TIACA

     High,Wide & Handsome… First, the mighty IATA World Cargo Symposium was held in the wonderful world city of Istanbul earlier this year.
     Then the buzz at Munich Transport Logistic was all abut Turkish Air Cargo.
     Now as Air Cargo Americas opens in Miami this week, a delegation comes from THY Cargo including (left to right) Ebubekir Kusak, cargo publicity and advertisement manager; Halit Anlatan, vice president sales and marketing; and Ali Turk, vice president operations.
     “We want to greet our old friends and colleagues and introduce Turkish Cargo and the infinite possibilities our unparalleled global expansion of services offer via gateway Istanbul,” said Halit.
     Visit Turkish Cargo at Booths 411, 413, 510, 512 at Air Cargo Americas.

leisure Cargo's Man In Havana & Latin America—Erik Fraenkel

     Erik Fraenkel has been leisure Cargo’s Man in Havana and Latin American for some time now.
     We caught up with Erik recently as he offered an inside look at an expanding and diverse market connecting cargo aboard a growing stable of air carriers that are part of the leisure family.
     “Latin America has been developing quite well for leisure Cargo during the past two years.
     “We have increased our capacities with new carriers.
     “We are building excellent air cargo connections all over the place, but especially into Latin America via Miami,” said Mr. Fraenkel, leisure’s Regional Director based in San José/Costa Rica.
     “Our business throughout Latin America is building on the strength of our worldwide reputation and with the addition of new service partners into the leisure family,” Erik said.
     Erik works for Ralf R. Auslaender, who founded the company on January 1, 2000 for parent LTU.
     Today leisure Cargo as part of the giant Air Berlin is both an important house resource and an ongoing success story for an impressive and growing list of airlines, the majority of which feature either discount or tour-based business.
     Keeping it simple has been job one since this long time cargo executive decided to focus exclusively on a completely overlooked market segment.


Erik and Ralf Auslaender at Air Cargo Europe Munich 2011

     In a nutshell, this “better idea” leisure cargo GmbH provides all carriers represented with full logistical know-how, from sales and handling contracts to road feeder services, on a worldwide or regional basis.
     Erik, however, sees great advantage to focusing on a part of the world that is moving from sleeping giant to center stage.
     “Our business concepts are very well accepted, we have been increasing our capacities and capabilities across the region and we have also been successful in establishing good working partnerships with our customers and other carriers throughout Latin America.
     “For example our partnership with DAE, a regional carrier based in Curacao, has worked well as a feeder from Colombia and Ecuador into leisure partner Arke Fly network that, among other places, of course serves Amsterdam.
     “Also, the Air Europa that came on about two years ago as a leisure partner carrier for our total cargo services program has impacted our business flying, mainly into Argentina, Peru where the exports have just been outstanding.
     “We are moving over a million kilos a month out of Peru with five A330 weekly flights, including perishables such as asparagus and mangos, to Spain and elsewhere.
     “Our presence in the market is long standing, as prior to carriers such as Air Europa we were already offering off-line services via Air Berlin Miami flights.
     “So our established relationships are now moving to the next natural step with the opportunity to offer direct service to many Latin destinations.”
     Erik Fraenkel is a twenty year veteran of the air cargo business.
     In addition to DAE and Air Europe in Latin America, he is the point man for the cargo operations of Condor, Air Berlin, Arke Fly and 19 other carriers that are part of the leisure Cargo family.
     He has been with leisure since LTU and the beginnings of the “total air cargo solution” concept, meaning that when this well-seasoned air cargo executive went to work he was building his business from nothing, right from the ground up.
     His office base is Costa Rica, which is currently expanding staff to handle all manner of activities as business continues to build.
     “Our secret is really no secret at all.
     “We stay in touch with all our customers, staying close to GSAs whilst making sure that all customer needs and expectations are well satisfied.”
     We wonder if there are some things that Erik might like to see develop ahead.
     “Obviously the capacity leisure is bringing across the market is affording us opportunities to build our services like never before.
     “We are looking at freighter feeders and de-feeders in some areas to interface with our main-line flights—Colombia to Curacao, for example—to feed Arke Fly back to Amsterdam; Mexico to Dominican Republic to interface with our 50 weekly flights that we have into four gateways in the Dominican Republic.
     “Upgrading communications is also a top priority right now.”
     On a to-do or wish list, Erik confides:
     “I would like to rebuild our hub in Caracas, Venezuela with cargo from Colombia.
     “Strictly speaking, Venezuela is not an exporting country, but our services there and one way traffic into the country can be developed for air cargo.
     “leisure Cargo, it should be mentioned, is a lean operation and quite easy to adapt to any situation.
     “There are not layers of people at leisure, so we get to issues and solutions quickly.”
     “Through the leisure Cargo network we offer Latin shippers 175 destinations and via our hubs in DUS, AMS and UK we can basically connect easily with anywhere in the world.”
Geoffrey/Flossie

Stop By leisure Cargo's booth 520 at Air Cargo Americas

      Light weight instead of heavy equipment. What sounds easy is indeed quite a challenge when it comes to implementation in today’s air freight handling processes. But changes seem to be around the corner – triggered by a number of surveys displaying astonishing results.      According to data collected at a number of cargo warehouses around the globe, only a surprisingly meager three percent of all cargo pallets built by handling agents or airlines weigh more than 3.3 tons. This means that 97 percent—the vast majority—of unit load devices are lighter. Nevertheless, criticizes expert Oliver Schaaf, the entire storage system, stackers, and hoists, together with heavy machinery like elevator transfer vehicles (ETV), which maneuver through the halls moving shipments, are way oversized for most of the throughput. “They all are designed for payloads of up to 6.8 tons,” says the managing director of cargo consultant Realog GmbH.      This outdated ‘heavy instead of light’ philosophy leads to excessive costs, wasted energy and unnecessary greenhouse gas emissions, he says, citing surveys.
      In fact, air cargo terminal technology has basically not changed much during the last twenty years. Both designs and mechanical layouts are based on IATA’s propagated maximum ULD loads of 6.8 tons. This convention has been carved in stone for long. As indispensable as it is for carrier load assessments, it is, however, of no or only very limited use for most of the storage processes on the ground.
      What’s urgently needed is a new generation of “green” cargo warehouses, including major changes in handling processes, says Schaaf. Consequently, his Realog developed a new generation of cargo handling and storage equipment systems configured for payloads of up to 3.5 tons. The central idea of the concept, which is based on a pending patent at the German Patent and Trade Mark Office, DPMA uses the lightest possible but most durable components for building stackers, racks or roller beds, including lightweight designs for walls, floors and warehouse roofs. Once a ULD is built, automated transfer vehicles securely store it at a special section within the facility. “This enhances security since machines do the work with nobody being allowed to enter this specific module of the warehouse,” says Schaaf.
      After designing both Emirates’ Mega Terminal and the Flower Center at Dubai airport, the 47-year-old pundit is well acquainted with the needs and problems of today’s handling tasks.
      Taking into account the 3 percent versus 97 percent classification of ULDs, Schaaf advocates for splitting the load devices along this line and processing them in different handling facilities: the small number of heavy shipments in a tiny section of a warehouse, the lighter weight, vast majority in a bigger, adjacent space. The storage system, racks or hoists of the latter, he says, can consist of light metal or synthetic materials instead of steel. “The design and daily operational functioning of this light construction solution is already demonstrated, says Schaaf, as illustrated by the automotive industry as a forerunner. “What’s good for them can also be very beneficial for the aviation sector.” If his classification concept is realized by handling agents, the overall savings of up to 30 percent can be realized.
      Schaaf himself might substantiate this calculation in the near future at Frankfurt airport’s cargo city north.       There, Lufthansa Cargo projects a brand new and huge distribution center for air freight, substituting the aging facility built more than twenty years ago. Last August the carrier and Schaaf’s Realog signed a framework agreement for strategic consultancy pertaining to the proposed air freight terminal.
Heiner Siegmund/Flossie

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