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   Vol. 23 No. 25

Tuesday May 28 2024


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FIU Students

FIU students on a recent trip visited American Airlines Cargo and DFW Airport to see the actual operations; forwarders in the local community also made themselves available.

Mike White     Mike White needs no introduction with our readers. Mike has a CV and presence in the aviation and airfreight industry that is second to none. His tenure in CNS as President was most inspirational for all of us.
     Everybody knows Mike White: his presence is immediate wherever he goes.
In other words when it comes to clear thinking and realizing where we are or should be heading as an industry:

We Like Mike!

     The question today is that in a business that needs lots of young executives whose attention may be drawn to other careers, where will the next generation of air cargo executives will come?
     Grateful that Mike sat down with us and answered questions with regard to his current activity at PayCargo and at his role as a driving force for that company’s involvement at Florida International University (FIU).
     The idea here is to learn and share a yeoman and pioneering effort by PayCargo via its involvement in FIU to develop and build vocational and educational programs, for the next generation of logisticians.

Developing Future Logisticians

     As example, how does FIU insure that the programs they advance remain up-to-date and relevant in the fast changing business climate?
     We also asked Mike how can one get involved in this initiative and what are the expectations, milestones and events?

Time Is Right

     Interestingly there were several points that connect this conversation with some of the comments and statements we heard at FIATA during the recent HQ meeting and at TIACA in their Brussels meeting held at the end of 2023.
     Mike declared the main objective to involve PayCargo within FIU is to help their program grow and become a world class logistics program, in order to get students to share in the real world, to understand the need for the industry, so they are actually better prepared to get into the workforce.
     “The university and the school of business offers a multi-modal atmosphere particularly focused on transport.”

Gregory Malloy, Steve Smith, Michael White, Lord David Cameron and Eduardo Del Riego

The Heart of the Matter

     Eduardo Del Riego, CEO of PayCargo, was a FIU graduate and devised a cooperation with FIU with the goal of supporting the university to achieve the objective of a top-notch program for today’s logistics; previously Eduardo had worked with the Dean in the school of business, Dr. Joanne Li, now Chancellor at the University of Nebraska at Omaha.
     At the time that Mike was still at the helm of CNS, both Del Riego and Li came to him to understand how his experience could help the university program to grow and become an outstanding program.

Never Too Early To Learn

     “At the time, I had previously worked with universities on internships, I saw that the students were not prepared for the real world, so it became more and more obvious that if you had to retrain the candidates you had hired, you were almost obliged to re-educate them . . . ”
Marco Sorgetti     Mike’s reasoning was proof of a rather common situation, which I can assure our readers is not peculiar to the U.S. alone: there is a gap to be filled between educational programs and what is actually required on the job.
     That situation was pointed up by Marco Sorgetti, (left) FT Senior Contributing Editor/Special Commentaries, who shares his current first-hand teaching experiences:
     “My students in Italy seem to have the same issues, and I heard similar comments during the meetings at FIATA’s HQ Meetings last month.”
Banking on the accumulated experience, FIU’s program is running its second year and will surely continue capturing more and more interest.
     Mike explained that education programs may even have to consider personalization issues, quoting the example of when he was at United:
     “We had three interns from three different universities and we realized that the student who had been trained in Knoxville was too FedEx specific to be inserted in our program without re-training,” Mike declared.

Too Soon To Know It All

     Another issue could be overconfidence:
     “Students thought they knew more than they actually did, some could be knowledgeable in a particular area, but lagged behind in others, so this program was designed to bring students to a multimodal role, in airfreight, and also in rail, road and maritime,” Mike said.
     “We meet quarterly as an advisory board reporting to FIU Dean William Hardin: our goal is to work with the curriculum to ensure the objective is achieved.”
     The issue of funding was also discussed; in a program of this scope devotion and support are welcome.
     Mike makes clear his deep and abiding appreciation for the support offered from other resources.
     “There are teachers from all areas of the business, with strong support from associations with some leaders functioning as mentors and teachers,” he said
Hearing several well-known personalities in the business had joined, “quite a comprehensive representation” was Marco’s comment.
     In terms of outcomes, Michael White was proud to mention many supporters in American Airlines, PayCargo, and UPS Supply Chain Solutions as well as other forwarding agents’ entities.
     The FIU program consists of an undergraduate, a graduate and a master level.
     “Grow the program and make it more of an international program,” was the objective of the institution and in the State of Florida there is a lot of excitement for this opportunity,” Mike White said.

Share Bettering The Future

     Then there came the question of joining forces with organizations like FIATA, IATA, TIACA or other relevant entities.
     Mike admitted to talks with IATA related to air cargo, for parts that could be added in the curriculum; there were exchanges with NCBFAA, which also produced an indirect advantage: group membership for students in some associations, for students to get involved and get an understanding of the industry as early as possible.

Start At An Earlier Age

     “FIU has mobilized its resources online and in person “to make students understand what logistics is about.”
     To that end support is growing where the rubber meets the road or runway.
American Airlines Cargo and DFW Airport invited students to see the actual operations; forwarders in the local community also made themselves available, so the students could get familiar with the milieu.
     “The initiative is to start before the university level, beginning in local high schools to understand, what is logistics. Start at a much earlier age,” was the quotable consensus of this encounter.
     “No doubt college students prefer to acquire some knowledge of our working environment even before thinking of committing to further studies,” Marco Sorgetti said.

The PayCargo Experience

     Elsewhere noting initiatives taken by the White House regarding the cost and efficiency of logistics, Mike mentioned his conversations with USAID, where real life scenarios were analysed, e.g. the earthquake scenario in Peru. It appeared to be critical that greater efficiencies were found from all parts of the logistics chain, including payments.
     PayCargo has a particular view on how the supply chain intervals can be reduced by making payments more efficient and convenient.
     Most of these initiatives, PayCargo included, tend to create a ‘known user’ environment, a group of users that would work for the outside.
     As such it would work for the customers that are subscribing to a particular scheme, as opposed to what the bank system does where everybody can access their services paying a fee.

The Way PayCargo Works

     “PayCargo has a subscription system as a payer,” Mike said adding, “participants benefit from full visibility and can customize their relationships in their systems. Services can be customized and run by smart phone, one can integrate and accept the process: you buy and then pay the vendor based on agreed terms.
     “It's easy, it creates a medium whereby you can actually have a transaction and manage the payment in a more expeditious manner without wasting too much time to find a stand-in.”

Now Appearing Center Stage

     Obviously, the issue of ownership of data and protection of data emerged at that point. Unsurprisingly this issue had also taken center-stage (again) during the recent FIATA HQ meeting, where it emerged at least in two distinctive moments of the four-day event.
     “Payment data and invoice data are extremely sensitive for all parties, carriers, forwarders and shippers alike,” reports Marco Sorgetti who served as Director General for FIATA (2011-2017).
     “From the conversation we were having, there appeared to be a sort of ‘jealousy of data’ and I can report that at other times there had been even a kind of ‘appetite for data’.
     “Many years ago, when discussing security measures in Brussels some of the maritime carriers’ representatives were expecting legislation to force all parties to submit their data to carriers, Marco said adding:
     “This issue is in fact extremely sensitive from a commercial point of view.
     In reality I must register that it has not been completely resolved even this long into it in 2024.
     “It was still a recurring topic that surfaced again and again in Geneva at the recent FIATA HQ Meeting,” Marco said.
     So, our conversation with Mike, which started with PayCargo helping FIU to make its program really relevant and global, ended on an open note on payment services, possibly identifying an entirely new area of business.
     “We have heard of authorized third party data handlers at different times, in the last decade at least if not earlier,” Marco added.
     “I personally take the view that a genuinely neutral data handler, independent of the influence of carriers, shippers, forwarders would probably have a role to play in modern trade, in particular if the adoption of the MLETR becomes commonplace in the future,” Marco continued, adding:
     “There is on one side an imperative that dictates the rules of safety and security, but we also have to appreciate that international trade can flourish only if a reasonable amount of confidentiality is guaranteed.
     “This is where I see a commercial space that in my view has not yet been fully exploited.”
     Thanks to leading edge top-flight dedicated industry companies mentioned here and people like Eduardo Del Riego, Mike White and Marco Sorgetti, the movement toward tomorrow has advocates who are passionate about doing what it takes in education and business to insure the future.
     And they are looking for input from new members with their thinking caps firmly affixed at graduation time around the world.

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Hong Kong

  International Air Transport Association (IATA)'s big cargo meeting in March set attendance records not seen at that organization since its founding in 1945.
  With all the excitement of the WCS fading into the rearview mirror it seems timely to provide an update from Hong Kong from our friend and colleague Bob Rogers who also happens to be the top shaker and mover at ULD CARE.
  At the top of the pile, came an announcement a few weeks ago that once again Hong Kong International Airport has retained its status as the number one cargo airport worldwide.
  This is no small feat as there are plenty of airports nipping at its heels, but Hong Kong's unique geographical location and its proximity to the manufacturing powerhouse of the Pearl River Delta, now folded into the Greater Bay Area project supercharges Hong Kong's position.
  And over on the passenger side it is almost impossible to reconcile what one experiences today coming through the terminals compared to even just 18 months ago when Hong Kong was still in Covid travel restrictions.
  Cathay Pacific continues rebuilding their operations and expects to reach 100% of pre-Covid levels very early next year, but in the meantime pretty well every destination they covered before 2019 gets at least some service, if not quite the original frequency.
  Moving away from the airport, it's wonderful to feel that Hong Kong energy now is full steam ahead, powered by business travellers and tourists alike, along with cruise ships, conventions and events, and as these visitors come to Hong Kong and experience something that is very different from the picture presented in the western media over the last few years, the message is spreading far and wide.
  An example of such an attraction (pictured here) is a lavish drone show that was put up just a couple of weeks ago to mark the Buddha’s Birthday Holiday.
  Just for fun . . . THE PEKING TO PARIS RALLY ASSOCIATION LIMITED Peking to Paris Classic Car Rally began May 18 in Beijing at (where else?) The Great Wall of China!
Not only a spectacular event, but breathtaking surroundings and on a perfect blue sky morning as they set off.
  How anybody can imagine driving a modern car on the highways from Peking to Paris is beyond me, and these guys were all driving antique cars and often on minor or no roads at all conditions and against the clock!
  Bob Rogers was there as was a friend from Mongolia, Helge of Nomads Tours & Expedition, who has run support for this event in the past when it used to pass through Mongolia. Helge, always a super trooper was back for 2024, running support for this edition Peking to Paris up to the Caspian Sea.
  Bob put a series of photos in a 5-minute Vimeo.

Chuckles For May 28, 2024

Banglasdeshi fabric

     Indian Exporters— especially those in readymade garments – were looking forward to this summer. But, like the rising summer heat, the air cargo market has seen a steady rise. The India-Europe air cargo rates, according to freight forwarders, are “going through the roof”.
     Air cargo rates, for example, from Chennai to Munich around February were Rs 96 ($1= Rs 83) per kg but today it is hovering around Rs 250. It is a good time for the carriers, though. As Xeneta (the leading ocean and air freight rate benchmarking and market analytics platform) mentioned, with stable capacity, the load factor from India to Europe climbed to 87% in the week to March 24. It was the highest since April 2022. “This increasing load factor has also distorted the usual relationship between weight breaks. Traditionally, larger cargo volumes (more weight) are charged at a cheaper per kg price than smaller volumes (less weight). However, in the week ending March 24, the general cargo spot rate for +1,000 kg reached $3.50 per kg, above the spot rate for +500 kg which stood at $3.46 per kg.”
     Adding to freight forwarders and exporters’ woes is the congestion in Delhi airport. Since February 2023, Bangladesh has been sending its RMG consignments to Delhi’s Indira Gandhi International (IGI) airport, according to a trade agreement between the two countries: India and Bangladesh. The agreement permits sealed export cargo from Dhaka to move directly to Delhi airport with minimal border checks. Earlier, export goods from Dhaka were being sent to Kolkata international airport in India.
     FT readers might remember the report about the Delhi International Airport becoming a transshipment centre. The first batch of cargo left Dhaka on February 26, 2023 reached the Delhi Airport on March 3 and left for Spain on March 5. It may be mentioned that the airport had created a special truck docking facility and a dedicated X-ray area for the fast transfer of cargo to outbound locations.
     At the launch of the transshipment facility, Videh Kumar Jaipuriar, CEO, Delhi International Airport Limited had said, “The Delhi airport is on its way to become the global cargo hub of the world, serving as a transshipment center between the East and the West. Globally, most manufacturing takes place in South and Southeast Asian nations, which lack freight and handling capacity. This is where Delhi airport can help countries come together, help businesses and economies of neighboring nations to prosper.”
     Sanjiv EdwardThe CEO’s colleague, Sanjiv Edward, (right) CEO for cargo at GMR Airports (operator of Delhi International Airport), was quoted saying that Bangladesh exports since February 2023, totalling more than 8,000 tonnes from Delhi, was "a significant milestone". He also said that Delhi Airport was “playing a pivotal role in enhancing bilateral ties between India and Bangladesh, particularly in facilitating the seamless export of Bangladeshi cargo to global markets, cementing the airport's status as the foremost cargo hub in Southeast Asia."
     The volume of export goods from Bangladesh has risen with the Red Sea crisis.
     These consignments from Bangladesh have been hogging space in international carriers going to Europe and the U.S. Result: there is little room for Indian exporters. As an Indian exporter, who did not wish to be named, pointed out, “We have to pay a premium to get some space on aircraft. Otherwise, it is almost impossible to get space.”
     The figures from Delhi airport point to the volumes from Bangladesh. From April to December 2023, Delhi airport handled 260,000 tonnes of export cargo, with Bangladesh accounting for just 5,000 tonnes or less than two percent. In the March 2024 quarter, of the 90,000 tonnes handled, Bangladesh’s share was 8,000 tonnes or 9 percent.
Shovon Islam     For Bangladesh’s exporters, sending out consignments from Delhi is more cost-effective than Dhaka Airport. Shovon Islam, (left) managing director of Bangladesh’s Sparrow Group, was quoted saying: “The airfreight cost from Dhaka to New Jersey stands at $6 per kilogram, while it is only $4 from Delhi airport. Similarly, the airfreight cost from Dhaka to New York is $8 per kilogram, whereas it is only $5 from Delhi airport. Additionally, the airfreight cost from Dhaka to Madrid or London is $5.5 per kilogram, compared to only $4 from Delhi airport."
     Delhi, according to Bangladesh exporters, offers competitive prices due to the high number of direct flights and chartered cargo services across various routes.
     In a recent move, the Federation of Indian Export Organisations (FIEO, the apex trade promotion organization in India) has demanded that the government implement corrective measures to boost Indian air cargo exports. One of the measures FIEO has suggested to the Indian government, is to impose
a “landing charge” on Bangladeshi cargo. Speaking on the same line, India’s Apparel Export Promotion Council (AEPC), also wanted the government to stop transshipment of Bangladesh’s export cargo through Delhi airport.
     According to Indian exporters, Bangladesh exporters could pay high rates since they could fall back on the Generalized System of Preferences (GSP)—GSP removes import duties on products sent from developing countries—in Europe and Western markets.
     It is important to note that apparel exports from India have seen a downturn. The export of readymade garments fell to $13.05 billion between April 2023 and February 2024, compared to $14.73 billion during the same period last year. During the same period, the value of yarn shipments declined to $4.23 billion from $4.47 billion.
Sudhir Sekhri     According to Sudhir Sekhri, (left) Chairman, AEPC, “the continuing Red Sea crisis has already increased logistical costs for the exporters and it has also led to a shift of export shipments from sea to air mode. At this crucial time, allowing Bangladeshi export cargo from J. KrishnanDelhi Air Cargo Terminal will further increase the logistical challenges and increase the transportation cost for apparel exporters. Around 30 trucks from Dhaka come to Delhi every day. This extra load has caused slowdowns in cargo clearance in addition to the high rates and space crunch faced by exporters. The severe congestion at the Cargo Terminal at the IGI Airport, Delhi has resulted in exports of Indian apparel through Delhi air cargo complex becoming uncompetitive,” Sekhri said.
     Air cargo veteran and Air Cargo Agents Association of India (ACAAI) Advisor from Chennai, J Krishnan, (above right) pointed out that the lack of space in Delhi has been affecting other Indian airports. He termed the crisis confronting Indian air exports, as “a double jeopardy”: lack of space and freight rate increases.
Tirthankar Ghosh

FlyingTalkers podcastFlyingTalkers

PayCargo Educational

India Map

  The Indian government’s ambitious drive to boost air cargo to 10 million metric tonnes by 2030 looks good on paper. But will it be possible to achieve that goal without widebody freighters? That is the question that is being asked by air cargo stakeholders.
  A quick look at prevailing figures points out that exports from India have seen strong growth: there was a 21 percent growth year-on-year, according to figures for the first eleven months of fiscal year 2023-24 (April to February). Domestic cargo—belly cargo in passenger aircraft as well as freighters—grew to 6,98,000 metric tonnes at the same time. Domestic cargo constitutes 40 percent while exports make up 60 percent of the total throughput. Of this, the largest chunk of export shipments was transported by foreign air operators. That is around 94-95 percent of the export cargo. The remaining 5-6 percent is being handled by widebodies of Air India and Vistara. By 2027, low-cost Indian carrier IndiGo would start widebody services: it has recently signed a firm deal for 30 A350-900 jets, with purchase rights for an additional 70 “for possible future needs under certain conditions”.
  Both Boeing and Airbus have forecast India's growth in air cargo, largely due to manufacturing and e-commerce. Boeing, for example, has said that India would need more than 80 freighters in the next 20 years. Airbus, with its eye at the future, has tied up with Hindustan Aeronautics Limited (HAL, Indian public sector aerospace and defence company, headquartered in Bangalore) to support aircraft maintenance, repair, and overhaul (MRO) services for the country's burgeoning commercial fleet.
  In the prevailing condition, it will be a difficult task to reach the 10 million metric tonnes mark by 2030 and transporting the 10-mn tonne air cargo as belly cargo cannot even be imagined.
  What India lacks are widebody freighters that can fly long distances. Experts have pointed out that this is opportune moment for potential air cargo operators to start freighter aircraft and P2F (passenger-to-freight) operations.
  Placed against freight carriers like FedEx, DHL or UPS, India has only a handful of freighters: 14 to be exact and all of them are narrowbodies that cannot reach destinations in Europe or the United States.
  The major obstacle for potential domestic freighter operators is the lack of a level playing field. The huge custom dues that have to be paid for leased aircraft registered in India put operators off. Additionally, civil aviation regulations prevent India’s cargo airlines from operating planes that are more than 20 years old even as foreign carriers fly into India with much older planes.
  The government is well aware of the demand from air cargo stakeholders for the creation of dedicated cargo airports. The government is also keen to bring a transshipment policy to make India an international hub for air cargo transport. This would go a long way to achieve the ambitious target by 2030.
  However, a word of caution. This is election year and by June 4, India will know who will take over the governance of this huge country. If there is a change in the government, air cargo stakeholders might have to wait longer for any sort of development to take place.
Tirthankar Ghosh

Memorial Day May 1940

     The barbeque was served family style on plates by the side of the road.
     Beef ribs were almost too big to believe, and bread this size was a wonder.
     Later we fished in a stream that was so clear that you could see right down to the bottom as the fish winked and laughed at us.
     But the conflict that was about to come that made the end of May our portal to the summer season in America, would also take away this world we knew and treasured, forever.
     Now, 84 years later, the images reappear like a smoke dream that is gone with the wind.
     The words from Walt Whitman are eternal:
               The moon gives you light,
               And the bugles and the drums give you music,
               And my heart, O my soldiers, my veterans,
               My heart gives you love.

     Aside from being the Summer ’24 opening day for swimming pools, parks, and beaches across America, Memorial Day May 27, 2024 in the United States was meant to honor members of the armed forces of today and yesterday.
     We extend our salute to all who serve(d) our country while we continue to pray for peace on our planet.

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Vol. 23 No. 22
ICAO Cargo Workshop
Chuckles for May 6, 2024
LAACA Proud Bird Moves Its Tail
Remembering Bruce McCaffrey
Vol. 23 No. 23
ICAO Cargo Action Peru
Bob Arens Is Fondly Remembered

Vol. 23 No. 24
AmidSpring's Day Dream
Chuckles for May 14, 2024
Where Are They Now

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