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   Vol. 18 No. 64
Friday October 11, 2019

United Cargo Ad

Virgin Cargo

Dominic Kennedy“Our volumes grew 6% in 2018 to their highest level since 2010 and we know customers would give us a bigger share of their business if they had the choice.”
     Dominic Kennedy, Managing Director, Cargo at Virgin Atlantic is animated as VS unveiled an ambitious plan to challenge IAG’s dominance at London Heathrow.
     Virgin Cargo said its master plan moving forward will significantly increase its long-haul route network and launch a new comprehensive variety of short haul domestic and European routes when the airport expands.
     Virgin is promising the travelling public more choices and for cargo customers more value whilst exporting and importing goods through the UK’s biggest air cargo gateway.
     “At this pivotal moment for the UK economy,” Dom Kennedy continued, “it is vital that our cargo customers as well as manufacturers, importers and exporters have access to the widest choice of routes and services and enjoy all the benefits that fair competition brings.
     “The changes we are calling for will deliver this,” Mr. Kennedy assures.

Change Is In The Air

     Future Virgin Atlantic route maps shows an explosive, no holds barred intention to serve up to 84 new destinations in the UK, Europe, and across the globe when the third LHR runway is completed, or a fourfold increase on its 19 long haul destinations from Heathrow in 2020.

Lookout For Number Two

     Heathrow currently sees over 70% of the UK’s air cargo trade, totalling 1.7 million tonnes annually, a figure projected to grow to 3m tons by 2040.
     “By value, over 30% of British trade flies through the airport, worth more than £100 billion a year, with 95% carried in the bellies of passenger aircraft,” Virgin declared.

Step Change Lifts Cargo & PAX

     Virgin Atlantic’s new route maps illustrate how the airline’s flying program could grow to deliver a step change in choice for passengers and cargo customers, but only if the Government reforms the way new Heathrow slots are allocated to enable the creation of a second flag carrier at the airport.New Horizons
     The Virgin plan represents a fourfold increase on Virgin Atlantic’s current international network and includes exciting unserved destinations such as Kolkata (India), Jakarta (Indonesia) and Panama City, (Panama), as well as offering more choice on prime cargo routes such as Accra, Austin, Buenos Aires, Cape Town, Osaka, Raleigh Durham and San Diego.
     In total, Virgin Atlantic plans to serve 103 domestic, European and long-haul destinations. Of the 84 new destinations planned, 12 are domestic, 37 are European and 35 are global.

Virgin Spells Relief

      Shai Weiss, CEO Virgin Atlantic, puts it this way:
     “Never has the need for effective competition and choice at Heathrow Airport been more evident than during this summer of disruption, which has brought misery for tens thousands of travellers and impacted cargo supply chains.
     “Britain, and those who travel and trade with it, deserve better than this.
     “Air passengers and cargo customers need a choice and Virgin Atlantic is ready to deliver when Heathrow expands,” Shai Weiss added.

High Road To Tel Aviv

     In a related development Dom Kennedy said:
     “We are delighted to welcome Tel Aviv to our network. It is an important cargo route and we have been extremely encouraged by the level of interest and bookings for both our direct services between London and Tel Aviv and the U.S. connections we now offer over our London hub.”
     Virgin Atlantic’s first flight to Tel Aviv touched down at Ben Gurion International Airport September 25.
     From now on Virgin Atlantic’s daily Airbus A330-300 flights offers 20 tons of cargo capacity to and from London Heathrow.
     “Fast connections with Virgin Atlantic’s network serving major gateways in the United States, Israel’s biggest trading partner, and strong support expected from freight forwarders, we are confident, will gain a healthy share of the high volumes of pharmaceutical, e-commerce, express and valuable shipments as well as high-tech products, fresh produce and other general cargo,” the carrier said.
     Dominic Kennedy concluded:
     “Virgin Atlantic’s cargo capacity ex Israel is being marketed by its GSSA partner, WTA Aviation, while Swissport is providing cargo handling services in Tel Aviv.”
     Later this month (October) will see further expansion of Virgin Atlantic’s long-haul cargo network when it recommences daily London-Mumbai services and, in early 2020, the airline will begin its first operation in South America with a new daily London-São Paulo route.

Virgin Cargo New Heathrow Facility

Rafael Figueroa and Tania Boyes   Virgin Atlantic Cargo and Delta Cargo describe their just opened export facility at London Heathrow as “state-of-the-art to future-proof the joint venture’s growth plans in the U.K. market.”
Tania Boyes, Director - Cargo Operations at Virgin Atlantic, puts it this way:
   “We now have an export operation at our main U.K. hub which is designed around the current and future needs of our business, and which will further improve customer experience.
   “By embracing new technology and ways of working, the building gives us the capacity to grow efficiently as we enter the next exciting phase of expansion for Virgin Atlantic.
   “This is supported by new technologies that will enhance business continuity, as well as deliver significant improvements and transparency in the customer delivery experience.’
   “World Class” enthuses Rafael Figueroa, Delta Cargo’s Managing Director Operations and Customer Experience.
   “These world-class expanded facilities position us for success in this important market.
   “The technology enhancements and the transparency across the export operation, with increased temperature-controlled facilities, are designed to make it easier for our customers to work with both airlines.”
   Seen through a fish-eye lens, the new purpose-built facility takes the word “terminal” out of an air cargo handling address by delivering an all-capable transfer facility of the future, today.
   As example, trucker access has been well thought out, meaning drivers no longer need to leave their vehicles to complete documentation processes but rather are assigned to a cargo door to offload their freight. Drivers also receive text message updates to help expedite cargo deliveries.
   Real-time acceptance, using the operation’s door management system and hand-held technology also provide instant freight status update messages for customers to confirm their cargo is being handled and flown as planned.

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Rob Walpole

Delta Cargo had just named Rob Walpole as Vice President – Cargo Operations and Logistics.
     Mr. Walpole lands at DL Cargo with heavy credentials including a stint at DP World Dubai where he served as Chief Operating Officer and prior to that as Chief Executive Officer at Schenker.
     Rob Walpole gets it about change and judging by his recent move and his answers here he is turning an important page moving ahead affecting the future of a great international airline.

On Change

     “A couple of things from my background - having lived and worked globally, and my most recent background in the Logistics and Supply Chain industry I think will be tremendously helpful in my new role at Delta.
     “Delta Cargo is a part of a global business – understanding some of the landscape, challenges and cultural nuances of our markets can be helpful in working with customers and our people.
     “From a Logistics and Supply Chain perspective – the industry is solution-focused and one that will likely change in the next few years, with Delta well placed with some very innovative solutions, and I hope I can help the company on that journey.

Surprising Delta

     “I chose to join Delta because of its reputation as a great place to work, with a great leadership and organizational culture.
     “The surprises to me are firstly, just how much the company is ‘customer-led’, with the strategy of the business truly led from a ‘voice of the customer’ perspective.
     “Lots of companies say that, but Delta truly lives that.
     “The other surprise (and maybe it shouldn’t be) is the way that Delta efficiently manages a tremendously complex operational network.
     “This comment is not just about the Cargo business, but the whole company – it takes a lot of talented leaders and a committed organization to execute effectively at the top of the industry, in such a complex environment.

The Book On Leadership

     “Many things are important to be a great leader, and leadership is an area where I try to read widely and broaden my perspective. “One key leadership trait I read about a few years ago, and strongly believe in is ‘the pursuit of clarity’.
     “It doesn’t mean clearly telling people what to do – in fact it is the opposite.
     “The act of ‘pursuing clarity’ from a leadership perspective means you need to always be talking with all stakeholders to solicit feedback, discuss alternatives, understand customers, in order to craft - and lead an organization towards - clearly established goals in a clear manner.
     “And when conditions change (which they will), you need to recycle the practice. Done thoroughly and properly, it drives a tremendous amount of good leadership behavior.”

Uppermost In Cargo Matters

     “Collaborations are critical.
     “For lots of reasons, but there are two primary ones for me. Firstly, in line with the earlier comment on industry solutions and future disruption – successful execution of future supply chains (and also today) requires complex collaboration between a number of participants.
     “Having a foundation to do this effectively is key, and this is equally applicable for Delta.
     “Separately, the battle for talent and supporting future organizational development is also a collaboration-based venture.
     “Ability to collaborate in order to build effective networks, talent pools, communication channels etc. is critical in order to build organizations to support future growth,” Rob Walpole concluded.

Matt Weisenburg  Delta Cargo named Matt Weisenburg Director – Cargo Strategy and Alliances, and Mark DeFrancesco as Managing Director – Revenue Management, Capacity and Forecasting.
  Matt, moving up fast, has been at Delta Cargo over the past three years serving atop cargo alliances, strategy and development, pricing and revenue management .
  Matt, an 18 year DL veteran includes serving as Director of JV Transatlantic Pricing for the Delta, AirFrance, KLM and Alitalia Joint Venture.

Chuckles for October  11, 2019

Trump Effect Pressure On China

  A lot has happened since my last article on the Trump Effect.
  The ambitious Trump economic agenda has already started paying off – the U.S. is seeing record low unemployment, robust GDP growth and, for the first time in over a decade, consistently rising wages. Likewise, his muscular anti-immigrant stance has reduced illegal immigration and his forceful brinksmanship on trade has led to more balanced exchange with Mexico.
  But there’s been some turbulence on the ascent. Wall Street has lately been on a roller-coaster ride with analysts struggling to determine the next moves necessary to sustain revenue growth.

Pressure On China

  International political developments are also affecting America’s economy.
  China continues to challenge the U.S. politically and economically, insisting on keeping the Yuan devalued to promote its exports whilst stealing American intellectual property, and imposing unfair restrictions on access to its domestic market. President Trump has increased pressure on China through aggressive tariffs.
   While some firms have criticized his strong policy, trying to benefit from his tax breaks while wanting to keep their production in low-cost China. The responsible solution would be to reinvest their tax savings to move operations back stateside, creating jobs and putting more dollars in consumers’ pockets.

Hopscotching The World

  Other international challenges are also taking their toll. The recent refinery attack in Saudi Arabia has caused oil prices to jump overnight. The U.S. intelligence community has blamed Iran for the strike, with tensions increasing as President Trump applies “maximum pressure” to dissuade their bad behavior.
  Afghanistan’s future remains uncertain, as the U.S. refuses to drawdown irresponsibly, which would recreate a Taliban-led terrorist safe haven. North Korea and ISIS have slipped from the headlines, but they remain active risks.

America First Impacts Cargo

  The airline industry is experiencing some turbulence of its own. The industry is trade dependent, and President Trump’s ‘America First’ approach to trade has hurt cargo business with China and Mexico, which were among the United States’ top three trading partners. The decline in those markets has prompted carriers to shift into other routes, leading to oversaturation with decreases in yield and profitability.

Virgin Richard Said It Best

Warren Buffett and Richard Branson  Many observers say this is only a short-term problem and reorganization will benefit industry in the end. But this obscures a major underlying fact—you look at the last 20 years of aggregate airline operation, you will be surprised to find the whole sector runs a net loss.
  Commercial aviation has always been a challenging sector, with very price-sensitive consumers and high-fixed costs.
  Even in the best of times, executives struggle to turn a profit. To quote Warren Buffett,
“The best thing that could have happened for the airlines is that the Wright Brothers aircraft got shot down on its test flight.”
  Sir Richard Branson, owner of Virgin Atlantic echoed this sentiment when he said:
“The way you turn billionaires into millionaires is to have them buy an airline.”
  While President Trump’s policies do impact the industry, they are not the underlying cause of carriers’ profit problems.
  If you want to discover the real reason so many airlines struggle, you need to look within the industry and find out why it keeps on making the same mistakes over and over again.
  That will be the topic of my next article.
Bill Boesch

To Read Part 1 of This Series, Click Here
To Read Part 2 of This Series, Click Here
To Read Part 3 of This Series, Click Here
To Read Part 4 of This Series, Click Here
To Read Part 5 of This Series, Click Here
To Read Part 6 of This Series, Click Here
To Read Part 7 of This Series, Click Here
To Read Part 8 of This Series, Click Here
To Read Part 9 of This Series Click Here
To Read Part 10 of This Series Click Here
To Read Trump Effect—India Walks Softly Carries Big Stick, Click Here
To Read Trump Effect—Implications Of A Trump Trade War, Click Here

To Read Trump Effect—Trump Across The Pacific, Click Here

Bill BoeschBill Boesch is an air cargo pioneer but also a dreamer & doer across a distinguished and exemplary 40 plus year career. Bill served as President of American Airlines Cargo where he put that carrier on the world stage during the Robert Crandall era.
     Bill is also a key logistician for U.S. military forces who during the Iran & Iraq conflict created methodologies in transportation that delivered the goods while saving lives.
     For his effort Bill was awarded The Medal of Freedom at a ceremony on Ellis Island in New York harbor, in the shadow of the Statue of Liberty.
     Among his other activities, Bill has contributed a series of eleven articles exclusively to
FlyingTypers offering his unique knowledge and perspective into the ongoing impact that the administration of President Trump is delivering to business and air cargo.

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