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Family Aid 2020
   Vol. 20 No. 19
Tuesday May 18, 2021

Florida Customs Brokers & Forwarders Association

     We get it!
     Many of us are a bit tired of webinars and zoom calls.
     More than a few transportation people are chomping at the bit hankering to get on the road again; looking forward to days out on the hustings pressing the flesh, or bellying up to the bar swapping stories with old friends, whilst making some new ones.
     Who is here? Who retired? God forbid, who took it on the chin?
     Yes, we all crave the milk of human kindness by the quart for face-to-face contact in every encounter after a long unfamiliar lockdowned existence.
     But the reality is that COVID-19 is a demon, and that demon still controls life in some manner or form, more or less in various places as you move around the world.
     Being together is something we all want, but jumping the gun because of unyielding contracts to put on trade shows or meetings during this peculiar, life-changing scourge not seen in this world at this level in over 100 years, is both ill-informed and irresponsible.
     Attendance we learned was there for that National Customs Brokers and Forwarders (NCBFAA) Association Annual Meeting in person meeting May 6-8 in Fort Lauderdale, Florida.
     Now whether or not Florida gets an exemption in all of this is a good question. The “Sunshine State” seems to be from another world and has been full tilt boogie since the first cases of COVID surfaced almost a year and a half ago.
     Amongst several speakers at NCBFAA was former President of IATA CNS, Lionel van der Walt, who now serves as Global Chief Commercial Officer of Florida-based PayCargo, one of the hottest companies in air cargo and many other forms of transportation and business.
     No doubt the 600 or so eager participants of the NCBFAA Annual were in rapt attention as the always uplifting Lionel trained his keen eye on how the money will get handled globally as PayCargo changes that playing field forever….
     Elsewhere IATA is still keen to hold its annual and cancelled in 2020 World Cargo Symposium in Istanbul this October.
     Under one scenario, IATA people might be at the World Cargo Symposium by themselves. According to a source, Turkish Cargo tried to scrap its participation in the WCS event and was told it would be stuck for the money, so it reupped and decided to not cancel.
     As always, follow the money. IATA, we imagine, must be stuck with a contract to do a trade show, that is pay up or else.
     So, we can only wonder if IATA is holding the airlines liable because they are also being held by the throat to go ahead with WCS?
     If that is the case we can only hope that the airlines that support IATA Cargo get active and insist that this trade association stop this kind of nonsense.
     Nobody should have to fear for their life to attend a trade show.
     Right now, Turkey is in massive COVID-19 shut down, for crying out loud. So is India and elsewhere.
     The way we see it now and into the rest of 2021, Istanbul for a trade show is a non-starter.
     When you think about it a bit, the U.S., the lead for the vaccinated world, is only about 37% vaccinated.
     So that puts most other nations, including hot spots and places where variant COVID-19 is popping up, as still problematic.
     Common sense says, who in their right mind is going to travel to a trade show?
     Even Florida, where some events are taking place currently, might for 2021 be better off, not filling up with people from all over the world.
     This October we, here in the U.S., will get booster shots to protect against further COVID and then a couple of weeks later our regular winter flu shots.
     Yes, during this time, we are living in a world that for all intents and purposes is shot to hell.
     The idea that any of us are really immune to all of this should be at least guarded. A bit . . .
     Newly named Director General of IATA Willie Walsh, we hear, is in there to shake things up. He might weigh in here and make a difference.

chuckles for May 18, 2021

Underworld at IndiGo

     Indian aviation is passing through its most difficult phase.
     In a financial crunch even before the pandemic started, with the second run of Covid this time around, the aviation sector is predicted to see possible downsizing or as Reuters put it, “have their planes repossessed by lessors as a surge of COVID-19 infections roils travel.”

Forwarders Apprehensive

     As metro cities Mumbai, Delhi and Bengaluru go for stringent lockdowns, forwarders are apprehensive.
     The lockdowns are certain to impact manufacturing and push air freight down. To top it all, fewer flights will mean space constraints and higher rates.
     Passenger numbers have been going down steadily. Ratings agency ICRA pointed out that for April 2021, domestic passenger traffic has been estimated at around 5.5-5.6 million. That will be a decline of around 29 percent compared to 7.82 million in March 2021. Simply put, the domestic passenger traffic will be lower than the October 2020 levels.
Kinjal Shah     On the part of the airlines, capacity for April 2021 was lower by around 15 percent compared to March 2021 (around 60,300 departures, against 71,300 departures in March 2021). That shows the declining demand scenario arising basically from fliers unwilling to risk travel by air due to the rise in Covid-19 infections. Incidentally, domestic airline operations were shut down completely during April 2020.
     Kinjal Shah, (left) Vice President & Co-Group Head, ICRA said that “the number of flights departing has also gradually declined from February 2021 onwards, with the average daily departures close to 2,000 in April 2021, down from 2,300 in March 2021 and February 2021.
     “The average number of passengers per flight during April 2021 was 93, against an average of 109 passengers per flight in March 2021.”

Capacity Going Up

     This despite the fact that the Ministry of Civil Aviation (MoCA) permitted increasing the capacity gradually from 33 percent, with effect from May 25, 2020, to 80 percent, with effect from December 3, 2020.
     The 80 percent increase continues till May 31, 2021.

The Cash Flow @ IndiGo

     In such circumstances, the country's largest cash-rich carrier (by pax numbers) IndiGo has decided to raise equity to tide over the crisis.
     In a letter informing the National Stock Exchange of India Limited and the Bombay Stock Exchange, on May 10, 2021, InterGlobe Aviation (IndiGo's parent company) said that the “Board of Directors of InterGlobe Aviation Limited … approved the raising of funds for an aggregate amount not exceeding INR 3,000 Crores (Indian Rupees Three Thousand Crores/USD$450.941 million) through an issue of equity shares…”
     Incidentally, the move came barely months after IndiGo's parent Interglobe Aviation discarded plans to raise up to $543 million in January this year when the situation was better and a faster recovery in air travel was seen.

PAX Numbers Tanking

     With passenger numbers decreasing every day, Reuters quoting an analyst said that “cash burn is expected to rise to $3.4 million a day, a level last seen in September from $2 million a day at the end of 2020.”
     IndiGo will be able to weather the turbulence but it is the smaller carriers that will be most affected. With little or no government assistance, the smaller carriers would need help. And with deaths all around, fewer jobs and incomes coming down, the comeback to domestic travel will be delayed, in fact, according to analysts, not till the first quarter of 2022.

International India Flights At Nil

     Worse still is the fact that there is hardly any international travel.
Almost all nations have stopped Indians from flying in. The charter flights that operated in the air bubbles, including to the UK and U.S. too have been stopped. These charters provided revenues to smaller domestic carriers like SpiceJet and others. International traffic will be expected to reach pre-COVID levels only by 2024, according to CAPA.

Underworld CarGo at Indigo

     What then about cargo?
     IndiGo that referred recently to its cargo activity below deck, as life in the ‘underworld’ is keen to ramp up its cargo operations.
Ronojoy Dutta     As CEO Ronojoy Dutta pointed out some time ago, “CarGo (that is IndiGo's cargo division) has been a success story over the past year, creating new records, but our belief in the cargo business goes beyond the special circumstances right now.”
Recently, the carrier signed a letter of intent for two A321 passenger-to-freighter conversions and is looking out for two more planes.
     These aircraft, the first to come online by June 2022 will join IndiGo's fleet of more than 280 aircraft.
     Because of COVID-19, the affect on air cargo is being felt with international airlines stopping flights from and to India.
     With fewer passengers, domestic routes would also see fewer flights.
     The reduction in belly space for cargo due to fewer passenger flights is having an impact.
     Can the cargo-in-cabin flights make it up?

SpiceJet Express

SpiceJet Discovers Cargo

     SpiceJet, which has ramped up its cargo services in the last year-and-a-half, said that it has done well as far as passenger and cargo services are concerned and that it had enough cash to keep flying. The cargo division SpiceXpress has 19 cargo aircraft, including five widebodies. Even so, it has started meeting investors for further capitalization. There are reports too that SpiceJet expected compensation from Boeing for the 737-MAX aircraft it was supposed to receive.
     In such a situation, if lessors demand to be paid on time and are adamant about not writing off debts, the smaller carriers in India would have a very tough time.

Executive Roulette @ Lufthansa Group  
  “Executive Roulette,” or maybe were it true, “It Happened in Monte Carlo” would serve as a better headline here as from left, Dieter Vranckx, who was top executive at Brussels Airlines is now CEO of SWISS, and Peter Gerber, former CEO of Lufthansa Cargo sporting a new salon look, did some soft shoe terpsichore over to Dieter’s old job at Brussels. Meanwhile Dorothea von Boxberg who is the first woman boss at Lufthansa Cargo can only smile as the Lufthansa Cargo operating profit for last year landed at €772m shattering by more than double a previous record of €342m set in 2010.
Dave Doehler
  June 30, 2021 is approaching fast when security rules change, meaning TSA will require all outbound international air cargo carried by commercial aircraft operators (passenger and all-cargo) to have enhanced security controls as directed by ICAO.
  “We can help,” says Dave Doehler, Deputy Director, SOC Canine Training located in Virginia, USA.
  “Our strong success and long history (75 years) working in some of the toughest environments in the world can deliver full scale cargo screening canine operations, just when the airlines will need it most,” Dave assures.
  More, click here.

FlyingTalkers Podcast

IATA Trade Show Reality Check

Underworld At IndiGo

The Weight

Joachim Frigger


For our dear, departed friend Joachim Frigger.
April 19, 2021.

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