Vol. 8 No. 66                                         WE COVER THE WORLD                                                            Monday June 22, 2009

AeroLogic Uplifting Experience

     There was a party inside a giant DHL hangar in Leipzig, Germany, a place that looks as much about tomorrow as can be imagined.
     The structure redefines the word gigantic.
     DHL even has a rail line hooked up that reaches the airport from just about everywhere and will someday do more than move kerosene from the nearby fuel farm to the fleet.
     Still, as new as this place is, this past Friday harkened back to another time.
     Since last year, air cargo has been all about financial crises and business climate meltdown.
     That reality continues despite moderation and stock market rallies.
     So spending some time in a location created for bigger things, including two A380s, worked out nicely for us.
     The hangar featured a new B777 freighter, the first aircraft of the new airline AeroLogic.
     The event was good news for a change – an airplane reveal with a gaggle of press in tow helping to celebrate such a top agenda item.
     When was the last time that happened?
     Lufthansa, Deutsche Post and DHL, all partners in the AeroLogic joint venture, still believe that they are going to win.
     Air cargo needs that kind of determination, talent and, if you will, attitude right about now, especially as business moves headlong into a new age.


    August Wilhelm Henningsen, Chairman of Lufthansa Technik, looked up at the B777F noting that Technik had been caring for various derivatives of the aircraft for some years.
   “This aircraft will not be a challenge for us, in fact, several of our team are working with AeroLogic,” he said.
   “It is really quite beautiful,” Herr Henningsen added.

     Like it or not, the new reality as pointed out this week by Justin Fox in Time Magazine is of bear markets, volatility, high energy prices, higher taxes and even frugality.
     There will be plenty of facts, opinions and assorted comments elsewhere from the Leipzig AeroLogic press conference.
     Here in today’s FlyingTypers is our report and a recorded highlight spin of the event as it unfolded.
     There is an additional point to be made.
     We think that how people feel about themselves can often be the deciding factor between success and failure.
     Musician Duke Ellington once said:
     “If it sounds good, it is good.”
     The cargo airplane of the future is now primed and ready to go with plenty of well-wishers to give it a proper start up.
     It’s the way things used to be done everywhere.
     The AeroLogic B777 freighter is actually the third B777F to enter all-cargo service at an airline.
     The first B777F went to Air France and the second went to work for Emirates.
     We’re not sure how EK celebrated, but AF barely put out a press release and a picture.
     That’s no way to treat a lady, we thought, as that AF B777 rolled in like a thief in the night at CDG a while back.
     At LEJ, drum rolls, fanfare music and CEOs in expensive suits sent this hundred plus million dollar cargo lifter skyward, and everybody got a lift.
     It felt good.
     Friday in Leipzig was good.
Geoffrey/Flossie Arend
August Wilhelm Henningsen, Chairman of Lufthansa Technik, looked up at the B777 noting that Technik had been caring for various derivatives of the aircraft for some years.
“This aircraft will not be a challenge for us, in fact, several of our team are working with AeroLogic,” he said.
“It is really quite beautiful,” Herr Henningsen added.

 

     The speaker’s panel in DHL's huge hangar at Leipzig/Halle Airport was jammed with highly important CEOs and Managing Directors with plenty of smart things to say.
     But the real star, Boeing’s newest long range air cargo lifter, the B777F stood silently just behind the stage.
     During these uncertain times when the 800-pound gorilla at every business meeting is the economy, that shiny new airplane and this bold step toward the future were reassuring.
     “This aircraft is an enabler giving AeroLogic a competitive advantage in the global market,” lauded CEO Frank Appel (left) of Deutsche Post, parent company of DHL.
     The prediction was supported by Lufthansa Cargo’s CEO Carsten Spohr who, himself a pilot, highlighted the economy of the triple seven freighter that can zip 9,038 km nonstop (4,880 nm) with a full payload of 103 tons.
     B777F, we learned, also provides a 20 percent fuel-burn savings while contributing to substantial emission reduction and can lift 37 pallets per flight giving the craft an additional payload of 15 percent as compared to Lufthansa Cargo’s flagship MD-11F.
     “It’s the best equipment in this category of twin-engined aircraft,” Lufthansa CEO Wolfgang Mayrhuber (right) noted.
     Something else Herr Mayrhuber said about the big picture to some business students in China recently came to mind.
     “Values are what counts.
     “The pioneering spirit of managers and staff is one of the keys to a company’s success.”
     This first AeroLogic B777 freighter will depart Leipzig/Halle on her maiden schedules June 29, en route to Bahrain, Hong Kong and back to Germany.
     In July a second B777F is expected and a third and forth coming in December.
     Next year another four of Boeing’s longest-range freighters will be added to AeroLogic’s fleet bringing the total number of aircraft to eight.
     “By then the company will be ranked fourth place among Europe’s cargo airlines,” said Herr Spohr.
     All aircraft are leased from a subsidiary of German DVB Bank.
     Originally AeroLogic envisaged as many as eleven B777Fs but scaled the fleet back to eight units due to the weak market situation.
     However, at the Leipzig event last Friday managers did not exclude adding additional equipment as the global economy rebounds and prospects brighten.
     Wait and see while things recover, one gets the feeling, is prudent but also an absolute fact of life at least in the near term ahead.
     But here, as numbers tumbled all around and Boeing Company sat all week at Le Bourget in Paris without an order, was a new airplane and cargo airline and a hangar full of people out to celebrate that fact of life for both.
     In total, Deutsche Post and Lufthansa expect expenditures between €15 to 17 million euros until the new carrier is in full swing.
     “But we calculate to spend less money due to an intelligent cost managing program,” said Lufthansa’s Herr Spohr.
     The new carrier commences commercial activities in a highly unfavorable environment with international markets down everywhere.
     Taking to the air at these times is quite a challenge, admitted both Managing Directors Thomas Pusch (right) and Thomas Papke (left) of AeroLogic GmbH, but “we believe it to be opportune to invest in new capacity also in gloomy periods for improving our competitiveness,” argued Frank Appel of Deutsche Post.
     Appel further emphasized the geographic closeness of the nearby East European markets that are expected to grow substantially in mid- and long-term perspective, making Leipzig/Halle in South-East Germany a good choice for establishing a cargo airline.
     Thomas Pusch confirmed that the original business set up about a year ago is still fully valid despite the three months delayed delivery of the first aircraft by U.S. manufacturer Boeing that kept AeroLogic grounded until now. “We intend to turn a profit sometime next year,” said Pusch when asked by ACNFT.
     DHL Express and LH Cargo will share the capacity of the fleet.
     The integrator will utilize the plane Monday to Friday while Lufthansa Cargo will take over on weekends deploying the freighter within its own network.
     Both AeroLogic owners (50/50%) however, can load their own shipments each time if needed, whether the craft is flying on DHL routes or within Lufthansa Cargo’s network.
     This dual use guarantees a basic revenue payload which minimizes the financial risks for both DHL Express and Lufthansa Cargo.
     The launch of AeroLogic was widely lauded by politicians at the Leipzig event.
     “Our entire region is developing more and more into an automotive and logistics cluster creating thousands of new jobs,” said Leipzig’s Mayor Uwe Albrecht (right).
     He added that this was triggered by DHL when the integrator decided to abandon Brussels because of tight night flight restrictions and move to the city in Saxony where cargo operations are possible 24/7.
     “We wish other airports that we heavily utilize would also refrain from imposing curfews,” exclaimed Carsten Spohr indirectly addressing Lufthansa Cargo’s home-base Frankfurt Rhein/Main.
     About those night flights at FRA—a court will decide soon if restrictions will be imposed or exceptions allowed enabling LH Cargo and other carriers to continue operations between midnight and dawn.
(Heiner Siegmund/Geoffrey Arend)

     Air Cargo News FlyingTypers leads the way again as the world’s first air cargo publication to connect the industry to the broadly expanding and interactive base for social commentary—Twitter.
     Here are updates from Twitter so far this week. To be added to this 24/7/365 service at no-charge contact: acntwitter@aircargonews.com

June 21: China moving to less airlines that compete globally. China Eastern Airlines and Shanghai Airlines to merge. Analysts say carrier will still need state aid.

June 20: As DHL helped launch AeroLogic June 19 former DHL hub at BRU saw cargo drop 41.3 in May with all-cargo flights down by 50% .

June 20:
David Bronczek top executive of FedEx Express, is new Chairman of IATA's Board of Governors starting next year.

June 20:
AF/KL fined $350 million by USA in 2008 for air cargo price fixing admitted it did the same thing in Canada 2002-2006 now faces further fines.

June 20:
Emirates covering world from Dubai loves B777s-with 74 and 32 on order. Last week, EK took delivery of its second B777F Friday (the first) from leasing firm DAE Capital. Here HH Ahmed bin Saeed al-Maktoum, Emirates CEO and DAE group managing director HE Dr. Omar Bin Sulaiman celebrate the arrival.

June 20:
Air India execs at manager and above told to not take salary or bonus for July. Meantime 24,000 employees will strike if not paid June 30.

June 20:
Aerologic B777F debut Friday in Leipzig by partners Lufthansa and DHL is first low emission, low consumption cargo aircraft in Germany.

June 19:
DHL Life Science and Healthcare Competence Center to debut at Shanghai PVG will include a “core team of industry experts,” DHL said.

June 19: Boeing came up empty at Paris Air Show this week but U.S. lawmakers authorized more than $2 billion for eight new Boeing C-17 cargo planes.

June 19:
Qatar Airways Cargo is 28th member of IATA Cargo 2000. “System is solution for implementation and measurement,” QR CEO Akbar Al Baker said.

June 18:
No Cash Cow- Taipei CAA said cross-strait flights are not to be profit engines for airlines. EVA said it will take closer look at fares.

June 18: Philippe de Crécy named Chairman of Management Board at DB Schenker Logistics in France, succeeds Joël Moebel, who left the company.

June 18:
Airbus won at Paris Air Show adding 31 firm orders 24 A320 to Qatar Airways and 10 A350s to AirAsia X. Cebu Pacific ordered five A320s.

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From My House To Bauhaus

     I had an opportunity last week to visit Dessau, Germany, home of Bauhaus.
     Bauhaus is an extraordinary center of design, art and architecture that changed the modern world as we see it in so many big and small ways.
     If Bauhaus were to be remembered for a single thing, it would probably be its distinctive window wall, glass box building, erected in Dessau in 1925 by Walter Gropius. That building marked a turning point in the way buildings in every city in the world are constructed.
     If you want to see some elements of the architectural movement that began at Dessau Bauhaus, just look out your window.
     Bauhaus has been a major focus of my adult life in terms of preservation, beginning first in a campaign to save Building One, the old Administration Building at Newark Airport, and later in the Marine Air Terminal at LaGuardia Airport.
     Riding that train from Leipzig to Dessau Haupt Bahnhof was a sentimental journey to a place I’ve known all my life.
     After about an hour of touring the grounds and master homes, I was hoping that I was a decent enough human being to be allowed to return to this place again.



Geoffrey at Bauhaus, and the building that changed everything, located on the corner of Gropiusallee & Bauhausstrasse.


     They feature lessons, films, a wonderful café with food served on milk white Bauhaus plates (what else?) and a gift shop with about a million books all written about Bauhaus and published in various languages.
     Bauhaus can be reached from the train station in five minutes. It’s well worth the trip to see the design source for so many things we experience at every turn of modern life: the font in your newspaper, the fork in your hand and the light in your living room.
     This place was built in 1925 after Bauhaus was kicked out of Weimar, and Hugo Junkers is said to have hung out at the dedication late into the night.
     After that, Marcel Breuer, a Bauhaus master who designed the famous steel chairs, created wicker seating for the early Junkers aircraft, including the JU-523Ms.
     Bauhaus graphic artists also designed the Junkers logo and Bauhaus architects created housing for the workers at the nearby Junkers aircraft manufacturing plant and airport in Dessau.
     By 1938, both Marcel Breuer and Bauhaus founder and guiding spirit Walter Gropius had taken up Professorships at Harvard in Boston, leaving Germany forever.
     Both went on to design and build distinctive homes in Lincoln, Massachusetts that are eminently Bauhaus. Both are rare, completely preserved landmarks that anyone can visit year round.
     But if Dessau and Lincoln are not on your visiting trail anytime soon, just look up at the Pan Am Building in New York City, now called Met Life.
     Walter Gropius had a hand in designing that place as well.
Geoffrey