Vol. 10  No. 13                    WORLD'S MOST LOVED AIR CARGO PUBLICATION SINCE 2001                       Friday February 11, 2011

Joe Lawrence Keeps It Simple & Direct

     You ask Joseph D. K. Lawrence, President of Airline Services Inc., (ASI), a simple question such as, “Why did you hire John Ryan, the likeable, iconic air cargo sales and marketing guy who helped put Virgin (Airways) Cargo in business in the USA?” and amazingly, in this hyper-complicated world of 2011, Joe keeps the answer simple, straight and direct.
     “We have the network, the experience and plenty good reason for airlines and others to choose our services.
     “John closes the circle and will bring ASI to a new level of recognition in the USA.”
     It’s no secret that the change after the financial crises benefitted Canadian banks, which on the whole appeared to be in better shape and able to leverage their strength to expand into the U.S. (TD Bank is a good example).
     But perhaps what was lesser known was the opportunity enjoyed by ASI—a stable, growing, Canadian-based air cargo company—after both the financial crises and heightened U.S. security demands.
Airline Services Inc., with a broad client list across Canada (including giant UPS) has actually been a recognized cargo GSA since 1989.
     “We were established in Ontario, Canada,” Joe Lawrence said, adding, “and have expanded our coverage to include Quebec, Alberta, British Columbia, Manitoba and the Maritimes.
     “Our service expansion in the USA commenced in 2004 with our U.S.A. head office located in New York.
     “Since the expansion, our service coverage has grown to include California, Texas, Illinois, Florida and Washington, DC.
     “ASI represents large international, regional and national airlines and we currently have a customer database of over 700 forwarders and agents.”

“My view is that there will be greater security demand ahead and continued uncertainty as to what will happen next."

     Airline Services has its principal office located in Mississauga, Ontario with regional offices in Quebec, British Columbia and Alberta.
     “Head office in Mississauga covers Ontario, Manitoba and East Coast Provinces while the Montreal office covers operations in Ottawa and the rest of the province of Quebec.
     “ASI's presence in Vancouver in Western Canada is further strengthened by its office in Alberta, which coordinates all cargo sales and marketing activities with the regional office in Vancouver.”
     We learned the company has further expanded recently by developing partnerships for a growing service package to the India subcontinent and also far-east markets.
     Joe Lawrence began his aviation career at Wardair, which he still describes as “Canada’s finest.”
     Lawrence spent 12 years as Wardair chief of sales and marketing.
     “When Max Ward decided to sell his company to Canadian Airlines, I simply thought it was time to move on rather than be part of a bigger airline.
     “I went into the GSA business having learned the ropes at Wardair.
     “Part of my job there included responsibility for appointing GSAs.
     “So I had learned the GSA business fairly well-or at least I thought I knew what it takes to be a good GSA from the inside out.
     “The big surprise when I landed on the outside of the airline, that actually surprises me even today, is how reluctant, even resistant, some companies are to change.
     “A big part of our job is to convince people how much money can be redirected to the bottom line by going with a capable, strong and engaged GSA like Airline Services Inc.
     “We understand both sides of the business.
     “Many of our people, myself as mentioned and John Ryan, plus other team members of ASI, have been on the front lines of the airline and the freight side of the business.
     “We know what needs to get done and we make it happen.
     “Our success is connected to honesty, integrity, being straight forward, keeping it simple and, above all, letting everyone know what to expect.”
     Joe Lawrence hails from Sri Lanka.
     He left the country in 1975 to seek his fortune in the new world, eventually landing in Canada.
     With the aforementioned expansion to India (Bombay & Mumbai, where pharma is booming) ASI has also moved to Sri Lanka, but Joe is quick to point out that “they came looking for us.”
     Joe also says the future of his former homeland “hinges on stable government that in turn will attract investment.
     “Today, a fair amount of clothing is manufactured in Sri Lanka and business in tea, rubber, semi-precious stones, spices and handicrafts keeps things moving from there.”
     But it has not always been beer, skittles and good times for Joe Lawrence. He admits the financial crises had a negative impact.
     “The year 2009 was the toughest for us.
     “There have been other crises, but 2009 was the worst.
     “Last year was much better and 2011 feels better still as business and economies all around are picking up again.
     “From a Canadian perspective, our economy has been much stronger than the U.S. all along.
     “Our banks were not exposed to the losses suffered in the U.S. and today even Canadian banks are quite strong as compared to many in the U.S.A.
     “The Canadian real estate market also has been strong as a backbone to the overall economy.
     Perhaps one indication of just how good an organization ASI was and continues to be is that the company has served as GSA for United Parcel Services (UPS) in Canada for the past 19 consecutive years.
     “From an airline and air cargo perspective, UPS is always ahead in terms of technology and process.
     “UPS continually refines and upgrades to conform to rules and regulations.
     “UPS is very demanding, but that keeps us on our toes.
     “The core business of UPS in Canada is small package, which requires a special brand of commitment and attention all around.”
     Looking ahead, Joe Lawrence sees plenty of room to grow.
     “Our focus is to provide the customer a single source, one-stop menu of services to every nook and cranny of the world.”
     Taking the industry view, Joe Lawrence has some ideas.
     “The entire process of how we do business is changing, especially from, say, the TSA view.
     “Security challenges every aspect and part of air cargo and affects everybody.
     “These challenges are especially difficult because security demands are also roadblocks to doing business.
     “My view is that there will be greater security demand ahead and continued uncertainty as to what will happen next.
     “Once upon a time we could truck cargo out of Canada to the U.S.A. and put it on any aircraft, either passenger or freighter.
     “Today I cannot do that unless we meet all the TSA requirements.
     “The result is that costs skyrocket, creating big downward pressure on the bottom line.
     “Another result of the continued downward cost pressure of security is that international airlines and shippers are looking for alternatives including, for example, Air Canada, which has increased its direct flights to some destinations, including Latin America, bypassing Miami.
     “Part of the problem is as plain as trucking air cargo to Canada via Buffalo, New York or Detroit, Michigan—two heavily trafficked crossing points between the two countries.
     “It seems no matter where you cross the border, the local U.S. Customs office will have not only the rules, but also their own interpretation of how rules are implemented.
     “That situation, by the way, was going on before TSA and mandates and has only gotten worse since last summer’s 100% screening demand.”
     About efreight:
     “Our business still generates too much paper.
     “The problem is that countries’ and companies’ methodology varies greatly, so demand for providing paper freight continues.
     “At the end of the day, lack of widespread agreement on common systems impedes accelerating paperless cargo.
     “For example, recently we had some cargo moving via Miami to Central and South America, but the demand from the carriers on one side was for original documents and manifests, which should not be an issue in a paperless environment.
     “So while we keep talking about these things, as long as everyone has a different mandate to fulfill, there is doubt paperless cargo can ever be achieved.
     “IATA, which started out strong for efreight, seems to have lost its focus, as the case has not been effectively made advancing the virtues and the value of paperless cargo.
     “If IATA is supposed to be the governing body of the airline business, we can only wonder why it has not implemented benchmarks for paperless cargo?”
     Joe Lawrence states that during 2011, he will hit the air cargo trade show trail, attending events in various parts of the world.
     “Building workable change that benefits everyone begins with plenty of getting-to-know-you face time,” Joe Lawrence says.
e-mail: joe@asi.com

Egypt Looking Ahead

The situation in Egypt continues to be precarious.
     An embargo was imposed most of last week and the week before. It just got lifted but mostly for day-time flights. There is apparently no service permitted at night.
     Exports from Egypt have come to a standstill.
The few imports mostly on belly space are by and large medical and essential drugs.
     It looks as long as this status quo continues we may have an on/off situation.
     Some airports are sitting on backlogs.
     What should companies prepare for? Well, wait and see what happens and when things start to normalize, the first thing which is likely to take place is the influx of the much needed supplies and the clearance of back logs.
Not to forget the exportable items, which will need to move.


MNG Goes Istanbul-Tripoli

     Turkish air freight carrier MNG is re-shaping its business model by boosting scheduled flights.
     In 2010 network flights contributed approximately 15 percent to the airlines’ total turnover of an estimated USD$120 million dollars, while dominant ACMI leasing arrangements accounted for about 70 percent.
     Ad-hoc charter missions flew in the difference. “Until 2013, we intend to up the line-haul share to 35 percent,” announced MNG’s Managing Director, Sedat Oezkazanc (right).
     The plan will be set into practice step-by-step, first with the commencement of scheduled flights between MNG’s home base, Istanbul Atatürk Airport, and Tripoli in Libya in mid-January 2011.
     “Big Turkish construction firms are heavily engaged there, so it makes much sense to integrate the Libyan capital into our network,” states the airline’s Commercial Director, Arslan Kavgaoglu (left).
     Next on the agenda are additional flights to Hanover in northern Germany that will begin in March. They complement the current thrice-weekly frequencies to Cologne with A300F equipment.
     “We see no problem filling the Hanover freighters,” says Managing Director Hakan Ikizoglu (below right) of Frankfurt-based general sales agent Aviation Consultants & Services GmbH (ACS), who is responsible for marketing      MNG capacity in Germany and the neighboring countries. According to Ikizoglu, the Cologne flights are constantly fully booked.
     “That’s why we highly appreciate the additional capacity with the upcoming twice-weekly Hanover services.”
     This will further increase the carrier’s market share on air freight volumes between Germany and Turkey, which currently stands at 26 percent. The biggest competitor on this rapidly growing trade lane is state-owned Turkish Airlines due to their many passenger flights between both countries and consequently their vast lower deck capacity offering.
     From March 2011 on, MNG will serve Dhaka in Bangladesh twice a week with intermediate stops either at Karachi or Mumbai. In addition, Baghdad and Erbil in Iraq are also on MNG’s line-haul agenda, says Oezkazanc.
     Next major leap is scheduled for 2012, when the cargo carrier will receive two brand new A330-200 freighters. They will mainly be deployed on routes to Shanghai and Hong Kong and most likely some destinations in Southeast Asia that still are under consideration.
     Currently, the 1996-established carrier possesses a fleet of eleven units – seven A300B4, two A300-600F, and two B737-400F. The Turkish capacity provider owns all the aircraft.
     “We are trying to purchase an additional A300F as soon as possible, but there are none available in the market,” says Director Kavgaoglu.
     Instead, the airline acquired the Slovenian company Solinair that focuses on cargo operations. It was a clever move since Slovenia, unlike Turkey, is part of the European Union.
     “Due to our Ljubljana-based subsidiary Solinair, which possesses a Slovenian AOC, we can offer charter operations within the entire EU,” states Oezkazanc.
     MNG thus circumvented a big obstacle set by Brussels and the European Aviation Safety Agency (EASA) by demanding that European carriers have to be prioritized in case charter flights are conducted. Only in circumstances where the EU carriers are not able to do so or cannot offer sufficient capacity can non-European carriers jump in to do the job.
Heiner SiegmundFlossie

India Builds Pharma

     The pharma sector in India is expecting whopping growth in the next few years. Air Cargo News FlyingTypers reported some time ago about the growth (India Pharma Sky High) and recently that growth took off when Pharma Zone — a dedicated cargo handling zone exclusively for pharmaceutical products — was inaugurated at Hyderabad’s Rajiv Gandhi International Airport.
     Hyped as the country's first airport-based, dedicated pharmaceutical cargo storage and handling facility, the Pharma Zone is a joint venture between Hyderabad Menzies Air Cargo Private Ltd. (HMACPL), a unit of UK’s Menzies Aviation, and the operator of the Rajiv Gandhi International Airport, GMR Hyderabad International Airport Ltd. (GHIAL). While GMR holds 51 percent of the stake, Menzies has 49 percent.
     Inaugurated by Kiran Kumar Grandhi, (right) Business Chairman, Airports, GMR Group, the Zone has the capacity to handle 3,600 tonnes annually and will be able meet the projected requirement of 7,000 tonnes next year and 30,000 tonnes by 2015-16.
     According to GHIAL CEO P. Sripathy and HMACPL CEO Paul Smith, around 70 percent of the export cargo from Hyderabad comprised pharma products. The state-of-the-art temperature-controlled facility had been designed so that pharma products like bulk drugs, raw material, formulations, medicines and vaccines could be handled safely. The first airport-based dedicated temperature-controlled pharmaceutical handling facility in the country, there are chambers with temperature ranges from 2-8 degrees C to 15-25 degrees C—both in sterile and non-sterile zones. Additionally, some of the Zone’s features include temperature tracking and monitoring with SMS, e-mail and audible alarm system and office facilities for customs, and drug controller for rapid clearance.
     Soon after the inauguration of the Pharma Zone, Lufthansa Cargo and GHIAL signed a memorandum of understanding to jointly develop the airport into a major Asian cargo hub for the shipment of temperature-sensitive pharmaceutical products. Lufthansa operates two weekly flights from the airport and is the only international carrier to do so.
     According to the Memorandum of Understanding, a modern infrastructure will be established at the airport to meet the complex requirements of reliable, temperature-controlled transport solutions. Under the terms of the partnership, Lufthansa Cargo will provide the capacity for the transport of temperature-sensitive cargo.
     In fact, looking at the demand for pharma products, for the first time Lufthansa has planned to station its Opticoolers, which it showcased last August, outside Germany, at Hyderabad airport. Martin Schlingensiepen, (left) Vice President Product Management at Lufthansa Cargo, speaking at the signing of the Memorandum of Understanding, said, “India is the world’s largest market for generics. The demand for temperature-controlled transport will continue to grow substantially in the coming years. A strong partnership with GMR Hyderabad International Airport will enable us to offer our local customers a tailor-made product for the fast and reliable transport of pharmaceuticals.”

     They call it “advantage through technology“ at car maker Audi.
     Lufthansa Cargo’s jewel is the Opticooler, a loading device tailored for the pharmaceutical and high tech industry. The box, built by the German cargo carrier in close collaboration with numerous clients and producer Dokasch GmbH, is able to maintain a permanent temperature of between +2 and +30 degrees Celsius.
     To Read More About Opticooler Click Here.

     -The airport is also wooing Malaysia Airlines Cargo Sdn Bhd (MASkargo), the cargo division of Malaysia Airline System Bhd, to start using the Pharma Zone. Malaysia, incidentally, also has been ramping up its biotech industry.
     Now that Hyderabad is handling around 1.5 lakh tonnes of cargo annually, GMR has plans to develop the airport into a cargo hub for the country. According to the plans, a Free Trade Warehouse Zone (FTWZ) was being developed on 19.8 acres close to the Aerospace SEZ near the airport. The FTWZ will aid logistic companies to store cargo for both short and long terms without attracting import duty.
     Hyderabad’s Rajiv Gandhi International Airport has made astounding progress in the last two-and-a-half years. Commissioned on March 23, 2008, the airport’s cargo complex is now regarded as the foremost in India. It has implemented the concept of an Integrated Cargo Facility housing both domestic and international facilities under one roof. The Air Cargo Complex has a built-in area of 14,330 sq meters with a capacity to handle cargo throughput of 100,000 MT annually. The air cargo section has dedicated cargo apron facilities both for handling regular and freighter operations.
     The airport is building up on the state’s pharma-manufacturing potential to emerge as a global pharma hub. According to ORS Rao, Director, Cygnus Business Consulting & Research, Andhra Pradesh (Hyderabad is the capital) has become the preferred destination for investments in pharmaceuticals for Indian as well as multinational companies. Speaking to Express Pharma magazine sometime ago, Rao said that the state held a dominant position in the pharma industry with 33 percent share of bulk drugs produced in the country. In value terms, the industry was worth $1.6 billion. Andhra Pradesh exports $500 million of pharma products from its more than 2,500 pharma companies.
Tirthankar Ghosh/Flossie

RE: Delta Women Power Cargo

Hi Flossie,

     I applaud and wholeheartedly support your campaign for Women in Air Cargo. I have fond memories of working for CP Air (Cargo) in Toronto in the early seventies.
     When I joined there was not a single female cargo agent in our office. The office was scruffy and the language amongst the team was pretty rough.
     That all changed when CP hired several ladies as trainee cargo agents. Within a very short time I noticed a big change in the office decorum.
     The language used between colleagues improved and so did the state of dress and appearance by the men. It made a huge difference and all for the better.
     However, the term “Women on Top” when displayed on your PC in an open plan office tends to cause more than a few raised eyebrows.
     At least that is the comment I had from a colleague working in one of our larger open plan offices. So perhaps something slightly less provocative on the header would be more appropriate.
     Keep up the good work and keep those Typers Flying.

Kind regards,
Peter Walter

Dear Peter,

      I’m glad that you are enjoying our pieces on Women in Air Cargo. We have worked very hard on these spotlights and are quite proud of the feature and the attention it has garnered.
     It never even occurred to us that the term “Women on Top” might raise eyebrows and be a cause for concern, but I suppose that is a prime example of the types of prejudices faced by women on a day-to-day basis; we don’t need to do anything to receive that kind of attention, except be women!
     I don’t think “Men on Top” would make any reader do a double-take, but the sexuality that is sometimes overtly inflicted upon women makes it difficult not to see a double entendre in every phrase. My one wish would be for women to assert their dominance without the dominatrix. It is an unfortunate dichotomy that exists in our shared subconscious – this idea of women as either sexual, or business-minded, or family-oriented, but never the reality of women as representative of all types of things. Regrettably, these are notions that are deeply embedded in our society as a whole, which makes it difficult for change to be effected quickly, or at all.
     Thank you for your comments, and please, keep writing in!

Flossie Arend

Friday Closer

     A big part of the Super Bowl last Sunday in USA were commercials that cost $3 million a minute or for seconds. Whatever.
    If you have that kind of dough to spend to sell cars and pizza and beer the going rate to a global audience is certainly an almost unimaginable amount of money.
    So we all sat and cheered and laughed at the commercials especially everyone’s most favorite involving a small child in a Star Wars Darth Vader costume zapping a new Volkswagen Passat.
    I mean you had to see it.
    Next to cars of every price, shape and variety, beer commercials were most evident during The Super Bowl.
    But none of the commercials were as good as the one you are about to watch from Japan for Sapporo Beer.
(Thanks to Roy Stapelton President Global Logistics Network (GLN) Contact: rstapleton@go2gln.com)
     The two-minute video unfolds like some animatronic Rube Goldberg drawing come to life.
     Try to watch this ad in a quiet moment Full Screen in HD 720p.
     Although this ad did not run on the 2011 Super Bowl it is better than any we saw, so enjoy the ride.


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