Menen is one of the original founding team of Emirates Airline, that
headed SkyCargo from inception in October 1985.
Ram, it can be said, built SkyCargo from the ground up
to its place near or at the top of the world, as top executive and
guiding spirit for 27 years.
In fact when he retired in 2013, he departed Emirates
with SkyCargo as the largest international cargo airline in the world.
Ram is a FCILT (Fellow of the Chartered Institute of Logistics
& Transportation), as well as a FRAeS (Fellow of the Royal Aeronautical
He is one of the founding members of The International
Air Cargo Association (TIACA), serving as Vice President in 1993 and
1994, and as President, CEO and Chairman of the Board in 1995 and
Ram Menen has won every major award given by industry
Today, with his wife Malou, he splits his time between
homes in Luxembourg and Kuala Lumpur.
Their son Ram Menen Jr. continues in the family transportation
tradition. Ram Jr. is currently employed by Amazon Logistics.
What Happens Next?
“When we used to say that we were
living in an interesting time at the turn of the century,” Ram Menen
said, “we hadn’t even imagined what interesting times would
really look like!
“I don’t think what we have
seen during the last couple of years is a normal economic cycle.
“Normal cycle would have put the world
into a recessionary period toward the 3rd/4th Quarter of last year.
What Has Changed?
“The socio-political environment has
completely been disrupted, not sure for the better, because of
the protectionist policies creeping back and the resultant looming trade
wars between major economies.
“It has become extremely difficult
to make any kind of forecast with confidence.
“Call it the Trump Effect!
“On top of that, the Brexit chaos
has not helped.
“Basically we have seen the can being
kicked down the road, and now it is almost certain that it is going to
be a 'no-deal Brexit'.
“The highs that we saw during the
last year have been a result of the inventory build up to avoid paying
tariff in the U.S. and China, as well as hunkering down for a ‘no-deal
Looking At Timelines
“In the case of the U.S., the efforts
in firing up the domestic production and manufacturing activities is likely
to take time, which means that the U.S. will still have to rely on imports.
“Ramp up in non-tariff affected countries
like Vietnam can also take time.
“It is good that the second wave of
tariff regulations on Chinese goods has been postponed.
Nothing Written In Stone
“The lows that we are experiencing
could be temporary and as the stockpiled inventories get depleted, looking
forward, we should see the demand for cargo coming back and can expect
a better second half of the year.
Cargo Will Come BACK
“We should also see a spike in demand
into UK during September and October . . . just before
the no-deal Brexit.
“There probably will be a lull in
traffic to UK during the last quarter of this year.
“The demand for rest of Europe is
likely to be steady.
“LATAM and Africa market demand is
likely to be moderate. Intra-Asia Pacific demand is likely to remain strong
and on a growth footing in the movement of components traffic as manufacturing
activities try to find ways of tariff avoidance in the U.S.
Watch On The Gulf
“The Gulf region is likely to see
demand for air capacity as the shipping lanes are affected by the current
spat between the U.S. and Iran. It is a hotspot and something that needs
to be watched closely.
“It is potentially a dangerous and
volatile situation and a war could change the market dynamic, not only
in the region but in other parts of the world.
Capacity Rationalization Is Key
“Key to managing the next 12 months
will be capacity rationalization. I see the ocean folks have already embarked
on this by blanking out sailings over the next couple of months.
“The pressure on yields will be acute
because of the pressure from procurement folks to reduce costs to absorb
the increase in costs because of increase in tariff in the U.S. and China.
“E-commerce will continue to power
the air cargo industry. Giants like Alibaba and Amazon will continue to
change the dynamics of the air cargo industry. So will the likes of Flexport,
making digital logistics a reality.
Keep A Weather Eye Out
“As mentioned earlier, the current
trend is an anomaly and markets can go either way because of the uncertainties.
However, my gut feeling is that the second half is likely to be better
than the first.
“Only time will tell,” Ram Menen