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FedEx top of the pile in 2014

EXPANSION PLAN WORKING FOR ABC

AMERICANLOOKING TO BUILD

COOL CHAINEXPANSION FOR AF-KL-MP

MERSTARINVESTS IN THE FUTURE

The weekly newspaper for air cargo professionals

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FEDEX carried the most freight in 2014 followed by UPS and Emirates Airline, according to the 59th International Air Transport Association (IATA) World Air Transport Statistics (WATS) yearbook.

IATA says WATS found last year, air-lines operated around 100,000 flights per day and transported 51.3 million tonnes of cargo, equivalent to around 35 per cent of the total value of all goods traded internationally.

The top 10 carriers ranked by freight tonnes carried on scheduled services were FedEx (7.1 million), UPS (4.2 mil-lion), Emirates (2.3 million), Korean Air (1.5 million), Cathay Pacific Airways (1.5 million), China Southern Airlines (1.3 million), China Airlines (1.3 mil-lion), All Nippon Airways (1.2 million), Air China (1.2 million) and Qatar Air-ways (1.2 million).

WATS found globally, cargo markets showed a 5.8 per cent expansion in freight tonne kilometers (FTKs). This out-stripped a capacity rise of five per cent and lifting load factors to 48 per cent. FedEx was the busiest airline by FTKs in 2014 with just over 16 billion, ahead of Emirates in second with 11.2 billion.

Air France KLM Martinair (AF-KL-MP) Cargo has signed a partnership with China Southern Cargo to give customers access to each other’s network from 1 November.

The partnership was signed in Guangzhou (China) on 15 September by AF-KL-MP Cargo executive vice president, Bram Graber, and China Southern Cargo senior vice president, Zhao Fengsheng. The carriers say in the first stage of the partnership, they will use each others handling facilities at hubs. They will improve cooperation for express and mail to accommodate for the growing popularity of e-commerce between Europe and Asia.

Graber tells Air Cargo Week (ACW): “This partnership will give many more opportunities for our customers to develop and forward their

cargo sales to many more destinations and also new destinations compared to those they pres-ently have on each carrier.”

The carriers say the partnership will provide AF-KL-MP Cargo customers access to China Southern’s network in Asia Pacific while China Southern users will find it easier to ship to Europe, Africa and Trans-Atlantic routes.

Graber tells ACW AF-KL-MP has been work-ing with China Southern for some time through the SkyTeam Cargo alliance. He says: “There was a natural and obvious logic to develop things together for the benefit of our customers by offering them new opportunities.”

Graber says if this partnership is a success then it could result in further collaboration. He tells ACW: “We are confident that this new offer

will be successful among our customers; so yes there should be good reasons to think that is should open doors to increased partnership with China Southern in the future.”

In August this year, China Southern joined IAG Cargo’s Partner Plus Programme, giving IAG customers access to China Southern’s network.

Investment in pharma facilities paying off

Air cargo is clawing back lost pharmaceu-tical business to sea freight as investment in specialist services to

handle the changing and complex needs of pharma shippers begins to pay dividends.

Airfreight is going through chal-lenging times due to the instability of the world economy and slow-down in Asia, but one of the bright performing markets in the indus-try is pharma.

The shift back to air cargo was detailed by the International Air Transport Association’s (IATA) cargo manager for Western Europe, Francisco Rizzuto, in Milan (Italy) on Tuesday, 15 September at the Alha group’s unveiling of its new PharmaZone (pictured below)

at Milan Malpensa Airport (pic-tured right).

Rizzuto explains IATA forecasts growth in pharma moved by air will be 12 per cent until 2018, up from the six per cent growth achieved from 2008 to 2013.

The industry’s share of global pharma products transported has plunged since the turn of the cen-tury. In the year 2000, air cargo had a 17 per cent share of the mar-ket as the pharma industry relied heavily on the industry for its speed and efficiency, but by 2013 it had declined to 11 per cent.

“There was an increasing shift to move pharma by sea due to the challenges of air cargo. The pharma market lost trust and con-fidence in air cargo. The pharma guys said they were losing a lot of money,” Rizzuto says.

Pharma shippers moved to sea freight as they were unhappy with the costs from lost, scrapped and returned products and the lack of compliancy and standardisation across the air cargo supply chain.

Rizzuto explains much of the

complaints from pharma manu-facturers in his experience were about the cargo handling part of the supply chain.

But things are changing and air-lines, cargo handlers and freight forwarders are all ploughing investment into specialist pharma products and services to meet shippers’ needs, backed by IATA’s Centre of Excellence for Indepen-dent Validators (CEIV) Pharma certification.

Alha is the latest to invest and unveiled its PharmaZone at Milan Malpensa on Tuesday. The cargo handler was awarded the CEIV cer-tificate for the facility, making it the

15 globally to be CEIV certified.Alha general manager, Alessan-

dro Cappella, says: “Alha wants to give an effective response to the needs expressed by the various stakeholders in the air cargo mar-ket: shippers, forwarding agents, airlines, with the specific intent to offer a more and more relevant service to the needs of airport users (in line with the European and international community standards) for a continuous devel-opment of airfreight traffic.

“It is now a concrete fact that air cargo pays particular attention to this type of product (pharma), where more and more frequently, and with greater volumes, air-craft bellies are used for pharma transportation.”

Alha’s PharmaZone covers 600 square metres and can handle products from two to eight degrees Celsius and 15 to 25 degree Cel-sius. It is part of the 4,000 square metre Alha Cool Centre at Milan Malpensa. The firm’s pharma man-ager, Nicola Caristo, says it will be a “pharma hub for Southern Europe”.

China Southern links up with Air France KLM Martinair

Volume: 18 Issue: 37 21 September 2015

NEWSWEEK

T the financial performance of air-lines fell by five per cent in August compared to July, according to the International Air Transport

Association (IATA), but the industry is doing significantly better compared to the same time in 2014.

The association announced the news in its August report of its Airlines Financial Monitor, where it sampled the balance sheets of 58 airlines across the industry.

The combined net post-tax profit of the carriers’ after the second quarter of this year was $8.7 billion, nearly double the $4.4 billion after the second quarter last year.

IATA says that the performance of car-riers’ has been improving strongly up to the middle of the year. “The increase was driven by North American airlines, where consolidation and lower fuel costs have resulted in a significant boost to

profitability.“Airlines in Asia Pacific were also up

on a year ago supported by cost-cutting measures and easing fuel cost pressure. Airlines in Latin America, by contrast, struggled with falling yields and recession in the major economy Brazil,” IATA notes.

The association also explains that performance on the stock markets has

declined, and share prices fell five per cent in August compared to July.

These prices were dragged down by the fall in the broader market, which IATA says was down by six per cent over the month.

“Globally, markets were impacted by developments in the Chinese economy. China’s stock market experiencing its larg-est one-day fall in August since 2007 has increased concerns about further slow-down in the economy. Airlines in Asia Pacific were most impacted, with a fall of 15 per cent in August compared to July. In the previous month, airline share prices rallied in response to a fall in fuel prices,” IATA explains.

Finances were also affected by crude oil prices, which fell in August, pushed down by expectations of supply rises from Iran and the US and a softer demand outlook. Oil prices are down by 58 per cent on the 2014 highs.

2

Airline finances on the up despite fall in August

VOLGA-DNEPR AIRLINES has transported an 11 tonne oil and gas pump from the Netherlands to Turkmenistan using an Ily-ushin IL-76TD-90VD Freighter.

The airline transported the pump from Maastricht Aachen Airport in the Netherlands to Mary International Airport Turkmenistan on behalf of Agility Projects Rotterdam. After arriving in Mary it was transported by road to its customer based in Farab, Turkmenistan. For protection, the pump was transported inside a two tonne wooden crate for the whole journey.

Volga-Dnepr senior engineer for dangerous cargo, Azat Yak-upov, says the airline used a trailer and special cradles to load onto the aircraft’s rail system. He adds: “We didn’t have any difficulties loading the pump because we have been carrying oil and gas cargoes for customers for 25 years and accumu-lated huge experience of delivering similar shipments.”

Volga-Dnepr services Turkmenistan

More TNT flights to northern EuropeTNT has increased services to Sweden and Finland by re-in-troducing flights to Stockholm Arlanda Airport and Orebro Airport, while services to Turku Airport will stop at Helsinki Vantaa Airport first.

The courier delivery firm restarted the five times a week Liege (Belgium) to Stockholm and Orebro services on 7 Sep-tember, which TNT says will provide earlier arrival times for imports and later export departures compared to the previous service to Vasteras Airport.

TNT says now the Liege – Turku service stops in Helsinki, the company will reach the Finnish capital three hours earlier than before.

TNT International Europe managing director, Ian Clough says: “We have expanded the number of locations for our in-ternational, next-day morning deliveries in the Nordics to help our customers who need speed and certainty.”

TNT says in Sweden it has appointed new distribution part-ners in Sweden to speed up deliveries in Stockholm, Malmo and Orebro. In Finland it has adjusted what it calls its pick up and delivery capabilities (PUD) in Helsinki to accommodate for the change in flight times. TNT says it has increased its PUD services in Denmark to allow more deliveries for 12.00h in the Copenhagen and Billund areas and has done the same in Norway for Oslo and Stavanger.Last month, FedEx bid 4.4 billion euros ($4.8 billion) for TNT. The deal is set to be finalised in the first half of 2016.

ACW 21 SEPTEMBER 2015

NEWSWEEK

3ACW 21 SEPTEMBER 2015

D HL Express is to invest up to $70 mil-lion expanding its European hub at Leipzig Halle Airport so it can handle up to 150,000 shipments per hour by

the fourth quarter of 2015.DHL will be doubling warehouse space to

80,000 square metres and will reduce the pro-cessing time of non-conveyable shipments up to 170 kilos to 10 minutes.

The company says when the expansion is completed in the fourth quarter of this year, processing packages will take less than two hours and it will have an aircraft taking off or landing once every three minutes. At the moment, it can process up to 60,000 parcels an hour and 43,000 flyers during the same time.

Describing the German market as a whole, DHL Express executive vice president for net-work operations and aviation, Roy Hughes, tells Air Cargo Week (ACW) in Leipzig on 11 Septem-ber: “In 2015 we are seeing the same level of

growth as other mature economies, growing faster than the natural measure of GDP [gross domestic product].”

For the rest of the year, Hughes tells ACW: “We expect more of the same, there is no reason we should see a slowdown. We have a signifi-cant investment at Leipzig and we expect to see growth seasonally at the end of 2015.”

Describing the investment, he continues: “Leipzig helps enable us to manage volumes more efficiently. It will give us a better platform over the next five to 10 years for growth.”

DHL has invested a total of 507 million euros ($574.3 million) at the Leipzig hub, the site is

on an area of 225,647 square metres and han-dles more than 60 flights a day.

The integrator is also spending 1.3 billion euros on 40 infrastructure projects across its network, including European hubs.

As well as expanding Leipzig, it has been investing other European hubs. In the UK it is spending £90 million ($138 million) at East Midlands Airport with an additional £32 mil-lion at Heathrow Airport.

DHL is also spending 114 million euros on a new hub at Brussels Airport, which will more than triple capacity from 12,000 packages an hour to 39,000.

Growth set to continue for DHL as it revamps Leipzig hub

AIRBRIDGECARGO AIRLINES (ABC) tonnage saw a surge of 17 per cent year-on-year (YOY) for the first eight months of the year.

In the period to the end of August, ABC transported 300,000 tonnes of cargo. The carrier says its expansion strategy of entering new markets enabled it to achieve a stable load factor of 67 per cent and an increase in freight tonne kilometres (FTK) of 22 per cent. Traffic in August alone rose by 14 per cent over August 2014 to more than 39,000 tonnes, with FTK’s climbing 15 per cent.

ABC executive president, Denis Ilin, says: “We are ex-erting our best efforts to maintain the level of growth we achieved in 2014 and to improve this by providing our customers with reliable and efficient trans-portation services.”

“We been developing our route network and fleet but also invest-ing heavily in service technology and attracting the best industry experts to support ABC’s clients worldwide,” Ilin adds.

Expansion plan working for ABC

WorldNewsVIRGIN ATLANTIC CARGO is to start using lightweight air cargo nets with DSM Dyneema as part of its ongoing effort to reduce aircraft CO2 emissions by 30 per cent by 2020.The airline has ordered 600 of the nets, which at nine kilos each represent a four kilos saving on the weight of a traditional cargo net used to secure shipments on pallets.

UNITED AIRLINES has appointed Oscar Munoz as chief executive officer (CEO).He takes over from Jeff Smisek, who has stepped down as chairman, pres-ident and CEO, and director, with immediate effect. Munoz will also con-tinue to serve on the board of directors at United Continental Holding, as he has done since 2010. He joins United from CSX Corporation.

August decline at FrankfurtFRANKFURT AIRPORT’S cargo volumes fell by 4.2 per cent in August to 172,055 tonnes due to a slowdown in world trade, particularly in the Far East.

Throughout 2015, Frankfurt Airport has only seen year-on-year (YOY) cargo volume increases in February, when it rose by 1.8 per cent to 162,068 tonnes, and in April, when it was up by 0.8 per cent to 173,274 tonnes. Cargo volumes have fallen by 2.2 per cent year-to-date to 1.4 million tonnes.

Frankfurt Airport’s operator, Fraport says other airports it operates have had varied results in August. Ljubljana Joze Pucnik International Airport in Slovenia has seen cargo in-crease by 13.3 per cent YOY to 811 tonnes. Jorge Chavez International Airport in Peru’s capital, Lima, saw an in-crease of 2.3 per cent to 27,302 tonnes.

Of Fraport’s Bulgarian airports, Burgas Airport has seen an increase of 100 per cent 648 tonnes but Varna Airport saw volumes fall by 38.2 per cent to nine tonnes. Han-nover-Langenhagen Airport saw an increase of 30.6 per cent to 1,170 tonnes and China’s Xi’an Xianyang Interna-tional Airport was up by 25 per cent to 19,090 tonnes.

NEWSWEEK

4 ACW 21 SEPTEMBER 2015

Consumer goods rise boosts Incheon

INCHEON INTERNATIONAL AIRPORT has seen cargo volumes increase by 1.8 per cent to 1.7 million tonnes in 2015 up to August because of a growth in imports of consumer goods.

Imports have increased by 2.9 per cent to 832,379 tonnes, while exports were up by 0.8 per cent to 870,998 tonnes. The airport’s operator Incheon International Air-port Corporation tells Air Cargo Week (ACW) the imports mainly come from the Americas, South East Asia and Japan, and have been increasing.

Incheon International Airport Corporation, director of cargo, Ok-Soon Han, tells ACW it expects international cargo volumes to grow by 2.5 per cent for 2015 as a whole, after years when they were “more or less stag-nant” due to the Korean economy slowing. She says: “September to November is peak period for the air cargo industry, we expect

the import of consumer goods from [the] Americas and China to Korea will increase.”

Han says that Vietnam has become one of South Korea’s top five trade destinations, joining China, the US, Japan and Hong Kong, overtaking Singapore. She tells ACW: “This trend is expected to continue with the sign-ing of the Korea – Vietnam FTA [free trade agreement] on 5 May 2015.”

Han says express cargo and perishables are areas with potential to grow, having in-creased by on average 14 per cent and 25 per cent annually over the past three years. She tells ACW: “Although volume in absolute terms is relatively small, rapid increase in such goods is a new source of growth.”

Han says the main exports from Korea are plastic products, wireless communications devices, automobile parts, semi conductors and knitted goods. Imports are grain, ma-chine parts, clothing and plastic products.

Hong Kong International Airport (HKIA) has seen another year-on-year (YOY) fall in August, with volumes falling by 1.2 per cent to 361,000 tonnes, because of a five per cent drop in transhipments.

After a strong start to 2015 with YOY growth in January and February, volumes have fallen in every month since them compared to last year. January saw YOY growth of 1.6 per cent to 356,000 tonnes, which was followed by a YOY increase of 22.6 per cent in February to 303,000 tonnes. March saw an 8.2 per cent decline to 364,000 tonnes, which was blamed on a 16 per cent decline in exports. April saw a smaller fall of 0.7 per cent to 360,000 tonnes.

May saw a small dip of 0.3 per cent to 366,000 tonnes followed by a YOY drop of 3.5 per cent

to 349,000 tonnes in June. July saw cargo fall by 1.9 per cent YOY to 363,000 tonnes before the 1.2 per cent drop in August. Cargo volumes have increased by 0.1 per cent to 2.8 million tonnes year-to-date.

Airport Authority Hong Kong general man-ager for market and connectivity development, Henry Ma, says the airport has increased ser-vices to Europe in September. Ma says: “We welcomed Scandinavian Airlines, which began operations at HKIA on 11 September, offering five times a week to Stockholm. Cathay Pacific Airways started a four times a week service to Düsseldorf on 1 September.”

Hong Kong based carrier, Cathay Pacific and its subsidiary, Dragonair, saw cargo volumes increase by 0.8 per cent to 148,109 tonnes in August. So far this year, cargo volumes have increased by six per cent to 1.1 million tonnes. In August the load factor fell by 1.9 percentage points to 60.6 per cent.

Cathay Pacific general manager for cargo sales and marketing, Mark Sutch, says August is a traditionally weak month and 2015 was no exception. He says: “We operated more capac-ity than in August 2014 but the tonnage carried improved only marginally while the load fac-tor fell, highlighting overall the weakness in demand.”

Tonnage fall in August at Hong Kong

Volumes drop at Heathrow

HEATHROW AIRPORT has seen its fourth consecutive monthly year-on-year (YOY) fall in August, with cargo volumes dropping by 0.2 per cent to 122,540 tonnes.

The airport saw cargo volumes fall in May, June July and August this year having expe-rienced YOY growth of at least two per cent in every month between January and April.

Between January and August 2015,

cargo volumes have increased by 0.8 per cent to 985,627 tonnes. Over the past 12 months, between September 2014 and Au-gust 2015, cargo volumes have increased by 2.6 per cent to 1.5 million tonnes.

Heathrow Airport chief executive officer, John Holland-Kaye, says the UK govern-ment needs to approve a third runway as soon as possible. He says: “Heathrow ex-pansion is the right and deliverable solution for the whole of the UK. Every month that we delay is costing our economy £1 billion [$1.5 billion].”

Fellow UK gateway Gatwick Airport has seen another double digit YOY fall in Au-gust, with volumes dropping by 26 per cent to 5,677 tonnes. Between September 2014 and August 2015, cargo volumes fell by 13.5 per cent to 78,019 tonnes.

ACW 21 september 2015 6

F ollowing the introduction earlier this year of a new dedicated pharmaceutical facility in Philadelphia (US), American Airlines Cargo is considering further development of its temperature-con-

trolled infrastructure.Specific ideas under consideration by the

US carrier, which offers both active and pas-sive solutions through its ExpediteTC product, include developing CRT (controlled room tem-perature) from plus 15 to 25 degree Celsius facilities at more stations and adding some pharma-dedicated plus two to eight degree Cel-sius space.

Amercan’s cargo manager for cold chain strategy, Tom Grubb (pictured), stresses that all such ideas are still being evaluated and no firm investment decisions have been made. However, he confirms the organisation is looking at add-ing more CRT facilities in the US.

“In some of our locations such as Philadel-phia, New York and Miami, the existing CRT space is already quite robust in terms of avail-able capacity but there are other key stations

where we are currently assessing whether to invest in such infrastructure. One example is Los Angeles,” Grubb states.

More generally, continues Grubb, the carrier is assessing whether to also introduce plus two to eight degree Celsius space in some locations to cater for the growing range of biotech and blood products, vaccines, genetic material and other healthcare traffic requiring that sort of tighter temperature control.

“We already have significant +2⁰C to +8⁰C capabilities across our network but they are pri-

marily for flowers and other perishables. So we are taking a very strong look at where we need to have ded-icated pharma and healthcare space. I think that is the next major area of development we will be looking at,” he explains.

American looking to buildPHARMACEUTICALS

ENVIROTAINER is targeting innovation in temperature-controlled airfreight contain-ers for pharma and other healthcare cargo.

The company’s director for strategy and business development, Camille Madelon, says it is working on further improving its reliability and GDP (Good Distribution Prac-tice) compliance.

“We are investing a lot in our quality sys-tems and in CAPA (corrective and preventive action) to achieve the proactive resolution of issues when they arise. We are developing that together with the quality departments

of pharma companies,” she says. “We are also investing in the proactive testing and maintenance of our 5,000-strong contain-ers to continue strengthening their reliability and doing a lot of work on standard operat-ing procedures.”

Envirotainer is piloting a new integrated tracking system, called telemetry, for tech-nologically advanced containers. Madelon says it will be a huge contributor to more reliability and GDP compliance. The firm is also expanding its portfolio to better meet the needs of specialist types of shipment.

New pharma facility for Emirates SkyCargoEMIRATES SKYCARGO is building a tem-perature-controlled facility at Dubai International Airport’s cargo terminal dedicated to the handling and storage of pharmaceuticals.

The new 2,200 square metre module, is set to be operational in the first quarter of next year. It will include separate zones for storing products in different temperature ranges, specifically for two to eight degree Celsius and 15 to 25 degree Celsius. Last year, the carrier opened a similar 4,500 square metre facility at Al Maktoum Inter-national Airport at Dubai World Central.

Emirates SkyCargo’s senior vice presi-dent for cargo operations worldwide, Henrik Ambak, explains that it is “another concrete financial commitment to building substan-

tial new capacity for the pharma market”.“The big significance of this facility for us is that it will create a segregation between pharma products and any other type of cool chain traffic such as flowers, vegetables, meat, fish, and so on, in line with the GDP (Good Distribution Practise) drive to make sure there is a clean environment for phar-maceuticals,” he explains.

Innovation at Envirotainer

Cathay Pacific Cargo is responding to the increasingly complex demands of pharmaceutical shippers worldwide by further expanding the range of services offered in that market.

The most recent development in that context by the Hong Kong-based carrier, which provides various options for temperature-sensitive ship-ments under the product name Pharma LIFT, involved extending the choice of specialist con-tainers available to shippers.

Specifically, earlier this year it added the RKN and RAP Opticooler active tempera-ture-controlled containers from German supplier DoKaSch Temperature Solutions to an established range of Envirotainer and CSafe products.

Commenting on that development, Cathay’s cargo product and marketing manager, Jack Lo, explains: “We wanted to provide our pharma

customers with more options for several reasons. Firstly, if a particular supplier has insufficient containers available, then there is an alternative we can use. Secondly, it gives the customer more choices so they can satisfy their particular requirements.”

Meanwhile, geographically, Cathay is con-tinuing to develop its coverage of the Chinese mainland inbound and outbound pharma market.

“With our sister airline Dragonair, we are able to provide regular direct air access for pharma traffic to and from inner China cities such as Chengdu, whereas other airlines might have to route such shipments via Shanghai and use road feeder connections,” claims Lo.

In another development which further high-lights the ever-more stringent requirements of pharma shippers, the Cathay Pacific airline group responded to that industry’s growing demand for real-time temperature data by approving some wireless sensor devices for use on board its aircraft.

Cathay continues to grow its bellyhold net-work and is further increasing the opportunity to move pharma cargo.

On 10 September it announced a new four-times-weekly service to Madrid. Subject to government approval, the route will start on 2 June 2016. It will be the only direct link between

Hong Kong and Madrid.The carrier also added services to Manchester

(UK) in December 2014, Zurich (Switzerland) in March 2015 and Düsseldorf (Germany) in Sep-tember 2015 to its network from Hong Kong. The Zurich route will present the chance for Cathay to further tap into the pharma market.

Cathay adding pharma services for shippers

7ACW 21 septembeR 2015

PHARMACEUTICALS

Cool chain expansion for AF-KL-MPAIR FRANCE-KLM-MARTINAIR CARGO (AF-KL-MP) is plan-ning to add at least three more pharmaceutical dedicated cool chain handling facilities over the next few months.

The airline group’s product market group director for phar-maceutical logistics, Renate de Walle, says the first two developments are due to open in Cairo, and New York (US) in October, followed by Chicago (US), early next year. More will follow, she adds.

She tells Air Cargo Week: “With the increasing worldwide requirement to meet Good Distribution Practice regulations, our prime focus is to increase the quality throughout the air cargo supply chain, not just in the main hubs but globally.”AF-KL-MP is looking at adding more options to its two core product categories, closed cool chain (for pharma requiring the strictest temperature control) and controlled cool chain

(for temperature-sensitive goods within limited tempera-ture ranges). “With the cost pressures on shippers, we are seeing a need for a mixed product – a shipment booked at 15°C-25°C but on arrival at destination, cooled to 2°C-8°C. At the moment, that is being done for some shippers on a tailor-made basis but if de-mand increases, it could be added to the product portfo-lio,” says de Walle.

SWISS WORLDCARGO has responded to the increasing complexity of pharma market requirements this year by in-troducing a vertical management structure for that sector of the business. It has also announced two significant opera-tional developments.

The thinking behind the management change by the airfreight division of Swiss International Air Lines, which offers active and passive temperature controlled services under the product name Swiss Celsius, is outlined by its ver-tical industry manager for pharmaceuticals and healthcare, Susanne Wellauer.

“There is an increasing need to offer the industry sup-ply chain solutions, which means fully understanding its requirements. In the light of that, we believe the vertical management approach is the right way to go,” she says.

Operationally, Swiss World Cargo has this year seen ground handling partner Cargologic expand its cold storage facilities at Zurich Airport to provide more capacity for tem-perature-sensitive shipments.

Meanwhile, globally, the carrier is looking to boost its phar-ma business through a general collaboration memorandum of understanding signed earlier this year with Cargologic and Singaporean airport services provider SATS.

Developments for Swiss

ACW 21 september 2015 8

In light of the company’s cold chain management experience, the move was seen as a natural progression. The business spent €one million euros during the course of 2014 on new temperature-controlled facilities, forefront monitoring systems and staff training. BCUBE subsequently became the first firm in Southern Europe to pass the International Air Transport Association (IATA)rigorous compliance evaluation: Center of Excellence for Independent Validators in Pharmaceutical Handling (CEIV Pharma).

Pharma ProjectThe BCUBE ‘Pharma Project’ is, however, still in its early stages, as Mauro Grisafi, general manager of BCUBE Air Cargo, confirms: “We are a service company in a highly competitive market; an active presence on the international market does not depend on the price set but on the high qualification of processes dedicated to specialty products such as pharma.” The integration of dedicated services represents the project’s strongest point. The new airport facilities are governed by a single cloud-based monitoring system, have identical operational procedures (with crossed self-audits) and are connected by monitored temperature-controlled shuttles. Furthermore, both the organisation and the control line have airport buildings and resources assigned to pharmaceutical products.

By 2016, the integration of the first stage of the project will be completed through the qualification of the firm’s Venice and Milan Linate locations.

Innovation and SpecialisationGrisafi illuminates the company’s overarching aim: “It is our intention to overcome the low regard the pharma production world still holds towards airports,” Manufacturers of these products fear temperature deviations in the logistics chain and often – somewhat unfairly – attach blame to airports.

Fabrizio Iacobacci, institutional affairs and special project manager at BCUBE Air Cargo, outlines these negative associations: “Pharmaceutical manufacturers see the airport as a black hole, with shipments exposed in full sunlight, the distance between refrigerated cargo warehouses and aircraft parking slots huge and the high

number of operators involved in the airport handling service causing uncertainty.” What drives BCUBE’s Pharma Project is its desire to inject clarity and order into pharma logistics by reducing and controlling human intervention, limiting the number of steps and monitoring according to risk assessment criteria.

Iacobacci further states that: “The integrity of the cold chain is a combination of time and operation modes; from the booking phase, pharma goods are entered into our monitoring system through a web portal that controls all shipment handling processes until the release on ramp. We then guarantee the refrigerated transportation of the pharma shipment until it reaches the aircraft. The loading itself is performed according to mandatory procedures approved by the airport authorities.”

Another company goal involves responsibility: knowing exactly who does what and when. Inside the warehouse, the BCUBE monitoring system records every processing step, so that every detail concerning the shipment is known. “Even outside the temperature-controlled rooms,” says Iacobacci, “We have placed sensors to record temperature trends and potential related risks of exposure.”

Quality Control During 2014, BCUBE also reviewed its quality management system. The company has restructured its internal quality control process, improving its inner and outer checks. The culture of quality within pharma is reflective of the focus of BCUBE personnel throughout the business – not only at management level.

Grisafi underlines the rationale behind these changes: “BCUBE has a pharma manager for every platform who is directly and uniquely in charge as operational and customer care constant interface. The hierarchy chain for pharma is strictly linked with the quality manager duties on the one hand, and the operational manager responsibilities on the other, with a secure and efficient system of backup actions.” In order to gain superior training and qualification in 2015, BCUBE became the first organisation worldwide to have received formal recognition from the Envirotainer Academy for the accomplishment of all requested GDP training phases for the handling of active containers.

CEIV Pharma BCUBE is the first company in Italy to be IATA CEIV Pharma-certified, with its platforms recognised as a pharma handling excellence centre.

As an industry observer within the IATA Time and Temperature Task Force, as well as a participant of the CEIV Pharma programme, BCUBE believes that experienced, qualified contribution is a must in the airfreight community to reach a high global standard dedicated to pharma by air. Pharma’s confidence in its handlers is just a matter of time.

BCUBE Air Cargo is a subholding company belonging to the BCUBE Group, a major global player in integrated logistics services since its inception in 1952. With over 40,000 m2 of in-airport covered warehouses in Italy (FCO, LIN, MXP, VCE), more than 250,000 tons of import and export handled, and 100 airlines assisted, BCUBE is one of the main air cargo handlers in Italy. The company also has a road feeder service network in Italy and Europe.

FABRIZIO IACOBACCIInstitutional Affairs and Special Project Manager

PHONE: +39 (0) 2 58585354E-MAIL: fabrizio.iacobacci@bcube.net

BCUBE Air Cargoapplies its cool chain ideology to airport handling of pharmaceutical products in a bid to confront negligent presumptionsOnly in recent times have international guidelines truly acknowledged pharma handling at airports as a critical stage within the global supply chain – and thus afforded it the attention it warrants. The parameters issued within the European Union Good Distribution Practice (GDP) guidelines are pushing airport players towards a quality system that values specialist facilities, equipment and processes. BCUBE Air Cargo is one of the first companies in the world to have taken measures to fully understand the new era of pharmaceuticals handling by air.

ADVERTORIAL FEATURE

Singapore’s Changi Airport continues to attract new cargo services and to enjoy further expansion in the gate-way’s infrastructure.

In March this year, DHL Express announced that it is to invest 140 million Sin-gapore dollars ($100 million) in its new South Asia Hub at the Changi Airfreight Centre, which will increase its handling capacity by a factor of three and processing speed by a factor of six. The hub is expected to be ready for business in the first quarter of next year.

More recently, Polar Air Cargo Worldwide commenced a weekly Cincinnati - Anchorage - Incheon - Singapore - Hong Kong service with a Boeing 747 Freighter, adding sizeable cargo capacity between Singapore and the US, while operator Changi Airport Group (CAG) also welcomed the inaugural flight from Moscow of a AirBridgeCargo Airlines (ABC) (pictured) 747-8 Freighter at Changi Airport earlier this

month (September). The carrier is operating twice-weekly Moscow - Singapore - Hong Kong - Moscow services. ABC’s new services to Sin-gapore established Moscow as a new freighter city link for Changi Airport, and have strength-ened Changi Airport’s connectivity to Russia and beyond.

According to CAG assistant vice president for cargo and logistics development, James Fong, over the course of the next few months, the airport is “expecting additional new services and freighter links from both existing and new airlines.”

During the first seven months of 2015, cargo shipments reached one million tonnes – remain-ing fairly stable. But, “We have seen steady growth in pharmaceuticals and perishables, as well as express cargo, three of the niche cargo segments that Changi Airport is well equipped to handle,” Fong observes. “We are confident traffic volume will grow in the long run as trade

volume grows within and beyond the Associ-ation of South-East Asia Nations (ASEAN). Furthermore, the shift of manufacturing from North Asia to our hinterland ASEAN will spur air freight activities in the region which will be beneficial to Changi Airport,” he notes.

“Based on the feedback from our cargo part-ners, growth is expected at Changi Airport over

2015, mainly fuelled by North-East Asia and South-West Pacific markets. We continue to be focused on expanding connectivity and forging partnerships with airlines to better manage the fragility of the industry. In addition, we will continue to work with partner to develop high-yield niche segments to lay the foundations for sustainable long-term growth,” Fong adds.

Changi welcomes new business and more to come

9ACW 21 septembeR 2015

SINGAPORE

Singapore proving challengingAGILITY has been active in Singapore since the 1970s and has built strong foundations in the region, according to Eddie Sng, the firm’s executive director in the country.

Singapore represents the region’s foremost cargo gateway, due to its strategic geographical location, Sng ex-plains. A major portion of Agility Singapore’s own airfreight export business involves the hi-tech sector. Its airfreight imports typically consist of a mix of hi-tech products and consumer goods such as fashion garments and accesso-ries, and other retail goods.

“The Asia Pacific region continues to be a source of growth and offers tremendous opportunities. This is espe-cially true for intra-Asia trade where much of what’s made in Asia now stays within Asia. In fact, the intra-Asia trade lane represents the largest share of our airfreight business in Singapore and will continue to fuel growth,” he says.Singapore’s is experiencing declining yields and growing competition, making it challenging for freight forwarders, Sng warns. “Despite Singapore’s growing economy, the in-dustry continues to face a tough operating environment due to global economic uncertainty and reduced demand for airfreight. It would thus be pertinent for industry players to strengthen their competitiveness and develop innova-tive solutions in order to compete beyond cost.”

Singaporean freight forwarder Merstar International is investing in and expanding its operations when the oppor-tunity arise.

The firm’s managing director, Ronnie See (pictured) says: “It is our aspiration to keep revamping and progressing in meeting our clients’ requirements.

“We work to gain access to new markets and we are con-stantly looking out for new alliances and good partnerships around the world. Plus, we are continually upgrading our IT operations to meet the requirements of the industry. We have to keep revamping to find new niches to meet the clients’ requirements and continue to upgrade our opera-tions software and hardware systems in order to keep up in

today’s high-tech era. Finally, we are moving into providing warehousing and logistics distribution for local SMEs (small and medium-sized en-terprises),” he explains.Growth is coming, despite the operating environment not being easy, See observes. “Although the market is rather soft at the moment, this gives us time to consolidate and prepare for new challenges when the market recovers.”

Merstar invests in the future

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