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   Vol. 15  No. 27
Monday April 4, 2016

FIATA Fellow

Another Opening

An Opening
  Operations resume at Brussels Airport in Zaventem, near Brussels, Belgium, April 3, 2016.   The airport was reopened after the terror attacks of March 22, when at least 31 people were killed and hundreds injured in bombs explosions at the airport Departures Hall and at Metro stations in downtown Brussels.

April Numbers

     Reports from Asia’s forwarders are not exactly uplifting. One told this correspondent that there had been “barely a sliver of improvement” post-Chinese New Year in import and export demand across the region, “with the exception of the Philippines.” Another said it was “downright depressing” when asked about prospects for the rest of this year.
     And it’s not hard to see why gloom is the dominant mood. China, critical as always, saw its trade volumes ominously contract last month, with exports in February down 25.4 percent—the worst decline since 2009, the height of the global financial crisis. It’s worth noting that the baseline drop of 25.4 percent was in export value, not volumes, as reported elsewhere. Moreover, the earlier Chinese New Year in 2016 versus 2015 and recent currency fluctuations skewed February’s year-on-year figures. March data will reveal a more accurate overall picture of Q1. But, even so, last month’s exports decline caught analysts by surprise and deepened concerns about the state of the world’s second largest economy.
     With the European and U.S. economies both also looking fragile, albeit in different ways and for very different reasons, the fact that airline executives and air freight forwarders seem especially pessimistic about key trade lane yields and rates to Europe and the Pacific out of Asia is no surprise. Indeed, it reflects the views of ocean freight executives, who have also seen spot freight rates collapse this year on poor demand and excess supply.
     What was a surprise was IATA’s early March report, which claimed that global air freight markets had seen a 2.7 percent year-on-year rise in freight ton kilometers in January, while Asia Pacific carriers, which account for 39 percent of all air freight, had expanded by 1.3 percent year-on-year.
     “This continues the improving trend witnessed toward the end of 2015, and is the fastest pace since April of last year,” said the Association, which countered its “good news that volumes are growing” with warnings that yields and revenues “were still under tremendous pressure.”
     It will be interesting to see how IATA’s February figures and analysis compare to January’s when they are released in the first half of April, not least because the Association of Asia Pacific Airlines noted a 0.7 percent decline in FTK year-on-year in January among its Asia Pacific carrier members. Andrew Herdman     Andrew Herdman, AAPA Director General, reported that “the usual lift in air cargo shipments seen ahead of the holiday season had been somewhat muted, as seen in the continued weakness in air cargo volumes.”
     Given the downpour of poor macro readings, Drewry’s analysis of air freight markets puts some rates to the various airline association musings on FTKs and also gives a more meaningful take on Q1 overall.
     The analyst’s East-West Airfreight Price Index—a weighted average of all-in airfreight “buy rates” paid by forwarders to airlines for standard deferred airport-to-airport airfreight services on 21 major East-West routes for cargoes above 1,000 kg—dropped by 3.8 points in February to a reading of 79.2.      This represented the fourth consecutive month of falling pricing, during which time the index has declined by 20.5 points from its October peak. In terms of average pricing, this converts to $2.57 per kilo in February, down from $3.24 last October and $3.17 a year earlier.
     Perhaps more significantly, it means the index is now at its lowest level since it was launched in May 2012. “Drewry expects airfreight rates to remain challenged over the course of the year by weak global demand yet rising capacity, as buoyant passenger traffic releases more bellyhold space,” said the analyst.
     The March Stifel Logistics Confidence Index (LCI) painted a similar picture, with airfreight and ocean freight markets weakening. “The overall climate suggests weaker than normal seasonal levels, as it has for the last six months,” said Stifel.
     “Our baseline expectation is for 2016 to be a slow year for global GDP, and maybe an even slower year for global trade volumes. The LCI six-month outlook remains barely above the 50.0 (total freight at 50.4, with air freight at 51.7 and sea freight at 49.1) threshold for growth vs. normalized levels, suggesting that survey respondents feel similarly.”
     In the March Index, air freight results were mixed, with the trans-Atlantic outperforming the Asia-Europe trade. The total air freight logistics confidence Index gained 0.5 points in March 2016, totaling 48.6. The Index is 9.3 points lower than in March 2015, and 7.3 points lower than in March 2014.
     “On a year-over-year basis, our index readings on Europe-Asia and Asia-Europe lanes are likewise down well into the double digits in both air and sea freight. As a result, we believe the market remains soft.”

Subscription Ad

Delta Cargo Marketing From The Ground Up

    Ask Delta Cargo’s Product & Express Development Manager Pawel Borkowski what is moving up the Cool Chain right now, and his answer is immediate:
     “Delta Cargo’s premium products drive a significant portion of our revenue mix, so far up 2 percent YoY for 2016. 

     “Variation Pharma/Wheels/Safe, DASH, and DASH Heavy are leading this great result.
     “We hope with our investment and product evolution our premium product mix will continue to grow.
     “Delta Cargo’s Cool Chain solution includes operation of 49 Pharma approved stations globally that serve our customers well, but we constantly strive for excellence.
     “In 2016 we are investing in product and station enhancements and expanding certification.”
     Pawel delivers the message that the big Atlanta-based carrier actions globally, while also thinking locally.
     “We are excited about our cool chain solutions.
     “Especially relevant for ATL and JFK, for example, is our review of IATA’s CEIV Pharma certification, upgrading CCTV, adding outlets for active containers, enhancing pharma training for staff, and much more.”  

Name of the Game is Service

    “Delta Cargo’s Variation Pharma product is a very well-rounded offering from booking to recovery. 
     “For booking and customer service needs we have a dedicated Pharma Desk to handle anything from a 5kg shipment to arranging active or passive containers with any of our container partners—CSAFE/Envirotainer or va-Q-tec.
     “Pharma shipments get expedited and cool (too cool for school) treatment by our Pharma trained staff at any of our 49 Pharma approved stations.
     “Temperature checks on coolers and each active container ensure our equipment is working as it should and this information is available to our customers through the Pharma Desk.”

Most On Time

    “DL is the most on-time airline in the world, and with all four of DL’s Variation Pharma products having a level 1 boarding priority, these sensitive shipments will get to where they are going when they are supposed to be there.”

Who Is Pawel Borkowski?

    Like other young and energetic rising stars in the air cargo business, Pawel Borkowski approaches air cargo product marketing in an uncomplicated manner, from the ground up.
     “I like to think I bring a high level of customer service. 
     “As manager of product development it is really my job to understand the needs of the customer and create a solution for meeting those needs in our product portfolio. 
     “However, I find at Delta Cargo a high level of customer service is more the rule than the exception.” 
     Pawel Borkowski is married with a two-year-old daughter and is looking forward to his 15th wedding anniversary.
     “We enjoy traveling, hiking snorkeling and cooking,” Pawel said.
     “I also enjoy movies, classic cars and the orchestra.”
     “I think my career has been an evolution of my goals to continue to grow and challenge myself both personally and professionally.
     “I started out at Northwest Airlines in Passenger Revenue Management, pricing transpacific routes.
     “I worked through the merger with Delta Air Lines, where I continued in RM for several years. 
     “Later I transitioned to Cargo Revenue Management, where I was responsible for pricing exports from Europe, the Middle East, India, and Africa.
     “Seeking further development, I gladly accepted a position on the Cargo Product team responsible for developing revenue for all temperature controlled products. 
     “Recently I was promoted to manager of product and express development, also on the product team, for which I am now responsible for Delta Cargo’s entire product portfolio globally.
     “From the beginning up until now, I have had the privilege of working with and learning from the best people, period.
      “When you are surrounded by great people all you have to do is open your heart and mind and you will be great too.” 

Jim Butler Super Power

But Technology Is Also Good

    “The air cargo business would be so much more efficient if effort were applied all around to simplifying regulations. 
     “I see the need and agree with regulation, but I hate to see delayed cargo because of processes that extend shipping times unrealistically due to the way airlines are mandated to work with various agencies. “Utilizing existing tech would optimize and streamline processes, benefiting everyone,” Pawel said.

Must To Get Across

    “Part of my job is to reach out to the shipping community and our service partners; last week we were at the JFK Air Cargo Expo in New York to extend the understanding of how well developed our premium products are. 
     “For example, a lot of attention is out there on Variation Pharma, but we also have Variation Live (live animals), Variation Wheels (automobiles), Variation Fresh, Variation Safe, DASH, DASH Heavy, Equation, and Equation Heavy.
     “We are also working on several premium product upgrades and new products coming soon.”

Best Surprise Is No Surprise

    “Cargo is a relationship business,” Pawel insists,” with our customers and within Delta internally.
     “What matters most is how you treat people. 
     “When I was solely responsible for temperature control products, specifically pharma, I found our customers to be very welcoming of my honest and transparent approach.
     “I was very candid about what we could or could not do; I don’t like surprises and neither do pharmaceutical customers,” Pawel Borkowski said.

Chuckles for April 4, 2016

Air Cargo News 40th Anniversary Issue

April No Fooling

JAL New Hires

  April 1st is a date when the unexpected can sometimes be revealed as an “April Fool’s joke.”
  So you can imagine the irony this past April 1st when Japan Airlines (JAL) President Yoshiharu Ueki (C) and newly hired employees held up their paper planes to celebrate the day at the JAL hanger at Tokyo's Haneda. Meanwhile, in the passenger terminal, furious customers were lined up to demand refunds of their money after a computer glitch fouled the day for thousands.

JAL passenger lines

Cairo Museum




Another Show
  A close-up view of a statue of a Scribe on display at the newly opened Cairo Airport Museum in Cairo, Egypt.
  The Museum includes 38 carefully chosen archaeological objects from the Cairo Egyptian Museum, the Coptic Museum and the Museum of Islamic Art.

If You Missed Any Of The Previous 3 Issues Of FlyingTypers
Access complete issue by clicking on issue icon or
Access specific articles by clicking on article title
Vol. 15 No. 24
Geoffrey Named FIATA Fellow
SWISSerific Posts Profits 2015
Chuckles for March 21, 2016
Cuban Cargo Havana Good Time
Vol. 15 No. 25
Standing With Brussels
Achim Says Auf Wiedersehen To The Americas
Chuckles for March 25, 2016
Oliver From Arms' Length

BER Two-Step

Vol. 15 No. 26
Celebrating Women's Month 2016
Get It On American
Chuckles for March 30, 2016
Steiger Was A Fighter

Vital Views For March 30, 2016

Publisher-Geoffrey Arend Managing Editor-Flossie Arend
Film Editor-Ralph Arend Special Assignments-Sabiha Arend, Emily Arend Advertising Sales-Judy Miller

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