Aircargopedia Newsblast: March 2017!
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11th MARCH 2017  

Dear Air Cargo Professional:

As promised in our last newsletter, I made the 8,000 miles plus trip from JFK to Johannesburg to attend the third edition of AIR CARGO AFRICA. The sixteen-hour non-stop flight each way is not for the fainthearted. Flying such long distances, especially in economy class, like I did with my 6 foot 2inch frame squeezed into a standardized seat, can be downright dangerous, and I am always reminded of the perils of flying in such constricted spaces. South African Airways delivers a decent economy class product, with acceptable leg room, though to my dismay the entertainment system did not function for most of the journey. So much for catching up on the latest movies. Clearing immigration and customs in Johannesburg though was a breeze, and I was in my hotel within an hour of landing at O.R. Tambo International Airport. In fact, it was the same hotel that I stayed in almost a decade ago, when TIACA had its Annual General Meeting there. The hotel now has a new owner and a new name.   DJ Ghosh


AIR CARGO AFRICA, like other conferences and expositions organized by the STAT TIMES group is a glittering event attracting the ‘crème de la crème’ of the global air cargo community. South Africa is a great destination for an African air cargo conference, and South African Airways is a great host and a generous sponsor. During the three-day event, I could either listen to or chat with the heads of cargo of Delta Airlines, Turkish Cargo, and South African Cargo, and the COO of Kenya Airways, while re-establishing contacts with leaders in the world of air cargo handling, airport administration, global air charter brokering, inter-continental freight forwarding, technology and equipment manufacturing. For a small publisher like myself, when I fly more than 32 hours and meet more than 50 air cargo luminaries, I can say that the trip was well worth the time and expense. Add to that the lavish lunches and the grand dinner parties, and you have a total home run.


History buffs will tell you that all of mankind originated in Africa, and that wherever you are in the world, you can trace your lineage back to Africa. Sadly, though, most of the African continent missed the boom years of the 20th century, so much of the land is still ‘virgin’ territory, waiting to be developed and exploited. During my rounds of the trade show, I chatted with Zhu Yingchun, Project Manager of the Djibouti Free Trade Zone Project Preparatory Group who explained how new Chinese investment was transforming this small nation to become the next hub of Africa. I have no doubt, that the Chinese realize the true potential of this continent, with Africa boasting the youngest population on the face of this earth.

E-COMMERCE IN AFRICA: There is no doubt that Africa holds tremendous promise and potential, even though the African air freight market is less than 3% of the world figure. While only 5% of Africans have a postal address, improving mobile connectivity has allowed locals to use mobile phones as their address, as per Sanjeev Gadhia, CEO of Kenya based Astral Aviation. Unlocking Africa’s true potential will require significant investments in infrastructure, with airports becoming willing partners in this process. Atlas Air, a carrier whose e-commerce component is becoming a core portion of their business, lists some of the challenges of doing business in Africa; including 100% inspection in some African nations, the inability of others to store transit cargo, poor harmonization of customs rules and processes, low credit card penetration and poor road infrastructure. Meanwhile, Astral Aviation continues to advance its plan to introduce its fleet of drones across Africa and is working with various nations to streamline and harmonize their drone regulations. On a much larger scale, Brian Bauer of Hybrid Enterprises is marketing the Lockheed Martin Hybrid Airship with a 21-ton payload to land in the remotest regions with no need for an airport. It made me wonder if drones and airships could be the new gamechangers that would allow African air cargo to bypass traditional airport based business models just like the mobile phones in India totally obliterated the need for government controlled land lines, with their long waiting lists.

Gareth Joyce
Gareth Joyce

DELTA AND TURKISH AIR CARGO STRATEGIES: The conference also highlighted some of the challenges currently facing the air cargo business. Gareth Joyce, Delta’s new President of Cargo emphasized that in an era of declining yields, speed is what counts in air freight as well as ‘end to end process capability’, extreme focus on service combined with process improvement and cost containment. Turhan Ozen, the new Chief Cargo Officer of Turkish Cargo(TK) emphasized that the future of the business of air cargo is ‘value creation’ and aligning the supply chain on an ongoing basis. He expects increasing yields to come from special cargoes and value added services. TK has an extensive and well researched array of special cargo products on offer, and will continue to add more value-added services, as it globalizes its cargo offerings. Istanbul will continue to be the major hub for Turkish Cargo, with a doubling of capacity in the offing, as it continues to grow the overall cargo business by 15% a year and the pharma products business by 30% on an annual basis, while increasing the freighter to belly-cargo ratio. While the African continent will be the fastest growing market for the air cargo industry, TK is aiming to be among the top 5 players on this continent by 2020. TK currently ranks 11th in Africa and is growing at an average rate of 25% over the last few years.

Anke Giesen
Anke Giesen

FRAPORT & SOUTH AFRICA: On the sidelines of the Air Cargo Africa meeting, I also got a chance to attend a press briefing by Ms. Anke Giesen, Member of the Executive Board, Fraport. In a room, full of air cargo reporters from all over the globe, we were pleasantly surprised to find that the women outnumbered the men. Frankfurt ranks among the top ten cargo airports worldwide, is the largest exporter in Europe, and 50% of air cargo flown out of Germany is flown out of Frankfurt. In 2016, one of the most challenging years for air cargo, Frankfurt managed to eke out a 1.8% increase in its cargo figures, ending the year with 2.152 million metric tons. Germany and South Africa have a healthy trading relationship, with the air freight trade dominated by auto shipments. Each week, 40 passenger and freighter flights connect the two countries. Frankfurt has other titles to its credit; the highest forwarder density in Europe, the largest perishable center and the largest pharma hub on the continent with 10,000 square meters devoted to pharma. While Lufthansa continues to be Frankfurt’s largest customer, any airport marketing executive will tell you that it is always wise to diversify your customer base as a risk mitigants. Ms. Giesen, is aware of this challenge.

IATA WCS IN ABU DHABI: The world stage now shifts to Abu Dhabi where IATA is having its annual World Cargo Symposium from March 14-16. Yes, for us in the USA it will be another long flight, but once again I will take out my calculator and work out the number of flight hours compared to the number of dignitaries I expect to meet. I have no doubt that the numbers will work in my favor and attendance at the WCS where on average 1,000 plus delegates from all over the world attend, will be a great bang for the air cargo buck. I hope to see you there.

Best wishes

D.J. Ghosh
President & Publisher
”The Complete Encyclopedia for the Air Cargo Professional & Investor”


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Kale Logistics augments its presence in Middle East with a new centre in Dubai

Kale has set up a customer service and business development centre at Dubai DWC to enhance its customer facing set-up for the Middle Eastern market.

Mumbai, March 07, 2017

Kale Logistics Solutions - a leading global IT solutions provider focused on providing cutting edge technology solutions to the logistics industry has increased its international presence with a new set-up at Dubai World Central, Dubai. This will act as customer facing center and will enable a deeper engagement for Kale with the logistics industry stakeholders.

Logistics and transportation industry has been witnessing an interesting transformation. Technology in logistics is changing the way the world does business. Kale Logistics Solutions has been enabling more than 2000 of its clients globally to connect and do business digitally.

Speaking on this development, Mr. Amar More, Director, Kale Info Solutions DWC LLC said, “We continue to expand our footprint globally, and specifically in Middle East. Dubai offers extremely lucrative opportunities for companies to take advantage of the region’s emergence as a global logistics hub and ease of doing business”.

“We see a huge potential in this region with wider acceptance of our IT solutions. We will be further expanding our portfolio in air and maritime space to bridge the technology gap that currently the logistics industry is facing”, added Mr. More.

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South African Airways Cargo wins the Air Cargo Brand of the Year in Africa Award

Johannesburg, 2 March 2017.

South African Airways Cargo is proud to have won an International Award for Excellence in Air Cargo in the category Air Cargo Brand of the Year in Africa.

This award is the first of its kind and forms part of the International Awards for Excellence in Air Cargo presented at a Gala Awards ceremony held in Rivonia, north of Johannesburg. The award is recognition for awareness and trust in the SAA Cargo brand based on its products and services. It demonstrates service reliability and is a confirmation that it is top of mind to airfreight users in Africa and those doing business with Africa.

The awards organised by STAT Times, the flagship publication of STAT Trade Media Group, an international multimodal transport media house based in India takes place every two years. The company has been recognising and awarding excellence in the air cargo industry since 2006, placing special emphasis on excellence in performance by air cargo operators.

Anke Giesen
Lusanda Jiya, General Manager: Group Corporate Affairs and Thola Nzuza, Manager: Marketing
and Communications – SAA Cargo, with the Air Cargo Brand of the Year in Africa award.

The award recipients were decided on by the worldwide readers of STAT Trade Times via two online polls. The first round took place from 3 to 31 December 2016 from where the awards committee selected the top five nominees in each category. Readers were polled again from 7 to 17 January 2017 to choose the winners who scored a maximum number of reader votes.

Readers consist of the cargo community, including airlines, shippers, and freight forwarders.

Mr Tleli Makhetha, SAA Cargo’s GM said: “We are proud and honoured to be recognised as a leading Air Cargo Brand in Africa in this prestigious Award, more so because it is recognition from the airfreight industry. We remain committed to serve their needs and provide a consistent and reliable service.”

Interesting facts about the Awards:
• STAT Times International Award for Excellence in Air Cargo was established in 2006 and is an integral part of Air Cargo India and Air Cargo Africa, the two international biennial air freight industry events taking place in India and Africa
• STAT Times International Award for Excellence in Air Cargo 2017 takes place in its fourth edition this year in Johannesburg
• The award is the manifestation of the STAT Media Group’s endeavor to identify and award the best in the global air cargo industry.
• South African Airways Cargo was the winner of the African Cargo Airline of the Year Award in 2013 and 2015 respectively.

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Aircraft Leasing, Support Services Drive 2016 Revenue Gains

Growth Will Continue in 2017, Adjusted EBITDA Projected to Increase 23%
WILMINGTON, OH – March 6, 2017

Air Transport Services Group, Inc. (Nasdaq: ATSG), the leading provider of medium wide-body aircraft leasing, air cargo transportation and related services, today reported consolidated financial results for the quarter and full year ended December 31, 2016.

Compared with prior-year amounts:
• Revenues increased 24 percent to $768.9 million for the year, and were up 22 percent to $221.7 million for the quarter. Excluding revenues from reimbursable airline expenses, revenues increased 18 percent for the year and 17 percent for the quarter. Principal contributors were ATSG's aircraft leasing, maintenance, and logistics businesses.
• Earnings from Continuing Operations were $21.1 million, or $0.33 per share diluted, for 2016 and a $755 thousand loss, or a negative $0.01 per share diluted, for the fourth quarter. These results include the non-cash effects of warrants issued in March 2016 to Amazon Fulfillment Services, Inc. in connection with operating and lease agreements. Fourth quarter and full year earnings were also impacted by a $7.0 million reduction in revenue and pre-tax earnings from continuing operations, equating to $0.07 per share, resulting from a work stoppage by Teamsters-represented ABX Air pilots in November.
• Adjusted Earnings from Continuing Operations, which exclude the non-cash warrant-related effects, were $37.5 million, or $0.58 per share for the year, and $12.0 million, or $0.19 per share for the fourth quarter. Adjusted Earnings and other adjusted amounts referenced below are non-GAAP financial measures. They are defined and reconciled to comparable GAAP results in tables at the end of this release.
• Pre-tax earnings from continuing operations were $34.5 million for the year and $420 thousand for the fourth quarter of 2016. Adjusted Pre-tax Earnings, which exclude the warrant effects along with additional non-cash items, were $65.1 million, up seven percent for 2016, and $17.4 million, down 11 percent for the quarter. These adjustments to pretax earnings are defined and detailed in the earnings summary table later in this release, and include non-cash warrant-related effects, pension expense, and debt-issuance charges.
• Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization as defined, and adjusted, in a table later in this release) increased seven percent to $211.8 million for 2016. Fourth-quarter Adjusted EBITDA was $56.4 million, even with the prior year. Adjusted EBITDA and the other non-GAAP measures above do not exclude the effects of the work stoppage in the fourth quarter.
• Operating cash flow increased 10 percent in 2016 to $193.1 million. 2016 capital expenditures were $264.5 million. Share repurchases were $63.6 million, or 4.8 million ATSG shares.

Joe Hete, President and Chief Executive Officer of ATSG, said, “In 2016, we completed a major set of long-term agreements with Amazon in support of its new dedicated air network, and by year-end began leasing 14 of the contracted 20 Boeing 767s for that network. A 15th Boeing 767 was leased to Amazon in early January 2017. Our aircraft leasing, maintenance, and logistics businesses met aggressive targets from Amazon and other customers while generating good margins. However, our airline operations, particularly those at ABX Air, incurred significant pilot training and premium pay related to expanded CMI operations, along with lower revenues due to a November ABX pilot work stoppage. Taken together, these factors reduced our second-half 2016 pre-tax earnings by approximately $20 million. After first quarter 2017, we anticipate costs at our airlines to be normalized. That, along with minimal non-cash pension expense in 2017, is projected to result in a profitable year for our ACMI Services segment."

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Aviance Ghana goes live on Kale’s GALAXY - a web-based air cargo management system.

Mumbai, Feb 28, 2017

Kale’s Air Cargo Management System – GALAXY selected by Aviance Ghana goes live at KIA airport, Ghana and delivers critical functionalities like EDI messaging, auto billing, tracking and reporting.

Kale Logistics Solutions - a leading global IT solutions provider focused on providing cutting edge technology solutions to the logistics industry announced that its client Aviance Ghana went live with GALAXY- Kale’s web-based airport cargo management system.

Aviance Ghana provides a range of ground handling services at the KIA airport in Ghana. It is a large cargo handler in Ghana and processes approximately 50% of all the airport cargo. It was looking for a robust system that could enable electronic data interchange (EDI), scalable and integrate with their internal applications.

GALAXY has helped Aviance Ghana to achieve 100% EDI compliance, thereby eliminating manual interventions, excessive paper work and bringing business visibility. The system integrates with Aviance Ghana’s website for customers to track their shipments 24x7.

Speaking on the occasion, Mr. Paul Craig, Managing Director, Aviance Ghana says, “We are happy with GALAXY as it met our requirements completely. The new system has helped us automate our operations and move towards digital logistics. At Aviance Ghana, our corporate goal is to deliver consistent service excellence. With new generation logistics technologies, we look at unlocking significant value and create customer-focused systems that build long-term competitive advantage.”

Speaking on the development, Mr. Vineet Malhotra, Director, Kale Logistics Solutions said, “Africa is emerging as the next-place-to-be for transportation and logistics industry and our solutions are witnessing rapid acceptance as we understand the needs of regional air cargo handlers. We are confident that our system will address all concerns that Aviance Ghana had with their earlier system and realize the benefits of GALAXY in the coming days”.

GALAXY is a web based air cargo management system in use at leading Airports. It helps cargo terminal operators, custodians and ground handling agents to overcome their challenges by addressing the key areas of planning, process integration, and collaboration. It automates the operational processes and provides quick and comprehensive information on consignment status, cargo tracking and terminal operations to customers as well as the management. It supports the airport in controlling the movement and storage of cargo at the warehouses and managing the transactions.

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Franz Heuckeroth van Hessen joins Liege Airport

Johannesburg, February 22nd, 2017

Liege Airport, the leading cargo airport in Europe, announced today the appointment of Franz Heuckeroth van Hessen as Vice President Air Services starting May 1st, 2017.

Luc Partoune, CEO of Liege Airport, praised Franz's qualifications and expects him to be a tremendous added value for the company : « Franz has a huge experience in the air cargo business and a large expertise in the logistics services and customers relationship. He has acquired along his career a deep respect and confidence all over the international cargo community ».

« With this addition to the cargo team, Liege airport will reinforce the leadership in the full cargo world and achieve the excellence in air services in Europe by creating a real Flexpress airport. We are excited to work together and develop the vision of integrated airport services into the Flexpress product ».

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Alaska Air Cargo Orders Astrophysics, Inc. Cargo X-ray Scanners

CITY OF INDUSTRY, Calif. (February 24, 2017)

Alaska Air Cargo ordered Astrophysics, Inc. (Astrophysics) XIS-1517DV 200kV X-ray scanners for its Pacific Northwest airline hubs. These X-ray systems will replace and upgrade aging cargo scanning equipment being phased out of service and standardize Astrophysics' technology across the airline's United States facilities.

The Transportation Security Administration (TSA) requires all cargo transported on passenger aircraft be 100 percent screened prior to being loaded onto planes. X-ray scanners used for cargo screening must be TSA-qualified and included in the agency's list of approved screening technologies. Astrophysics is proud to have eight (8) units qualified by TSA for cargo screening, including the XIS-1517DV 200kV ordered by Alaska Air Cargo.

Regarding the award, Astrophysics, Inc. CEO Francois Zayek stated: "Our XIS-1517DV 200kV X-ray scanners are the perfect solution for Alaska's critical mission. We are proud to add this machine to their inventory of Astrophysics products."

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London, UK, Monday, 20th February 2017

ANTONOV Airlines has carried out its first charter operation from its new UK headquarters at London Stansted Airport using machinery, which it designed to speed up loading of a giant helicopter.

The cargo, a British-manufactured helicopter measuring almost 4.4 metres high, travelled from the UK to Southeast Asia on one of the airline’s seven AN-124-100 freighters.

It was loaded at the Diamond Hangar at London Stansted Airport, the new UK home of ANTONOV Airlines.

"It is a wonderful coincidence that one of the UK office’s first operations should take place on its doorstep," said Paul Bingley, Commercial Manager, ANTONOV Airlines, who organised the charter.

"Such close proximity allowed us, not only to successfully test our specially-designed loading equipment, but also to work much more closely with our customer."

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"You could say we arrived at the right place at the right time."

ANTONOV Airlines was the first to offer the 150-tonne payload AN-124 commercially more than 28 years ago. The airline also operates the world’s largest aircraft, the 250-tonne payload AN-225 and a 60-tonne payload AN-22.

"Our team in Kiev was pleased to work closely with our UK office for this move," said Andriy Blagovisniy, Head of Commercial Development, ANTONOV Airlines.

"Our in-house engineering expertise meant we were able to deliver an expert solution for this aerospace customer and we look forward to supporting many more companies in the defence, energy, humanitarian, industrial, automotive, and oil and gas sectors."

ANTONOV is the design and maintenance authority for the AN freighter fleet, and boasts 13,000 employees providing technical expertise for moving project and outsized cargo safely and economically around the world.

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