Vol. 9 No. 59                                                            WE COVER THE WORLD                                                     Monday May 3, 2010

Call For CNS To Internationalize

     Lufthansa Cargo executive board member, Andreas Otto, makes a case for considering an expansion of CNS (Cargo Network Services), the North American arm of IATA.
     “A joint formulation of the common concerns our industry is confronted with in political debates is essential,” the manager pointed out in his keynote remarks, addressing an audience of 450 delegates gathered at the 2010 CNS Partnership Conference held in Miami on Monday morning.
     “CNS could become a kind of moderator and driving for solving pressing topics shared by cargo airlines, forwarders and truckers,” Herr Otto said. He regretted the absence of a common voice of the industry. This communicative gap could be filled by CNS, as in instances of impending night flight restrictions at major hubs like Frankfort, or security regulations that governments and regulators are currently tightening step by step, without involvement of the industry in their decision making process.
     “Our industry contributes substantially to the global economy, but we lack political and public awareness,” Otto said, his words piercing the source of a fundamental wound in the air cargo business.
     Jo Frigger of EMO-Trans America applauded the manager’s remarks. “Airlines, forwarding agents and truckers should sit at the same table to join forces and deliver powerful demonstration of the industry, especially in Europe,” Frigger commented.
      This implies that IATA would have to redefine the organization’s philosophy by treating forwarders as cargo airlines are treated. “This hasn’t been the case so far,” Jo criticized.
     Hosting CNS President Michael Vorwerk assured that he would bring the Otto proposal right onto IATA’s table for further discussion.
     In his remarks to participants, Otto reminded us all of his first speech at the CNS forum in 2003. Today, cargo is still seen as a side-product. The airline results remain unsatisfying. Due to different impacts, “like Sars, swine flu or the global crisis, the potential growth of the past five years has been lost.”
      When you factor in things like the closure of European airspace due to the volcano and coupled with authorities that were ill prepared, “this shows how vulnerablethe biz is that we are in.”
     Generally speaking, he sees the consolidation trend at cargo carriers gaining momentum. But instead of collaborating loosely like the former WOWM alliance, airlines are now forming legal entities like Air France-KLM-Martinair and Delta-Northwest. LH Cargo follows the same pattern by grouping together with Austrian Airlines Cargo, Swiss World Cargo, Jade Cargo, Brussels Airlines Cargo and BMI Cargo. These partnerships include integrating processes, however, LH Cargo and AUA Cargo have opted to follow Swiss WorldCargo and retain commercial autonomy.
     “Ultimately, it is in our group members’ hands to decide what path to follow – it is not in the hands of Lufthansa Cargo,” Herr Otto concluded at a press conference after his CNS remarks.

     Although everything in Andreas Otto’s life seems quite evenly measured and put together, like many sports fans he leaves much of his passion to chance.
     Last Saturday, Herr Otto’s team, Schalke 04, watched their bid to become National German Soccer champions go to ashes.
     The team lost 0-2 to Bremen and hopelessly trails Munich with only one game left next weekend in the major German soccer league, the Bundesliga.
     After recovering from the unexpected loss, sportsman Andreas values the entire season as extremely positive, with his Schalke club ranking second despite the outcome of the last game.
     “We have to be realistic,” Herr Otto said in an attempt to put his best face forward.
     “Nobody expected Schalke to perform that well,” he said upon arriving at the CNS conference in Miami.
     How sweet it (almost) was.

Heiner Siegmund

Eye On CNS

Together Again,
For The First Time…

From left - Continental Cargo’s Jim McKeon and Jack Boisen flank United Worldwide Cargo VP Cargo Kyle Betterton as word came down Monday that UA and CO are to merge.
     “Adding up the routes and synergies, it looks like one great airline,” McKeon said.
     “Very little duplication, and a great fit all around,” said Boisen.
     “Too bad we don’t have the new logo – we could have set that up in the lobby here for CNS.” (Continental’s famous globe will be retained for aircraft tails, along with the CO color scheme, but the airline will be called United)

    You never forget the sound that the metal gate makes, that clag of finality when you cross into prison to serve time.
     Timothy Pfeil (pronounced ‘File’) understands all too well the kind of downward pressure an ongoing price-fixing scandal can reap on individuals in air cargo.
     Timothy spent six months in U.S. Federal prison, a swift fall from high profile management down to jail cell, and then back up again to the industry. Today he is Vice President of Sales and Airline Relations for Platinum Cargo.
     In a related development Platinum Air Cargo has been named exclusive GSA for Egypt Air in the U.S.  

“I began at Railway Express Agency and eventually moved over to Saudia Cargo,” says longtime industry stalwart, Barry Lennihan.
“I guess I’ve been lucky to have lasted all these years. Now that retirement is on the horizon, I’ll be able to spend time fishing and enjoying the family.
“It’s been a great ride,” Barry assured.

     On a day when United and Continental got married and drove off into the sunset, i.e., “just merged,” DL VP Cargo Neel Shah (l) and his Delta Cargo team hosted a swell evening affair in an outside garden at CNS, outfitted with a pool, waterfall, music, ping pong, lots of great food and networking.
     Shah elaborated: “Our effort has developed a great air cargo resource – customer centric and ready to grow like crazy.”
     “Under Neel Shah, we are adding new destinations and building a Delta Air Cargo that is not only a valuable industry leader but also a major factor in the future scheme of Delta Airlines,” said Ray Curtis (rl), DL Managing Director Worldwide Sales.
     “Building friendships one day at a time,” added Gregory Mays, Managing Director Global Operations.      “It’s exciting around here.”
     Recently Mr. Mays took the story to Frankfurt, where he addressed the meeting of Air Cargo Deutschland Club.
     There were many questions about security and TSA, but most were happy to learn more about Delta Air Cargo.

An Annual Affair

     The Lufthansa Cargo Group Roundtable held at Doral Miami CNS brought members of the press together with an expanding world of airline cargo resources.
     Conversation was bright under the broad blue sky, and only momentarily interrupted by the apt flight paths of low flying planes overhead. The talk surrounded recent and future activities at Lufthansa Cargo, Lufthansa Charter Swiss World Cargo, Jettainer, Austrian, and Brussels.
     Dave Sharma, the old cargo pro, has been filling up the bellies with air cargo from Sabena to Brussels Air, and noted that while it isn’t “the good old days,” the future was bright and always moving forward. Working from a March 31st divorce from American Airlines and new partnership with United, Sharma says, “business is big out of Africa – we are twenty people and 16% of our revenue comes out of Africa.”
     The concentration on Africa is due in no small part to antitrust laws preventing sales in Europe, most of those sales going to United or someone else. Business in Africa has concentrations in both cargo and passengers, and Sharma says, “I don’t know why others aren’t putting more focus on Africa. While cargo going into Africa is no match for cargo coming out of Africa, the area is coming up in much the same way China once was.”

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