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   Vol. 21 No. 25
Thursday June 16, 2022

Eduardo del Riego

     Logistics payments and data infrastructure platform PayCargo has announced a new investment of up to $130M from funds managed by Blackstone Growth (BXG). BXG’s investment will support the company’s continued expansion both domestically and internationally, development of new products, as well as potential growth opportunities through M&A.
     “PayCargo is a category leader, operating at the intersection of several of our highest-conviction investment themes – including the continued proliferation of electronic payments, the digitization of the supply chain, and the modernization of business-to-business payments,” said Vincent Letteri, Senior Managing Director and Head of Financial Services for Blackstone Growth.
     “We believe that these attractive tailwinds, combined with the strength of PayCargo’s offering, positions the company well for its next phase of growth.”
     Blackstone, through its private equity, infrastructure, and real estate businesses, has invested significantly in the broader logistics, supply chain, and e-commerce space, including acquiring a leading port operator in North America and over 1.1M sq ft of warehouse assets globally.
     “Our partnership with Blackstone plays an important role in furthering our commitment to transforming the movement of goods and fostering increased efficiencies through PayCargo’s payment platform. Like Blackstone, we share the same mission and vision – serving the needs of our customers by building the largest independent freight payments network. Blackstone’s experience in the logistics, supply chain, and e-commerce space, will be invaluable for PayCargo as we continue to expand globally,” said Eduardo Del Riego, PayCargo CEO.
     PayCargo’s cloud-based payments network enables payers to quickly and securely pay air and ocean carriers, maritime ports, ground handlers, freight forwarders, and customs brokers, among others. PayCargo integrates with over 50 leading Transportation Management Systems (TMS), Enterprise Resource Planning (ERP), and Terminal Operating Systems (TMS) entities across various transport modes: Ocean, Air, Rail, and Trucking. Today, PayCargo’s network of more than 40K businesses is the leading independent payment platform focused on expediting the movement of cargo in North America and is rapidly expanding in Europe and other regions.
     Profitable since an early stage, PayCargo continues to invest to support this hyper-growth. PayCargo’s innovative new tools include advanced real-time customer reporting and invoicing, new workflow tools to streamline partial payments and reconciliation, advance payments, and automated refunds in any currency.

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Ram & Des What Old Friends Do

Guillaume Halleux on WeQare

     On Bedford Street in Manhattan is a wonderful ancient passage that runs for some blocks parallel to Hudson Street.
     There is a beautiful wooden frame home on Bedford Street right down the block from Chumley’s, a great writer's saloon and at one time a stop on the Underground Railroad that until the end of the U.S. Civil War worked to free slaves.
     At one point Bedford passes by Public School Three (PS 3) where etched in stone are the words “ Childhood Shows The Man", from the 17th century poet John Milton.
     As schooIs in New York City are emptying out for Summer 2022, I have been thinking, as have many parents about children, and watching with great interest a unique and earnest effort for children by Guillaume Halleux, Qatar Airways Chief Officer Cargo:
     “Children are the future generation and we hope that they bloom and develop their full potential.
     “Not all children are born with the same opportunities, but every child has the right to dream.
     “To make their dreams a reality, Qatar Airways Cargo wants to gather forces to support this next generation in need, by sending them toys, educational materials, and sports items so that all children can enjoy their childhood," Guillaume declared.
     When Qatar Airways Cargo delivered the third in its groundbreaking WeQare sustainability campaign branded “ Let's Stand Together”, an idea of seeking donations for children that focused on education, sports and fun may have seemed a simple enough goal, but in this often glum, hard bitten year of continued COVID and War, we thought, well why not?
     So the call “Let’s Stand Together” for children went out and Qatar Cargo set its system to collect donations with each station featuring its own collection point.
     At home Qatar Airways Cargo opened six donation collection points for its employees as well.
     So what did they ask for and get?
     WeQare collected study material (books, school bags, pencils), clothes and sports items (socks, soccer balls, sneakers, jerseys) as well as toys, musical instruments, and board games from around the world and then redistributed them globally as well.
     The Beach Boys song “Surf's Up” by Brian Wilson & Van Dyke Parks sums it all up:
               “A children's song
               “Have you listened as they played?
               “Their song is love,
               “And the children know the way!”

     Bravo Qatar Cargo!

Chuckles for June 18, 2015

Ram Menen

     In late May we wrote of the enduring friendships formed by people in transportation that outlast companies, careers, and in the case of Ram Menen and Des Vertannes, still going strong with expansive thinking and on point after 40 years.
     We asked the gentlemen about some current issues in cargo.
     Here Ram Menen opens up on a variety of subjects.
     Who is Ram Menen?
     Ram and his team built Emirates SkyCargo from the ground up; from a couple of leased in aircraft in 1986 to one of the world’s mightiest air fleets and a top market share, when Ram retired in 2014. Mr. Menen is also the visionary industry leader that reenergized TIACA when Dubai hosted TIACA’s Air Cargo Forum in 1996.

FT:        Best definition of Sustainability you might share?
Ram:   Sustainability has become a buzz word that people are using all the time, sometimes with no understanding of reality. The rush to conserve resources long term has got to be the objective, however, I find some of the targets set are not really achievable, e.g. the move towards SAF. The challenge is that there simply isn’t enough production to cater to the demand and is a lot more expensive than the current fossil fuel. Can an airline sustain such expenses and still be competitive and survive ? I don’t think so . . . what is happening at the moment is more PR-generated, not reflecting the reality. Same goes with Hydrogen cells and electric engines. Still a lot of R&D has to go into creating SAF as affordable fuel and I would say targeting 2035 to 2040 would be a more appropriate goal.

FT:        Moving ahead, Emotional decisions in Business versus Process Mining, or is there room for both, and if so in what measure?
Ram:   Pure emotional decsions can be detrimental to business process. Emotions can make you subjective, however in business, objectivity has to rule. To have a great team all around, a mix of subjectivity and process/data mining is very important to create the basis for objective decision making. You have to add a touch of subjectivity in the process to keep the team together. In short, subjectivity is human and allows for good human interaction but when it comes to decision making, objectivity should be the prime criteria.

FT:        What can be improved in 2022?
Ram:   Improvement is a continuous process. 2002 sees the world healing and coming out of a world shut down. Though it has had negative effects on life and trade, it has also had a lot of positives. It has transformed human behaviour. More people are now used to buying anything and everything online. It has accelerated the growth of e-commerce and people, and companies have realized that you don’t have to be in an office envioronment all the time for a company to function.      Working from home or working remotely is equally effective in most cases. It has also proven to be very productive and has also helped in creating a work/life balance. Working within a hybrid model can be very beneficial for companies, which can shed expensive real estate and save on costs. Supply chain operations have been badly disrupted and folks have been working on patch works to accommodate capacity constraints as well as shutdowns of production.      
     We will need to be vigilant to work on adapting the original supply chain management aspects by incorporating the new lessons learned, thus improving the old processes. In the air cargo industry, digitization has to be a very high priority.

FT:        What if air cargo keeps things the same and does not do anything?
Ram:   Those who don’t change or make the changes, are likely to be extinct in the future. Digitization is a key element in today’s transactions and will be the norm going forward. Digitization also facilitates active implemenation of artificial intelligence which can help make the physical, as well as, decision making processes more efficient resulting in improved cost efficiency. Those who don’t change will carry the burden and drown in legacy costs rendering them noncompetitive in the market.

FT:        What did you want air cargo, airlines, forwarders, other cargo resources and truckers to know about that they may be missing ?
Ram:   The demand created by the pandemic and the resultant lack of available lack of capacity has, in the short term, allowed yields to improve. It was long over due for the airlines. However, greed/opportunistic activities have raised the cargo rates to an all-time high and bred arrogance.     This, in the long term is not sustainable as it contributes to the rise in inflation and at some stage, the market will not be able to afford the inflated cost of logistics and the demand will wane. And as the capapcity slowly comes back, we will all sink to pre-pandemic era levels, which will be detrimental to the airline air cargo industry in the longer term. It is in the industry’s interest that trade volumes continue to grow.

FT:        What have you learned in retirement you wish you knew during your career?
Ram:   I guess, the biggest lesson has been that there is a life out there that I knew nothing about. Having said that, there wasn’t any other way we could have accomplished what we did. Being out of the game, one gets a better overall perspective of the industry as one is able to see all aspects of the game . . . it is like sitting in a gallery seat and being able to see the entire game rather than what is immediately around you while on the job.

FT:        Proudest moments during COVID? Most worrisome? How has COVID changed air cargo?
Ram:   The proudest moments during Covid was how the air cargo industry came into its own and became the lifeline for survival, reacting with great speed to keep the world connected. They helped bring in more capacity by deploying Preighters. Air cargo kept a lot of airlines alive when the pax business was shut down and helped with the airline’s recovery process. What was worrisome is what the cost of logistics was doing to the end product and the consumer. The importance of aircargo to any airline operation was very obvious and has been the subject of discussion in many airline Boardrooms. Pax airlines who have treated air cargo as marginal business are now more focused on developing their cargo business. Covid has given a boost to the airline cargo industry, which, hopefully will result in increased available capacity for air cargo to grow.

FT:        If you could have your career again what would you do differently?
Ram:   If I had to start all over again, I don’t think I would do anything any differently. What we did was build a strong foundation and platform for the air cargo industry to grow without any constrains. It was/is an evolutionary process.

FT:        As you look at the global market and consider options, what is exciting?
Ram:   The excitment comes from the evolutionary/revolutionary changes taking place in technology that allow us to manage logistics and transportation more efficiently. The move to create more independence from reliance on China for manufacturing activities; new markets in development; changes to ecommerce; and bricks and mortar buying creating more demand for air cargo . . . all of these are very exciting and challenging shifts.

FT:        What about Russia?
Ram:   Russia’s senseless invasion of Ukraine will change the dynamics of the market place. Depending on how long this war goes on, the world could be thrown into a massive recession. It has basically divided the world. Depending on what happens/how long this war will continue, whether the war spills over to other countries/teritories, we could in the long term impair trade and commerce. At this stage it is very difficult to predict what the outcome is likely to be.

FT:        Is One Record the totem for which IATA decided to ditch its IATA FIATA program? Was the entire IATA FIATA negotiation just a straddle strategy?
Ram:   The One Record initiative actually goes to facilitate improved communication and brings better efficiency in the transactional process. I don’t think it had anything to do with the breakdown in communication between IATA and FIATA.

FT:        Regarding their negotiating power with the airlines, many forwarders say they are worse off today than they were ten years ago, is this correct?
Ram:   Of course at this stage, when available capacity is very limited, their negotiating power is very limited and the suppliers, in this case the carriers, call the shot. Then again, the last two years and the next couple of years cannot be taken as the norm. This is an anomaly right now and cannot be used to determine long term trends. Once there is sufficient capacity in the market and supply and demand start getting back to normal cycles, freight forwarders will be able to negotiate better terms.

FT:        Why are U.S. forwarders different from the rest of the world, why have they not had any interest in joining forces in FIATA? If forwarders were united globally, could this have a different significance for IATA?
Ram:    the U.S market in itself is such a huge market, a world of its own, that forwarders tend to focus more internally than externally. They have their own associations that deal with their unique affairs. Even IATA has its own sister association CNS that only deals with the U.S. market. They are in a cocoon of their own. I don’t think their coming into FIATA would make much of a difference.

FT:        Airlines have suffered during the pandemic, and IATA was not very vocal, appearing to be at a crossroads. Discussing health measures with authorities, in particular with the WHO, was not always as straightforward as IATA’s mission statement boldly declares. What is missing in IATA for it to establish itself as the reference model in a global emergency?
Ram:   IATA Cargo seems to have lost the ball a bit. Their focus has been in trying to deal with governments in opening of borders rather than focusing on world trade, which to be honest, was very robust and grew to normal volumes very quickly. Looking in from the outside, I see them focusing more on operational aspects, rather than facilitating commercial/trade related activities. I hope they can maintain their relevance as we go into the future.

FT:        With few exceptions, the balance of power in the market between traditional airlines, who are typical IATA members, and other operators has changed substantially in recent years and is still changing. Is this conversion reflecting the attitude of the traditional airlines or IATA’s deficiencies?
Ram:   Very relevant point. Today the landscape of operators is changing, there are the traditional airline, integrators, e-commerce operators, LCC (low cost operators) and shipping lines who are also adding air to their portfolio. Traditional operators have been the slowest to change.      Barring a few, especially the passenger airlines have not really kept pace with the changing envioronment. Folks like Amazon CGA-CGM are going to eventually force the changes. They are small in numbers at the moment and the traditional airlines still tend to dominate the air cargo operations, so they aren’t predisposed to change their attitude.

FT:        For many years, airlines publicized their services with an aura of wealth, consumption, luxury and even a lack of consideration. Has the time come for operating with consciousness, with total respect of society and environment, or are we carelessly flying into the abyss? What can be done to show the way?
Ram:   I don’t think it is fair to say that the airlines have not been operating with conciousness or with total respect for the society and environment. As I had mentioned earlier, they have been singled out as polluters and then burdened with various kinds of taxations, eroding their margins. They tend to operate in an extremely regulated and competitive market where survival is a challenge. From an environmental and sustainibility view, they have come a long way and are continuing to do their best within the cost constraints they have to exist in. You just have to look at engine technology, which continues to improve in fuel efficiencies. What can help further improvements is for the governments to invest a bit of the tax money they collect into avaiation-related infrastructure.
     The development of more cost-effective unmanned commercial freighters like Natilus will bring in further efficiencies and contribute better to sustainability.

Air Cargo India

Need more proof that COVID is still out there? Although in some cases people are reluctant to come right out and say “I have COVID” we are getting reports from attendees of Cargo Network Services Corp. (CNS) held in Phoenix May 23-25 and also Air Cargo India Mumbai May 31-June 2, by people, who after flying home, a few days later are coming up sick, bitten by the pandemic despite being vaccinated several times . . .
  We note that in all the pictures from both Phoenix and Mumbai, almost no one was wearing a mask.
  That is not only just plain not thought through, the consequences can also be life threatening. What is particularly distressing here is the irrational reluctance by some to the wearing of a K95 or better mask as safeguard.
  Ahead at the airport level all over the world are monthly cargo club meetings although that action lessens a bit during summer.
  Also ahead on the calendar in 2022 is International Air Transport Association (IATA)’s World Cargo Symposium during September in London and The International Air Cargo Association TIACA’s Air Cargo Forum in Miami during October and The FIATA International Federation of Freight Forwarders Associations World Congress for 2022 is scheduled for September 14 in Busan, Korea.
  The Washington Post reports that “the Biden administration is warning the United States could see 100 million coronavirus infections and a potentially significant wave of deaths this fall and winter, driven by new omicron subvariants that have shown a remarkable ability to escape immunity.”
  People don’t like to talk about it and for air cargo events there is no central clearing house. But, up and down the line, people are still contracting the disease.
  The rub for nearly everyone are the mandates.
  Perhaps if people decided that wearing a mask Is an act of self-defense . . .
  Masks work and worn correctly can save you a nasty couple days of a really big hurt with lingering impact that can continue for some time.
  What you will discover with COVID is that you cannot be reckless around it.
  With COVID there is nowhere to run, nowhere to hide.

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Vol. 21 No. 22
Amar Is The Phoenix At CNS
Chuckles for May 25, 2022
Memorial Day 2022

Vol. 21 No. 23
Bharat Thakkar Heart Passion & Wisdom
Another Opening Another Show
ATC Hosts VIP Lounge
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Vol. 21 No. 24
May Was The Month That Was
ATC Best In Show
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