Munich China Show A Non-Starter

     The people who attended Transport Logistik in China, a trade show imported from Munich, may have found a few scattered reasons to feel positive about the overall multi-modal experience—these days, even a trip to action-packed China is reason enough—but comments from the recent encounter indicate that the air cargo portion of the event was, at worst, a bust and at best, disappointing.
     “Shanghai was nothing special—some carriers, but not a big scene at all.
     “The air cargo part was extremely small, just half of a hall.
     “It took me 15 minutes to walk through the floor and see the stands.
     “Nothing really outstanding.
     “Also, the bigger air cargo carriers did not show up.
     “ACMI operators like Atlas & World were present with their own booth.
     “We had some good meetings with some forwarders, but I could have had these meetings without the fair.
     “For me, this is the last time I will go to Shanghai for this event.
     “Transport Logistik China is not comparable to what happens every other year in MUC.
     “Munich is truly unique—at a different level from an exhibitor point of view.”
     The question that still remains unanswered is that, with so many excellent international transportation conferences held annually in China, why one from Munich?
     The 4th International Exhibition for Logistics, Telematics and Transport took place June 8-10, 2010, at the Shanghai New International Expo Centre and attracted 13,500 trade visitors from 67 countries.
     There was a 20 percent rise in visitors since the last Transport Logistik China in 2008, which is reflective of the rising demand for transport and logistics excellence, especially in the Asian market. This rise occurred despite a severe downturn in the sector in 2009.
     “Transport Logistik China has come at just the right place and time, as business is starting to pick up again,” said Eugen Egetenmeir, Managing Director of Messe München International (MMI) and organizer of the event.
     The Air Cargo China exhibition, which was held as part of Transport Logistik China 2010, attracted over 50 of the world’s leading airlines, airports, logistics hubs and aircraft manufacturers. In addition to the exhibition, the Air Cargo China Conference also served as a platform for discussing the latest developments and trends in the air cargo business with special reference to the growth market of Asia.
     International CEOs from the air cargo business gave an in-depth overview of the trends in the industry in two discussion panels, pointing specifically to the potential of the Asian market.
     Mr. Sathis Manoharen, Head of Cargo for AirAsia and AirAsia X, Malaysia, introduced a newcomer in tomorrow’s air cargo market—the Low-Cost Cargo Carrier.
     Both the regional AirAsia and long-haul AirAsia X airlines decided that the contribution to the bottom line provided by cargo was not to be ignored, even though a fast turnaround time is essential to the operation of the low-cost model.
     “A low-cost airline could offer air cargo services at competitive rates, and its key advantages include competitive pricing, high frequencies, low cost in the logistics supply chain, service to both primary and secondary markets and finally, no fuel, security and etc. surcharges,” Mr. Manoharen said.
     “However, here are also challenges that a low-cost airline has to face, and some experts say it’s no way!”
     “The low-cost airline not only has to overcome the limitations inherent in short turn-around time, web-based cargo booking and tracing system, and lack of trans-shipment facilities involved in handling perishables, but also has to think about how to interline with other cargo carriers and harmonize passenger and cargo operations,” Mr. Manoharen added.
     Mr Robert Song, (at the podium) Executive Vice President of AirBridge Cargo Airlines in China, introduced “Benefits of a Network Strategy.”
     AirBridge Cargo Airlines is now operating a network strategy connecting China to a worldwide network through a hub in Moscow—a strategy that is enabling this freighter airline to move away from just offering point-to-point cargo transportation.
     “Moscow is an advantageous geographical location between Europe and Asia, and the largest growing consumption market in Russia. It also owns an airport-SVO free from congestion and open for development and expansion.” said Mr. Song.
     “Introducing hub operations in SVO in 2009 resulted in significant growth of cargo throughput, and allowed ABC to realize efficiencies of scale and geography without extension in total transit time.”
     As to China, Mr. Song commented, “Investment going west, logistics to follow.”
     “Congestion in and around China coastal airports will not ease, but worsen in coming years as more passenger flights will be introduced to cater to the needs of traveling public with higher disposable income.
     “Favorable policies in Central China encourage factories (and therefore freighter operators) to explore Western China as the next base of export production and logistics’ development.”
     Mr. Thomas Hoang, Regional Director of Boeing, shared a brief update of Boeing's latest findings and statistics relating to the China market.
     “The decline in world air cargo traffic in 2008 and 2009 resulted in 6years of lost growth.
     “While in the first three months of 2010, the business grew 22.6 percent relative to that of 2009.
     “And China air cargo market will continue to be of significant importance, as its forecasted economic growth continues to lead the world.”
     Other speakers at the panels included Mr. Jason Teo, Infineon Technologies and Chairman of the Transported Asset Protection Association Asia (TAPA); Mr. Gao Pei, Executive Deputy General Manager of China Cargo Airlines; and Mr. Enno Osinga, Senior Vice President Cargo of Amsterdam Airport Schiphol.
David/Flossie

Panalpina's Dixie Pixie

     Sidney Bechet, ‘Satchmo’ Louis Armstrong, Jelly Roll Morton, Bessie Smith: these are just a few of the fathers and mothers of traditional Dixieland Jazz. Titles such as “Basin Street Blues” or “When The Saints Go Marching In” were best selling recordings in the glorious era of Dixieland Jazz. That’s about three or even four generations back, but this early style of Jazz music is still extremely popular and is associated with the southeastern portion of the United States.
     Dixie is also the name of a popular freighter route between Luxembourg and Huntsville, Alabama managed by Swiss logistics giant, Panalpina. This flight will be in the spotlight next September when the 20th anniversary of this service will be celebrated with a big feast at Huntsville International Airport.
      Twenty years of consecutive flying in spite of all the economic downturns—terror attacks in the U.S. and elsewhere, bird flu, swine influenza and their harmful effects on aviation—it’s an unbelievably long time for a single, transatlantic cargo service.
      An Atlas Air B747-400F currently operates on the service four times a week. Capacity purchase contracts with major car manufacturers and their many suppliers, which have set up production and assembly plants in the southeastern U.S. Dixie States, ensure the steady flow of shipments on this route. In the event of sudden interruptions (demonstrated vividly by the volcanic ash clouds floating through European air space some weeks ago), there is the threat that automotive production might come to a sudden standstill due to a lack of components.
     “In Huntsville, we are treated like little kings,” states Lucas Kuehner, Managing Director, Panalpina USA. No wonder, since the Swiss agent is by far the biggest cargo client of Huntsville airport.
     Kuehner attests “Here we are given first class service, be it by the airport people or the local customs authority.”
     The imports are deconsolidated in a rented warehouse that is run by Panalpina. It contains a 500-square meter climate-controlled zone for stowing temperature sensitive shipments. “Since we have constant throughputs of pharmaceutical goods, we need the cool rooms,” Kuehner explains.
     Panalpina’s local staff is responsible for the unloading and loading of the B747Fs. The astonishing result is an average turnaround time of 120-minute for the big Boeing Jumbo freighter. “That’s an awfully good performance,” lauds the manager.
     After arrival, most of the imports have to be transported to their final destinations within the Dixie belt. “We offer our clients a tightly-knit network of trucking services out of Huntsville,” Kuehner says. Most of the consignees are located within a driving distance of no more than 1,000 km from Panalpina’s airport warehouse.
     Because of its oversized nose-door, the Dixie Jet can be front loaded with extra large goods, like drilling equipment for the oil and gas industry. The equipment originally comes by truck and mainly from Houston, although some are brought from Huntsville, and by plane they travel to the Scottish offshore oil and gas fields in the North Sea. Others fly via Luxembourg to Angola or other places.
     “Entire transports are managed within our own freighter network,” states Kuehner. According to him, 15 percent of the agent’s total air freight volume is flown on board freighters deployed by his enterprise.
     “From the very first flight twenty years ago until today, the Dixie Jet has been a major contributor to our global display of cargo transports.”
      So you can be sure that a lot of Dixieland music will be played in September when Panalpina managers, Huntsville officials and many customers come together to celebrate the 20th anniversary of this extraordinary service.
Heiner Siegmund/Flossie

Give Us A Lift
     New Atlas Air offices in Manhattan?
     No, this is Rockefeller Center (New York City), directly across the street from St. Patrick's Cathedral. It is here that a 2-ton statue of Atlas, fashioned by Lee Lawrie and Rene Chambellan, has been kneeling under the weight of the world since 1936.
     He carries the heavens upon his shoulders as punishment and penance for defying Zeus.
     We always reflect upon the original statue every time an Atlas aircraft like the Dixie Freighter, with its stylized Atlas tail art, rolls by our window.
     We like to imagine that maybe the late great Michael Chowdry, founder of Atlas Worldwide Holdings, may have been in Manhattan one day and was inspired to go out and lift the world.
     Works for us.
Geoffrey

Summer Afternoon At leisure BKK

     LTU Asia Tours Co Ltd, leisure’s GSA for the Bangkok airfreight market is one of leisure Cargo’s oldest partners when one considers that the cooperation dates back to 1998.
     LTU Asia, which will shortly undergo a name change in line with an acquisition by Air Berlin, already demonstrates its close relationship with Air Berlin Group by having offices located in the same building as Air Berlin on busy Silom Road.
     Cargo development in Thailand for tourist-orientated airlines such as Air Berlin harkens back to the humble beginnings of LTU operations in cargo sheds, utilizing Lockheed 1011 aircraft at the former airbase, old Don Muang Airport.
      Capacities and logistics changed with the arrival of new aircraft types like B767, MD11and A330. Fast forward to the opening of Suvarnabhumi Airport which wound up propelling Thai Cargo logistics into the 21st Century.
     LTU was pioneering airfreight during the early nineties and leisure Cargo introduced the flexible new business model in 2000.
     Raymong Honings runs the leisure GSA operation and came to Bangkok in March of 1971 on behalf of a German tour operator, then from 1978-1983 he worked in Sri Lanka, returning to Thailand in 1983.
     Despite difficult times, LTU Asia produced a record result in 2009, carrying 3,300 tons to Europe and onward. Most of the shipments on leisure Cargo flights are semiconductor components, textiles, medical equipment and clinic supplies. LTU Asia is cautiously evaluating whether to participate in the prominent perishable market segment because of the insecure payload availability. Often, the westbound flights are restricted weight-wise due to heavy seasonal headwinds.
      At Suvarnabhumi Airport, airlines have a choice of two competing handling partners. leisure Cargo has an overall contract with Thai Airways International cargo. Export and import shipments are handled in the huge state of the art cargo terminal and on the ramp. leisure man at the airport is Cargo Supervisor Yuthana Punsuwan with a staff of 18 at the station. “Thai Cargo, as well as the customs authorities, are very cooperative,” he confirms.
      As it happens every year, to accommodate the shrinking demand during the European Summer off-season, leisure Cargo carriers serving Thailand, i.e. Air Berlin and Condor, reduce frequencies. From May to November, flights are flown from Bangkok, Phuket and Krabi to Berlin, Duesseldorf, Frankfurt and Munich.
      Raymond Honings looks to a future with peace in the country again; an economy recovering from the endless crisis and, increasing exports and imports followed by higher yields on the trade lane. Also, he muses “…it would not be bad at all to find a suitable cooperation carrier between Bangkok and Australia.”
GM/Flossie

Contact! Talk To Geoffrey

RE: Break Up Oilogopoly
      
Geoff:
     I read your Friday Opinion from Julian Keeling piece “Break Up Oilogolopoly”.
    It makes a lot of sense.
    After listening to Texas Rep. Joe Barton’s apology to BP, for the $20,000,000,000 “shake down, it makes one realize that like Anakin Skywalker, we are gradually and certainly going over to the Dark Side.

All the best,
Paul Abrams

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