Vol. 11 No. 5                                  #INTHEAIREVERYWHERE                                           Wednesday January 16, 2013


t’s that time of year again. Awards announcements, nominations, and events are flooding websites and email boxes all over the air cargo world. Trade publications (most in conjunction with trade shows) and industry organizations are all promoting awards-related solicitations, whether it be for votes, sponsorships of awards, or dinner seats for the actual awards ceremonies.
     There are awards for company of the year, person of the year, most influential, and lifetime service.
     The idea of recognizing and awarding exemplary effort is nothing new; in fact, handing out awards is as old as organized business itself.
     First of all, everybody appreciates recognition for a job well done . . . and there are plenty of deserving efforts that should be recognized.
     But we believe that there are too many awards.


     It really gets thick when companies run “vote for us” advertising as an integral part of their marketing campaigns. Since when did soliciting for votes equate into bonfire excellence in service?
    One vaguely off-putting result of the race to awards is winners running full-blown advertising programs of their awards with organizations that gave them the honor in the first place.
    Forgetting everything else, isn’t there something a tad less believable going on here?
    Advertising programs, event sponsorships, and tables to attend a gala sold as part of an awards package are a set up, period.
    The guys on the street here in New York City would call it payback, pure and simple.
    Hard working companies and people in air cargo don’t need that kind of grief at what should be a moment of enlightenment and reflection for a job well done.


     A highly placed air cargo executive who asked to go unnamed thinks that awards committees need to look a little closer as they go about the business of recognizing true winners:
     “We think too much of our senior teams and not enough of the people making it happen every day at the terminals, sales offices, and GSA locations.
     “Air cargo needs to recognize the great job all our people do to make this industry successful.”
     “Maybe there should be some new award categories to include a broader spectrum of people and businesses.
     “There are plenty of other categories that could and should be considered outside of the aforementioned ‘narrow band’ of award recipients as the industry gears up for 2013.”
     Another top executive in air cargo (unnamed) thinks awards should come in part from customers with some benchmarking:
     “Performance should be based on profitability and the views of our customers.
     “They should decide who is performing best and we should use more analytical methods, such as Cargo 2000 or other industry resources, to measure performance.”
     We think that the best reward is telling the story, because the words bring out the people and thoughts that make a real difference in the industry.


     If we are to believe awards are legit, we think a great deal more openness and transparency is needed in the awards process.
     No doubt that there is plenty of constructive thought out there when it comes to the giving and receiving of air cargo industry awards.

     Actress Sally Field immortalized the acceptance speech in 1985 when she was awarded Best Actress in the film Places In The Heart.
     Ms. Field (who is again nominated for an Oscar in 2013 for her role in the movie Lincoln) gushed, "You like me! Right now you like me!” Those sentences became a punch line around the world.
     Billy Wilder, the great German-born movie director whose 100th birthday was celebrated in 2007, (he died in 2002 at 95), uttered the best quote ever about awards.
     Among the masterpieces Wilder directed are "Some Like It Hot", "Sunset Boulevard", and the equally great and somewhat overlooked "One, Two, Three".
     Wilder said:
     “Awards are like hemorrhoids: once in a lifetime every asshole gets them.”




     However, there is one award that has long legs in air cargo history, and that is the TIACA Hall of Fame.
     Whether you agree with who has won that recognition (and there seems to be a requisite number of recent winners who are also supporters of the organization), the TIACA HOF is a one of a kind sanctuary for some air cargo builders who have done some truly great things and otherwise might have been forgotten to history, like the wonderful Walter H. Johnson, Siegfried “Siggi’ Koehler, Robert Arendal, Ram Menen, Bill Spohrer, Joseph Berg, John Emery, Jr. and others.
     The most appealing aspect of the TIACA Hall of Fame is that the inductees are chosen from the people attending almost every air cargo industry gathering, including TIACA events.


     Of course a gaping overlook in the TIACA HOF scheme (and everywhere else) is that, to date (in TIACA’s case), not a single woman has made it to the HOF.
     But that said, hope for equality, or at least balance, springs eternal, as does a long list of excellent choices at the point TIACA gives women the vote.


     We close our annual awards tirade raising one more point:
     Why not bring back some vestige of the triumphant and beautiful grand trophies that were awarded during the first generation of aviation? It might make some of these awards worth winning.

Great Trophies of Aviation
  Pictured left to right—The Harmon Trophy came into being in 1926 when Clifford B. Harmon, a wealthy sportsman and aviator, established three international trophies to be awarded annually to the world's outstanding aviator, aviatrix, and aeronaut.
  The Harmon Trophy—the aviator's award—is given for the most outstanding international achievements in the preceding year, with the art of flying receiving first consideration.
  The Bendix Trophy for cross-country races, sponsored by the Bendix Corporation, begun in 1931. The award was established to encourage aviation progress. Winner of the first race was Major James H. Doolittle who flew from Los Angeles to Cleveland, Ohio at an average speed of 223 miles per hour.
  The PulitzerTrophy, established in 1920 by American publishing magnate, Ralph Pulitzer, who created a speed contest to encourage U.S. designers to build faster airplanes.

     The Bendix, Harmon, and Pulitzer Trophies are magnificent works of art and testimonies to the beauty of the Art Deco period. Gorgeous honorariums, they were given to the likes of Doolittle, Lindbergh, and later to others who advanced aviation.
     Air cargo should create a grand award that is beautiful, believable, and passed on from year to year to the next generation in the industry.
     There is no doubt the air cargo awards trend will continue. P.T. Barnum, the great American showman who made the Circus and sideshow freaks famous 100 years ago, once said: “There’s a sucker born every minute.”
     Surveying the manner in which the industry creates winners and losers out of hardworking air cargo companies and people, and in some cases even expects folks to pay for that honor, strikes us as just too dumb to be believed.
     Maybe there should be an award for the award givers: “Best Presenter of Dubious Distinctions.” Your move.
Geoffrey Arend

 

 

  raging battle between express majors operating in India (and that includes the likes of multinationals like FedEx, Gati, and Blue Dart, the domestic majors) and domestic air carriers could turn out into a full-scale war.      
     The express majors, under the banner of the Express Industry Council of India (EICI), have leveled charges that the domestic airlines formed a cartel exploiting the levy of fuel surcharge (FSC) on cargo by not applying a rational pricing mechanism for the same. The EICI, the apex industry body of express companies, has written to the Competition Commission of India (CCI) and Civil Aviation Minister Ajit Singh (right) seeking help in the matter.
     According to EICI findings, in the last four years there has been a substantial hike in fuel surcharge, which has not been commensurate to the highly volatile Air Turbine Fuel (ATF) prices. According to Vijay Kumar, Chief Operating Officer, EICI, “What has been surprising is that all airlines have chosen to increase the FSC by the same amount more or less at the same time. This has led us to believe that this action has been taken in concert.” Giving an example, Kumar said as of November 19, 2012, domestic airlines had increased the FSC on cargo by Rs 2 per kg in spite of a marked drop in ATF prices.
     He went on to add that though FSC was designed to “mitigate the fuel price volatility, it has been used as a pricing tool to harm the interests of express companies, freight forwarders and ultimately the end user.”      Kumar also mentioned that internationally, fuel surcharges were benchmarked to an index to ensure that airlines would not charge more when the price went up. At the same time, fuel surcharge was reduced when prices went down.
     Initially, all the airlines had levied a charge of Rs 5 per kg as FSC on May 15, 2008, without justifying the rationale behind the move (one US Dollar is around Rs 55). The FSC was revised by around 15 percent by the airlines in November 2012, even as the industry witnessed a fall in fuel prices from what was prevailing in September 2012, when the FSC was last revised. In May 2008, when FSC was first introduced, the fuel price was Rs 69227 per kilolitre and FSC charged by the airlines was Rs 5 per kg. During the recent hike, “again acting in concert, on November 19, the fuel price was Rs 68397 and the FSC charged was Rs 15 per kg.”
     Anil Khanna, (left) Managing Director of Blue Dart Express, echoed Kumar’s views. He was of the opinion that the airlines had increased the fuel surcharge by 70 percent in 2011 when the price of crude oil was low. At that time, the airlines increased the FSC and since the charges were not explained, it was difficult for the express companies to convince the consumers.
     The express majors have said that the average cost for freight between Mumbai and New Delhi was Rs 7 per kg. Adding FSC and other fixed costs to it sent the price to Rs 28 per kg. Kumar alleged that no other industry adopted such an opaque pricing mechanism.
     The EICI’s allegation received a boost when the Consumer Unity and Trust Society (CUTS)—a registered, recognized, non-partisan, non-profit, and non-governmental organization pursuing social justice and economic equity within and across borders—filed a preliminary information report regarding air cargo cartels affecting Indian consumers with “a request for suo moto action.”
     Perhaps what is important is that CUTS not only highlighted the allegedly anti-competitive cartels formed by domestic airlines, but mentioned international carriers as well. These carriers were overcharging cargo freight in the garb of fuel surcharge, which adversely affected Indian consumers and hampered the economic development of the country. Therefore, said CUTS Secretary General Pradeep S, Mehta, “such activities needed to be investigated by the Competition Commission of India (CCI).”
     The first information report from CUTS listed the steps taken by various countries to put a check on air cargo cartels and urged the CCI to implement timely measure to curb the practice. The lack of any serious action in India on the part of CCI to restrict air cargo transport cartelization had boosted “the confidence of cargo airlines” and was “not helping to restrict the menace.”
     For his part, a pro-active Minister Ajit Singh told his colleague Veerappa Moily, (right) the Minister for Petroleum and Natural Gas, that the oil marketing companies—all of them incidentally government owned—were indulging in cartelization of ATF. It was then decided that the government would bring aviation fuel under the Petroleum and Natural Gas Regulatory Board (PNGRB). When that happens, the Board would be able to monitor pricing of jet fuel and initiate corrective action if it felt there had indeed been cartelization.
Tirthankar Ghosh


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