Vol. 12 No. 95                       THE GLOBAL AIR CARGO PUBLICATION OF RECORD                  Wednesday November 6, 2013
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THE AIR CARGO NEWS THOUGHT LEADER  




Richard Malkin at The Reichstag Berlin, 1948. Malkin’s coverage of The Berlin Airlift (1948-49) invented modern air cargo journalism. Here he returns at 100+ years of age to continue his landmark reporting exclusively in FlyingTypers.

ir cargo journalism was a career that I neither planned nor anticipated. In fact, it did not exist as a specific profession before I gave up my job as a reporter for a daily newspaper to assume the editorship of what billed itself as the world’s first dedicated air cargo periodical. This occurred a couple of years before the dawn of the so-called Air Cargo Age in domestic and international commerce at the end of World War II.
      The plain truth is that my passage from newspaper to magazine activity was purely an economic decision: I harbored no interest in aviation or transportation. Privately, I intended to hold on to the job for several years, get onto firmer economic ground, then shift to a more desirable editorial environment.
      As it turned out, I lasted 66 years writing about all manner of property moved by air.
      Without realizing it, I had been seized and held captive in the powerful grip of diverse dynamic forces in motion, not least the spectacle of the horde of Air Transport Command and Naval Air Transport service veterans, many of them with overblown visions of their roles in this new business called air cargo—a reminder, as a wise man once pointed out, an exaggeration is a truth that has lost its way. But more about the Air Force hopefuls later in this article.
      At the time of the new industry’s beginning—and even before then—the absolute definition of air cargo embraced all forms of property. Not only did it cover express and freight, but mail and baggage as well.                  Dealing with the monthly traffic statistics received from the airlines, savvy editors soon learned to verify the actual tonnage of shipments carried. Adding to the statistical confusion, foreign operators tended to report the results in kilos in contrast to pounds or tons reported by the U.S. airlines. A Civil Aeronautics Board held tight rein on a new industry it was learning to understand.
      Despite, as previously indicated, the birth of the Air Cargo Age at the end of hostilities in 1945, scheduled air shipping in the U.S. had been in existence since 1927 when a single-engine aircraft of National Air Transport flew a load of small packages and boxes from New Brunswick, New Jersey to Chicago. This was the origin of REA Air Express. A creature of Railway Express Agency (owned by 80 railroads which enjoyed a lucrative contract with the nation’s scheduled airlines until international competitive reverses decades later spelled the agency’s end. An ambitious newcomer with a service strategy all its own, popped into existence.
      Nor was air freight—bulk consignments—totally absent in the pre-Air Cargo Age years. Pan Am flew occasional planeloads of 24-hour baby chicks to Latin American destinations, and there were notable freight movements by TACA and Avianca, and, yes, the Canadian bush flyers, but these were too few to signal an explosion of freight revenue for the airlines.
      From a running start in the second half of the 1940s, significant examples registered what the new industry would look like in the future. Hauled in aircraft that were pale shadows of today’s giant jets, the world’s important airlines gave evidence of starting hard- freight operations. Consider, for example, a zoo-bound planeload of assorted animals, including a baby elephant. Or an entire household flown thousands of miles to an overseas inland location. Or the substitution of the speed of air cargo for refrigerated ground or sea transport of perishable commodities. To borrow a biblical expression, the fledgling industry went annually from strength to strength.
      Like the history of the surface transportation companies, the appearance of the middleman inspired little affection in airline ranks. The IATA-approved commission-earning cargo agent preceded by years the cargo-consolidating air freight forwarder.
      The rise of the cargo agents was swift and dramatic. They descended in large numbers on export communities on both coasts and the Midwest. Typical of the swarm of newly IATA-authorized cargo agents was the avid chap armed with a desk, a phone and a stack of air waybills. Facing traditional shippers asked to pay rates sharply higher than they were accustomed to pay, the cargo agents turned patient and persistent educators, setting forth the inherent economic advantages produced by the speed of air transport. It was no easy sell, and often—too often—price was king, even under demonstrated proof that air freight’s bottom line should be preferable. Those were the days when physical distribution executives were as rare as kiwis in Yellowstone Park.
      As the volume of agent-derived traffic increased at a steady pace, a few international air carriers questioned internally whether it was smart to become dependent on the agent for what may turn out to be an interesting potential.
      A leak at Pan Am disclosed that a key executive, concerned that the cargo agents might achieve control of the airline’s growing freight business had proposed to open direct competition against them if their input reached a threshold of 20% of Pan Am freight revenue. The leaked news produced an instant emergency meeting of agents in a Manhattan restaurant, and after emotional debate voted to make Pan Am the carrier of last resort. Pan Am reacted quickly. At a hastily arranged meeting with an agents committee, it pooh-poohed the veracity of the leak and offered calming words of support. Out of that session came a period of mutually guarded accord.
      Forwarder consolidations of high-rated small shipments incited no yelps of glee from the airlines. They were largely regarded by the carriers as competitors. The airlines’ darling of the latter Forties was Emery Air Freight whose pricing in its startup year—it refrained from competing with domestic airline rates unlike the other intermediaries—it sold and delivered top-quality service before the iron realities of the marketplace compelled it to offer competitive rates.
      As an air cargo innocent, virgin territory each workday was an experience in discovery, often familiar but in a totally different context. It was both fascinating and challenging. The determined forces of a pulsing creative bent, of steady focus of expectation in a still blurry tomorrow.
      Not very long after the return of peace, I found myself tramping California’s strawberry and lettuce fields, and covering stretches of Florida and Texas flower growers. I watched the careful offloading of Jamaica lilies for the Easter market. A bit later I flew to the Netherlands for an eye-opening visit at the fabulous flower auction in Aalsmeer. It did not take genius thinking to understand why these perishable products were among the first natural candidates to take to the air. This led to my discovery that varieties of fish had donned wings. Interesting to note is that the Air Cargo Age was only three years old when Lockheed engineers participated in tests of the effects of altitude and changes of pressures on 34 different types of fruits and vegetables.
      I can conceive of no better descriptive word than “wonderland” for those pristine years. Close witness to extraordinary feats of freight flying, I was reminded that all fine things descend from originality; for the first time restaurants in interior cities received fresh fish from Eastern waters . . . A ship’s propeller weighing 6 1/2 tons, too long for normal loading, slung on specially constructed beams beneath the fuselage; an overseas tramp operator picks up and delivers random shipments to a series of airports on a circuitous route.
      Yes, all the above—and more!—when commercial air cargo was still in diapers.
      In a published work some years ago I noted an incident involving an ATC veteran who paid a visit to my office about a year after the war. In a broad display of unsophisticated candor he charmingly informed me that he had acquired a war-surplus C-47 cargoplane, and could I tell him how to go about getting into the airline business.
      I mention this because he was typical of scores of ex-service flyers and handlers whose postwar ambitions pointed in the same direction. The immediate postwar era showed explosive growth of what now were often called “GI airlines”—all nonscheduled airlines, many of these new air carrier companies built on the strength of a single war-surplus transport. Rise and fall—it took a few short years, victims of the tough realities in marketing, pricing and, of course, competition.
      But a few hardier ones survived, a small number longer than the rest. Among these escapees from nonscheduled to become scheduled carriers. This small group included such familiar brands as Flying Tiger, Slick, Seaboard, etc, now fading memories.

      In spite of their record during the first few years, they are generally credited for a significant contribution to awareness of the plane as a true component of modern distribution.
      Having passed through the entire life of the air cargo industry to date, I found myself effortlessly settling on the earliest years—the years when imaginations and hopes ran riot—as, for me, a spell of utter romance. (What was inevitably to follow was a parabola of mammoth jetfreighters, automated cargo handling, containerization, brilliant applications of modern technology, fierce competition on a global scale.)
      Passenger-oriented from the very start, the scheduled airlines’ development of revenue from the carriage of cargo above REA’s contributions was at low ebb. There was a certain charismatic glow bathing sales people who often rubbed elbows with celebrity passengers. A man assigned to cargo was likely said to have been exiled to Siberia. (A former top executive at Lufthansa admitted to me that in his youth at the German airline, cargo was referred to as a fifth wheel.)
      Gradually, but with increasing frequency, bulk shipments moved into the air. American Airlines anticipated what lay ahead and was the first to offer scheduled all-cargo service. Its inaugural freighter flight flew from New York to Burbank, including several intermediate stops.
      As sure as the daily rise of the sun, there came the crop of unabashed prognosticators to spread the good word. There was a happy aura of certainty that surrounded their expressions. One by one, airline and forwarder executives donned the seer’s mantle and seriously issued predictions that airline cargo revenue would pull abreast passenger revenue in—depending on the predictor’s gift of prophecy—10 to 15 years. Ralph S. Damon, then president of TWA, proved to be more conservative! He maintained that it would take about 25 years. The ensuing decades proved that Pliny the Elder had it right: the only certainty is that nothing is certain.
      This article of memory-wresting details is essentially devoted to the postwar Forties with one or two brief forays beyond. It is meant to focus on elements—at least some basic ones—that formed the arc that was dubbed the Air Cargo Age.
      On a path that was to lead to an ultimate global aerial network fat with the goods of man, there were trial and error, success and disappointments, visionaries and naysayers. All things considered, I am inclined to say that the first few years of my six-and-a-half decade career in air cargo were crammed with the stuff of pure romance.
      The industry’s green years had, as shown, its crop of dreamers and those comfortably wrapped in tradition. The dreamers stretched the bounds of possibility. Along with their dreams of global airfreighter fleets were predictions of complementary services by airships, helifreighters, and parachuted deliveries. Is dreaming an exercise in futility? There is an old French suggestion—Tous songes sont mensonges (all dreams are lies).
      Don’t you believe it.
Richard Malkin
malkin101@aircargonews.com


All About The Man Who Invented Air Cargo Journalism
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here is something youthful, smart, and very engaging in the “something’s coming” manner of Robbie Anderson, President of United Cargo—it tells you right away that not only he is a team leader with whom to be reckoned, he is also a man on the move, and we should all listen, watch, and learn from his moves.
     Ever since he took hold of the hottest potato in the mega airline cargo business, Robbie has been a whirlwind of non-stop activity. He’s dealt with the various challenges of integrating CO and UA into one carrier, and bringing everything together in working order, has played against a dreadful global shipping slump.
     When he does slow down long enough to give a speech or sit on an air cargo panel as he did earlier this year at CNS Partnership, where his comments and thoughts were brilliant, Robbie leaves no doubt he has a handle on what is increasingly being viewed as a reborn United Airlines Cargo, and he emerges as a air cargo super-star.
     No, it has not been a walk in the park.
     “No one who lived through combining two great airlines into one business will ever forget the experience,” he once said to me.
     But rather than just combining UA & CO Cargo, the cargo company is also being retooled from top to bottom with a new business approach, new IT, new terminals, and other major enhancements.
     So: has it worked?
     In a sagging economy amidst change, United Cargo has suffered some setbacks.
     But there have also been some pluses.
     “There’s a new spirit at United,” said Tilo Weger, who purchases air cargo services for EMO Trans, the fast-growing global logistics company.
     “They are quick to react, and are very interested in making sure what they offer is delivered.
     “In a demanding environment, they are going the extra mile to make sure things are right and we appreciate that attitude.”
     So if the long promised road leads to water at the draw, where all the parts and actions are working as one and business is returning as now seems the case, where does that leave United Cargo as November 2013 begins? Recently Robbie addressed the troops in a “Worldwide Meeting,” and we joined that session to listen as well.




     “I am very happy to state that at United Cargo, we are once again focused on running a cargo business.
     “Of course we always have been focused on this, but since United and Continental announced our merger in May 2010, and even after we received a single operating certificate in November 2011, we have also been ‘running a merger.’
     “Up to our ‘Cargo Day One’ in December 2012, when we integrated our capacity and moved to one air waybill and website, we were also ‘running an integration.’ For 12 months beginning in June 2012, in many stations we were ‘running a vendor transition.’
     “And since July 1 of this year we have been ‘running a system rollout.’
     “That’s a tremendous amount of uninterrupted change for our customers and co-workers.
     “Now that it is behind us, we’re pleased to focus our full attention on running our business.
     “Our primary job is to excel at the basics so that our customers know they can trust us with their shipments.
     “We also need to ensure our customers know we value each and every piece of freight they give us, and that we are eager to do whatever it takes to recapture our market share.”


     “The most meaningful success is that we now have a stable technology system and reliable processes throughout our worldwide system.
     “Many of our customer-focused service metrics—both in our Cargo 2000 shipment milestones and our Customer Contact Center—are achieving higher levels of success than they were before the system transition.
     “In terms of commodities, our specialty product line has been one of our strongest segments in 2013—spurred by solid performance by PetSafe and our high-value UASecure segments.
     “We have also continued to expand our TempControl network.
     “Our temperature-controlled shipment service is now certified to operate in 43 locations with an additional 16 cities planned in the very near future. In addition to our long-term relationships with Envirotainer and CSafe, we recently transported our first shipments using the va-Q-tainer.
     “Through our partnership with va-Q-tec, we’re providing customers another option for passive temperature control.
     “We ship the va-Q-tainer via our EXP express freight product as well as via our TempControl service.”


      “We plan to take advantage of some of the benefits of our new system to enhance our customer service in 2014.
     “United targeted a phased rollout of the full UC360° system capabilities from the early stages of planning. Phase 1, implemented July 1, included our core operations, capacity management, and cargo revenue accounting functions.
     “Work is already underway on Phase 2, which will include functionality such as ULD management and a number of e-commerce enhancements.
     “This is a key feature of the system for us: UC360° will allow United Cargo to effectively participate in e-AWB and e-freight.
     “We expect to continue our progress in several other technological areas in 2014.
     “We are particularly highlighting our exchange of messaging with customers and our websites: unitedcargo.com and cargoportalservices.com.
     “On the service side, we learned from the system rollout that we needed quicker and more consistent solutions to shipment issues. Implementation of the new end-to-end process developed by the Lean Six Sigma Issue Resolution Project Team has already begun.
     “Expect to complete the customer contact portion by the end of January 2014 and field location training by the end of the first quarter of 2014.
     “United strongly believes that customers will notice and appreciate the improvement in the frequency of issue-related contacts and in the efficiency and effectiveness of our issue resolution process.
     “Looking at new routes next year, we are very enthusiastic about starting daily 777 service between San Francisco and Taipei March 29, and about our application to serve SFO-Chengdu, China, with the Boeing 787 Dreamliner beginning in June 2014 (pending government approval).
     “Chengdu is a perfect example of the type of emerging market made economically feasible by the 787.
     “The Dreamliner is about 23 percent more fuel efficient, and carries about 22 percent more cargo, than the Boeing 767—the aircraft it is replacing in our fleet.
     “It’s very exciting to consider the possibilities of new cities and new regions of the world that United may serve with the 787.
     “But we also recognize the need to innovate in a challenging market, so we are doing some creative things with trucking and narrowbody aircraft capacity that we haven’t done before.”


     “One of the most significant changes in the postal business is the decline in ‘letter class’ mail and the increase in priority mail parcels.
     “The USPS continues to be United Cargo’s largest customer, and our commitment to them has not changed and we are working to determine how to best accommodate changes in the postal business to ensure we continue to maximize the use of our leading network.
     “I am very pleased that the USPS has renewed their Micronesia contract with us, and we look forward to continuing to serve those markets.
     “Foreign post mail is another area of potential growth for United Cargo.
     “The USPS has utilized mandatory scanning and ‘pay-for-performance’ for many years, and we expect foreign posts to apply this model as well.”


     “Two concerns that come immediately to mind are longstanding industry challenges: the regulatory environment and modal shift.
     “Of course security regulations will always have a major impact, but I’ve been expressing the opinion that environmental issues will be, in the next 10 years in cargo, what security issues were in the previous 10.
     “Along with the increasingly diverse and complex standards proposed by different countries, United Cargo’s customers and their customers are starting to ask about the carbon footprint of their shipments and the overall environmental impact of air freight.
     “So I believe all of us in the industry need to know what we can and should do.”


     “Late last week, United announced the release of an enhanced cargo emissions and offset calculator to compute and display per capita carbon emissions for customers shipping on United Cargo.
     “Continental Airlines launched the first airline cargo emissions calculator in North America in May 2008, and United remains the only airline in North America with a cargo emissions calculator.
     “United is an industry innovator in ‘green’ initiatives through our Eco-skies program, and we strongly support the air cargo industry’s stated commitment to an aggressive program to promote environmental sustainability.
     So we’re proud to contribute to our industry’s progress and United’s leadership on this critical issue.


     “Modal shift is another area of concern our industry must address.
     “We’re all familiar with the estimate that air cargo has lost 10 percent of our volume to ocean carriers since 2000.
     “While there’s no question that the lack of sustained economic growth is contributing to this shift, there is a lesson that the ocean mode can teach us.
     “They have improved their product in recent years in many ways—including speed, dependability, and availability of information.
     “I think our industry can generate similar gains by developing ‘innovations on the ground.’
     “Since our planes aren’t likely to fly any faster, we need to exploit the potential for improvement and innovation in every phase of our process: in each transfer of a shipment between entities, every time we physically move a shipment, and in all the ways we gather and disseminate information.”


     “From my perspective, this is a very exhilarating time to be a part of the cargo industry—particularly at United Cargo.
     “Our industry’s challenges are well-known.
     “But I sense we are reaching the point where the spirit of collaboration, along with concerns about the consequences of further delays, will lead to beneficial action on those issues we can solve together.
     “Last month as you know, we held the first worldwide meeting of the United Cargo organization since the merger.
     “We challenged and encouraged our entire team to use their creative talents to generate innovative new ideas for delivering customer value.
     “I firmly believe that no one is smarter than our team, so I’m very excited about the new methods we will be developing to recapture and grow our market share.
     “I’m very proud of the way our United Cargo team, along with our service partners, has worked together and stayed together during the four months of the UC360° rollout.
     “It’s been a time of great challenge, but the levels of skill and dedication have been even greater.
     “I’m grateful to everyone for the tremendous effort they put forth to get us to where we are today.”


     “We definitely learned some lessons in the execution of the most complex system integration in the history of the U.S. cargo business.
     “Some of our customers are planning their own system transitions and have asked me for recommendations.
     What I tell them is don’t do a knife-edge cutover if you can avoid it—roll the changes out to your network in phases if you can.
     “Unfortunately, due to the interconnectedness of United’s network, we couldn’t do that with UC360°.”


     “A few other pieces of advice I’m offering: no matter how much you time and effort you’ve spent in planning, you haven’t planned for every contingency—so expect the unexpected.
     “Also, whatever resources you’re allocating for support and training for users after the rollout—double them and double them again.
     “You can never have too much.”


     “Perhaps I can be the first to send out best wishes for a wonderful holiday season to our customers and their families from the United Cargo family! In the spirit of Thanksgiving, we are very grateful to our customers for their understanding and support over the past four months.
     “As I said earlier, we’re focused on excellent delivery of service basics so we can be counted on as a reliable partner. But we’re also enthusiastic about what lies beyond the basics. As we drive to optimize our products, processes, and customer relationships, we now have a system that can integrate and support these efforts.
     “We have also instilled a spirit of entrepreneurship in all our people—we are eager to listen with imagination to all ideas our customers have for developing our business together.”
Geoffrey/Flossie





istorically, the Port Authority of New York & New Jersey has not known how to manage either a fine arts collection or landmark buildings at its JFK, LGA, and EWR airports. Now a plan comes forward to wholesale one of the most beautiful and iconic airport buildings in the world, Eero Saarinen’s exquisite, poured-concrete butterfly, which TWA built at Idlewild Airport (JFK) in 1962.
The announcement came in the form of a short blurb (or was it a burp?) recently in the New York Post that reads more like the landmark structure is being dumped than anything else.
     Port Authority gives Balazs Properties the OK to plop a 150-room hotel, a new conference center, retail space, spa, fitness center, flight museum, and restaurant collection into, over, and around one of the most significant airport buildings in the history of aviation.
     Not content to have forever destroyed the vistas of TWA Saarinen with ugly parking garages, massive roadways, and looming new construction, now Port Authority wholesales out this beautiful place to be redeveloped into a hotel, gym, aviation museum, and anything else the developers can think of.
     So far, the elegant fingers that once led out to waiting aircraft have not been designated as bowling alleys, but don’t hold your breath.


     Although he died in 1961 and never saw his masterpiece completed (he also designed the St. Louis Arch that opened in 1962), Mr. Saarinen is regarded as one of the greatest architects of all time.
     At TWA JFK, Eero envisioned every aspect of design from the chairs in the building to the ticket counters, and even the sweep of the shoeshine stands.


     One can only wonder, as the old 200-plus room International Hotel sits derelict and empty on airport property at the entrance to JFK—having been abandoned some years ago, left to ruin, and looking for all the world like something out of downtown Detroit—why this boutique hotel operator has to mess with the TWA Saarinen building in the first place.
     The International Hotel sits on the airport’s prime land area with acres of parking, and has a striking look, to boot.
     But back at the TWA Saarinen, huddled close to the ground and sandwiched against a parking building and the hulking JetBlue passenger terminal, the other wonder is if the inside, like the outside walls, are protected by New York City Landmarks from further incursion?
     If not, somebody better get busy and have that done at once.
 IM Pei Sundrome was bulldozed and trucked to dump by Port Authority two years ago, despite widespread protest.

    Think back two years—the building right next door to TWA Saarinen, the beautiful “Sundrome in Glass,” Terminal Six, designed by IM Pei around the same time as TWA Saarinen, was thoughtlessly bull-dozed and carted in trucks to the city dump by The Port Authority. This happened despite pleas from everyone, including the then ninety-five year old Pei himself, to save the exquisite treasure.
     The simple truth is that JFK International as an airport sends the clear message that the Port Authority is a lousy operator of airports and should have been canned from running the New York New Jersey airports a long time ago.
     Back when Rudy Giuliani was NYC Mayor and their 50-year lease was running out, that almost happened.
     Rudy wanted Port Authority out in 1998 but dropped the ball, deciding instead for a bid to become U.S. President.
     At the very least, Port Authority is not equipped and should not have final say over the historic buildings at the New York New Jersey airports.
     Left to Port Authority’s own devices, The Marine Air Terminal, where flying boats once roamed at LaGuardia, the old 1934 Administration Building at Newark, and even TWA at JFK would not still be standing today. We can thank our fearless leader, Geoffrey Arend, for having a hand in preserving these timeless structures.

     Taking a wider view, just look at JFK International Airport.
     Today thousands if not millions of people rate JFK—once the king of airports—as among the worst aerial gateways on the planet.
     For air cargo, JFK is underutilized & underdeveloped, with little or no plan in place to make things better.
     What is happening right now at TWA Saarinen can be viewed as typical Port Authority action.
     Not knowing what to do with the place, Port Authority finds a developer with a pulse and cuts a deal that imperils the future of an irreplaceable treasure that belongs to City of New York and the entire history of aviation.
     People who love the TWA Saarinen building and historical preservation in general must rise up and scream bloody murder and organize to shut these people down before it is too late.
Sabiha/Flossie


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