Coyne Airways, the pioneering non-asset-based cargo airline, is again leading the push for innovative and sustainable solutions as the air cargo industry takes on a greater role in the new normal amid the continuing fight against the pandemic.
Founded by aviation entrepreneur Larry Coyne, Coyne Airways started from humble beginnings more than 26 years ago with zero investment and no defined routes, but emerged as the top cargo carrier in the Caucasus, Central Asia, Africa and conflict zones such as Iraq and Afghanistan.
Liana Coyne, Chief Operating Officer and Coyne’s daughter, who recently joined the Board of Directors of the global trade body, The International Air Cargo Association (TIACA), said liberalization for cargo flights and sustainability are the two most pressing issues confronting the industry right now.
“I would say that the two most pressing issues are liberalization and sustainability. Greater liberalization for cargo flights would allow the industry to be more efficient by being better able to manage asymmetrical flows as, unlike passenger flights, return loads are not always guaranteed. This would also eliminate some unnecessary flying to home bases, which would be better for customers and the environment,” she explained.
Adding, “Sustainability is a key issue for the industry and, at its essence, it is really imperative to take a long-term view. We need to do good for the planet, the people and the business to ensure our long-term survival.”
TIACA’s recently released sustainability report indicate that the majority of air cargo companies have concrete improvement action plans in place related to carbon reduction, waste management and energy as climate change continues to take its toll on our environment.
Drawing strength from TIACA
Amid the industry’s changing dynamic shift, cargo carriers and their supply chain are drawing strength from TIACA’s leadership to steer them to the right direction and be their voice on a myriad of issues.
Based in Miami, Florida, the non-profit group TIACA represents and unites all parts of the air cargo industry: shippers, forwarders, ground handlers, airports, airlines, manufacturers, IT providers, logistics, other groups connected to the industry, among many others.
Its vision is to keep a safe, profitable and united air cargo industry that embraces modern technologies and practices to sustainably and fairly serve trade and social development worldwide.
Coyne said the organization has worked tirelessly for the common good of all those in the industry as well as uplift its standards.
“I am thrilled to have joined the Board of Directors of TIACA, which is uniquely positioned to be the organization of choice for all actors in the air cargo community, regardless of size or market segment. TIACA has worked hard to become more transparent and responsive to members’ needs and it is focused on building on and enhancing its value proposition for members,” said Coyne, an Oxford-educated lawyer who was a law practitioner before deciding to join their family business.
“For example, in August 2020, TIACA joined forces with Pharma.Aero to launch the Sunrays Project in order to help the air cargo industry understand and prepare for the transportation of COVID-19 vaccines. TIACA facilitated discussions across the entire supply chain, and produced webinars, white papers and recommended practices and insights for safe and effective vaccine transportation. The support continues today with a regular newsletter, VacScene,” she added.
As the world grapples with the pandemic, TIACA showed the world that the air cargo industry its indispensable partner in sustaining economies, businesses, communities, and more importantly, people.
“I think this is a striking achievement: TIACA took note of an issue of importance to the industry – and the world – and worked at every level to increase understanding and efficiency, and to provide practical and timely advice. It also fits with TIACA’s mission statement to make the industry safe, profitable and united, and one which embraces modern technologies and practices to sustainably and fairly serve trade and social development worldwide. On a personal level, I hope to support TIACA’s efforts to provide meaningful support to members on issues that affect them as individuals, companies and us all as an industry,” said Coyne.
Overcoming challenges
Known for its forward-thinking approach, Coyne Airways carefully maneuvered its way to survive the new normal with prospects for growth in the future.
Coyne said the company saw a decline on its throughput, particularly in the heavy oil and gas sector, but the losses were offset by additional charter flights work they
“In terms of business, we did see a decline in our regular per kilo business to certain destinations, particularly those with a heavy oil and gas focus. We were forced to suspend service to some places, but we have been continuing to monitor demand and will resume service when possible. For example, we restarted direct flights between Cologne, Germany and Tbilisi, Georgia last month,” she shared.
“We have also faced issues getting capacity into our hubs with the reduction in passenger flights affecting interline capacity. Thankfully, we still get some good support from our airline partners, for both per kilo and charter capacity. We are grateful for that as we have increased our charter work, and this has helped offset the decline in per kilo and project work,” she added.
When the pandemic struck in March 2020, Coyne said their staff began working at home, except those who are needed on the frontline.
“It is safe to say that the year 2020 was challenging for everyone. I remember taking the decision early in March to send everyone to work from home. At the time, I wasn’t sure if that was an overreaction but I wanted to do what I could to keep my team safe and healthy. The official restriction on office work came through shortly later,” she recalled.
“I have been really impressed by how well the team has been able to work remotely to keep the business running. Now that lockdown has lifted, we have kept some of the flexibility,” she added.
Interconnected future
Like others in air cargo, Coyne is extremely proud of the way the industry stepped up to the plate to deliver vital medical and other essential supplies across the world during this crisis.
“I have been very proud of the way that air cargo has stepped in to distribute not only vaccines, but life-saving medical equipment, personal protective equipment and food. I am sure that there is a greater appreciation of the value of the industry and also how interconnected we are as nations,” she said.
But she cautioned, this is not the only crisis we will face, saying, “My concern is that we should not forget that coronavirus is not the only crisis, and it does not affect only rich countries. It is encouraging to see the COVAX scheme in place to try to ensure fair and equitable access to vaccines in 190 countries, but less so to see many countries cut budgets for international aid. The pandemic has exacerbated poverty in many places and, unfortunately, more humanitarian assistance may be needed in the near future.”
Given its greater role in facilitating global trade and sustaining lives and economies in the new normal, Coyne said air cargo needs to prepare for unforeseen events and crises as well as invest more on people and technology.
“I think that generally the air cargo industry copes well with unforeseen events and crises but this pandemic has been unprecedented and global. That said, I was impressed by how quickly we saw passenger planes repurposed for cargo, and how quickly a number of inventions aimed at maximizing passenger cabin capacity and reducing loading time came on the market.
“So I think the answer to your question points to the importance of sustainability in one of its many guises: we need an efficient, profitable industry that can withstand unforeseen events, and invest in people and technology appropriately,” she shared.
Within the industry, Coyne Airways is highly regarded for its drive and passion in delivering humanitarian cargo in conflict zones like Iraq, Afghanistan and Africa.
With the US positioned to pull out all its troops in Afghanistan by September after nearly 20 years since its invasion, Coyne expressed hope for the country to have peace and stability despite the odds.
“My enduring hope for Afghanistan is for a lasting peace and stability so that the country can flourish and prosper. Speaking frankly, I am not sure whether that will be possible in the wake of the withdrawal. From our side, we will do what we can to support the civilian economy,” she said.
Forward-thinking
With uncertainties looming everywhere and experts saying the global economy will remain difficult for many years due to the pandemic, the ever flexible Coyne Airways is ready to take on the challenges, focusing on its niche markets and their needs.
“Coyne Airways is a pioneering non-asset-based cargo airline, specializing in scheduled and chartered lift to niche destinations including Armenia, Georgia, Iraq, Afghanistan and around the Caucasus, Central Asia and Africa,” Coyne explained.
“We aim to give small company personal service with big company perks. That means getting to know and responding to our customers’ requirements so that we can, for example, blend interline lift and a
dedicated charter to get the right combination of price and transit time, and enabling them to check the status of shipments by phone, on the web, by automated email or on our app,” she added.
The airline has also upgraded its technology and IT solutions to speed up the process and give customers more advantages.
“We have a bespoke in-house system. We did look at replacing this with an off-the-shelf system, but we couldn’t find one that could be as flexible to our and our clients’ needs as quickly, or provide the data and reporting as we would like. We have, however, been working on integrating our system with others as part of a digitalization push,” said Coyne.
Asked about lessons we could all learn from this pandemic, Coyne said: “Life is precious. Tomorrow is not guaranteed. We owe it to ourselves and our loved ones to stay healthy and stick around as much as possible.
“Human connection is important; there’s a reason why solitary confinement is punishment. But there are probably still meetings that could have been emails. We are all interconnected and we are only as strong as our weakest link: no one should be left behind. Science is amazing.”
Indeed, tomorrow is not guaranteed and our survival depends on how well connected we are, and that includes enjoining air cargo.
Larry Coyne: Aviation entrepreneur and 2020 TIACA Hall of Fame Recipient
Larry Coyne, CEO of Coyne Airways and Coyne Aviation, has been selected by TIACA’s Chairman’s Council as the association’s 2020 Hall of Fame Recipient. The annual TIACA Hall of Fame Award honors professionals with outstanding achievements in the development of the air cargo industry, exquisite leadership record and an innovative spirit.
Coyne established Coyne Aviation in 1994, providing cargo charter flights to the fast-developing CIS countries, in particular to Transcaucasia and Central Asia. Coyne Aviation quickly became the number one cargo carrier to the whole of the CIS from Europe with a strong reputation for providing reliable and secure scheduled cargo services to some of the world’s hardest to reach destinations.
Not one to sit on the sidelines, throughout his career Coyne was a passionate advocate of security, liberalization of cargo traffic rights and the removal of obstacles to the growth of the industry. He saw that TIACA could be useful in pushing this call for reform and joined TIACA’s Industry Affairs Committee in 1998.
After serving on TIACA’s Industry Affairs Committee, Coyne was then elected to serve as Vice Chairman and eventually Chairman of the association where he championed security, liberalization and the growth of air cargo industry.
“Larry always has been passionate about our industry and a true believer in the value of TIACA. He has contributed a lot to our organization and to our industry. I am thankful for the advice he has given me during my time as Chairman. It is an honor to see that Larry will now be part of the famous Hall of Fame,” stated Sebastian Scholte, Chair of TIACA’s Chairman’s Council.
Coyne joins a star-studded group of 54 air cargo leaders who have received the prestigious Hall of Fame Award since its launch in 1997.
“I am very happy to receive this award and would like to thank TIACA’s Chairman’s Council for picking me as a member of such a distinguished group of individuals. I feel honored to be in the same group as the 50 or so existing members of the Hall of Fame. They have all done exceptional things, perhaps somewhat against the odds which has impacted the way we go about our business today. I didn’t think many people had taken note of a non-asset-based cargo airline that started from scratch 26 years ago with zero investment and no defined routes,” said Coyne.
“But thanks to a lot of hard work by our dedicated staff, we managed to move around 250,000 tons of cargo generating $1 billion in sales while remaining profitable every year. This is something I am especially proud of, all achieved with no aircraft of our own, no debt and with a reputation of flying to far flung and unpronounceable places,” he added.
DUBAI: One out of 20 COVID vaccines rolled out globally has transited through Dubai and as governments and health authorities around the world ramp up efforts to immunize people against the Coronavirus, Emirates SkyCargo reiterated its commitment to safely transport vaccines, pharmaceuticals and other medical supplies to fight the pandemic.
Data showed more than 1 billion doses of COVID-19 vaccines have so far been distributed across continents. Emirates SkyCargo, the air freight division of Emirates, has been leading the international air cargo industry in the transportation of COVID-19 vaccines and other essential pharmaceuticals, PPE and food supplies during the pandemic.
The air cargo carrier said it has moved around 59 million doses of COVID-19 vaccines to more than 50 destinations around the world. It has also transported six different types of COVID-19 vaccines on its flights.
Emirates SkyCargo says it has a dedicated GDP certified facility at its hub in Dubai used for storing and transporting COVID-19 vaccines from manufacturing locations to a destination network spanning six continents.
With its modern widebody aircraft, innovative equipment such as Cool Dollies and specialised containers, Emirates SkyCargo has been able to safely and rapidly deliver around 5% of the total COVID-19 vaccines administered around the world since October 2020.
In January 2021, Emirates SkyCargo joined hands with DP World, Dubai Airports and International Humanitarian City to form the Dubai Vaccine Logistics Alliance. The Alliance partners work together to facilitate the rapid transport of COVID-19 vaccines and related medical supplies through Dubai to developing countries. In February 2021, Emirates SkyCargo joined hands with UNICEF to expedite transportation of COVID-19 vaccines under the framework of the COVAX facility, aimed at equitable distribution of vaccines to global communities.
Dubai and the UAE have maintained their leading position at the center of global logistics and supply chains during the COVID-19 pandemic. The UAE has also made rapid progress in vaccinating its citizens and residents against COVID-19, with more than 10 million doses of COVID-19 vaccines administered to date. Emirates recently operated a special flight EK2021, to celebrate the UAE’s progress in its vaccination drive.
Emirates SkyCargo is a world leader in the air transportation of temperature sensitive pharmaceuticals and vaccines. More than 200 tons of pharmaceuticals are transported around the world everyday by Emirates aircraft, helping deliver cures to global communities. It also has a specialised product ‘Emirates Pharma’ for the safe and efficient transportation of temperature sensitive pharmaceuticals.
The air cargo carrier says it has also been working closely with ground handling partners across more than 30 different destinations across the globe to provide enhanced origin to destination temperature protection as part of its pharma corridors program.
This pandemic has created an era of unprecedented disruptions and uncertainties colliding with possibilities and innovative solutions never before seen in history which many hope will lead to better times.
While uncertainties are still very much felt anywhere with poverty and unemployment rising, more than 135 million infected with COVID-19 virus and related deaths rising to nearly 3 million worldwide, new possibilities and opportunities are also abundant.
There are the mRNA COVID-19 vaccines that took less than a year to develop instead of years had traditional methods been used, virtual work and business, social distancing, the rise of touchless & contactless buying thru e-commerce, use of passenger planes for air cargo, ebooking on air cargo and trucking, digitalization in the manufacturing industry and so on.
And while the global recession lingers on due to the pandemic, some industries like air cargo remains dynamic, agile and growing.
With most passenger flights still grounded, air cargo felt the pinch with the loss of belly capacity. However, the rise in demand for air flown goods, particularly vital medical supplies and vaccines, offset this with cargo yields estimated to be up more than 40 percent and performance varying widely by carrier.
Air cargo airlines with dedicated freighter fleets, especially those with express and charter flights, have seen the most growth in cargo volumes and revenues.
ECS Group & CMA CGM Air Cargo
ECS Group, the leading global GSA company, is among those that broke new grounds amid the air cargo industry’s rise in these challenging times.
The Group has forged new partnerships in different regions and airlines, including new players in the industry like CMA CGM Air Cargo, the newly-formed air cargo carrier by global French shipping line CMA CGM Group.
Adrien Thominet, ECS Group CEO, told Air Cargo Update, he’s very much delighted with their new partnership which he sees to grow further in the future.
“The CMA CGM Group’s decision to open an air cargo division is in keeping with their development strategy and their desire to diversify the freight offering available to their clients. Some of these clients require fast transport, particularly in the luxury and tech sectors. Demand is high, and with the slowdown in passenger activity, hold capacity has dropped significantly,” said Thominet.
CMA CGM Air Cargo has initially commissioned 4 cargo aircraft and recently launched its 10 weekly flights between Liege and Chicago.
“This is excellent news for the industry, with new opportunities for forwarders in this highly dynamic sector and a more diversified offering with multimodal solutions. Our teams at ECS Group sell the CMA CGM group’s capacity on its behalf, and the aircraft are full. It’s a very good sign for things to come and we firmly believe that their aggressive strategy of development in the air cargo sector will soon enable them to become a key player in our industry,” said Thominet.
The ECS CEO said sales are strong for CMA CGM Air Cargo and the industry has quickly warmed up with the new airline.
“Our partnership has got off to an excellent start – sales are strong and it’s been very well received by the industry. Over the coming weeks, our partnership will accelerate even further with the arrival of two additional A330 aircraft that would serve the Middle East. Our goal is to work together to create a global network – that’s what we’re currently working on with the CMA CGM group, while also taking optimizations to the A330s into account,” he said.
“In my view, this is a very promising partnership, with many developments still to come. Our expertise is complementary, our networks are complementary, and we will be able to create a whole host of opportunities as a result,” he added.
While challenges are still there, Thominet expressed confidence the new airline will pivot its way to success saying, “There are a number of challenges to overcome, but we’re already overcoming them thanks to our joint effort. Firstly, CMA CGM is a newcomer to air cargo, and so it needs to find its place. But as I said earlier, capacity is selling very well and we have used all of our expertise and our entire network to support our client by promoting and marketing their capacity.
“What’s more, I think that CMA CGM Air Cargo has arrived at the perfect moment – there is real demand and the reception it’s been given couldn’t be better. Other challenges include creating connectivity within the network to develop supply, create new segments, and ultimately succeed in developing a multimodal approach. It’s a longer-term, multi-step process, but I’m convinced that we’ll get there.”
2020: An Unusual Year
2020 was probably one of the most difficult year for many people and companies, including ECS which represents hundreds of companies in over 50 countries through its 167 offices worldwide.
Thominet described 2020 as both “difficult and unusual” that brought unprecedented challenges and growth at the same time.
“It was a difficult and unusual year for us as well, but overall, I would say that we withstood the crisis better than the market (which recorded a 35% decrease in volume and a 30% increase in revenue). There are many challenges as a result of uncertainty, market fluctuations and new ways of working (both within the group and with our clients and partners),” he said.
“What enabled us to better withstand the crisis was first and foremost our expertise, our ability to adapt and our capacity to offer solutions to our clients. This meant we were very quickly able to offer our clients new outsourcing solutions so they could optimize their costs and revenues to the greatest possible extent. And above all, with our main partners, we focused heavily on preighter operations and charter activity, putting these operations in place – sometimes from A to Z – in record time,” he further explained.
The ECS CEO said the biggest change occurred at their organizational level with remote working quickly adapted for safety reason while keeping up their services with their clients.
“The reorganization was needed to enable us to continue to offer new business solutions to our clients, such as data capture, for example, as well as management of all ops aspects (including Quality, Safety and Security) and solutions to respond to the growth in e-commerce (GSA Mail Solutions) which developed even further with the pandemic.
“All of this allowed us to take the initiative and offer our clients a wide range of solutions to increase their revenue and/or reduce their fixed costs, which are crucial in light of the current situation,” he said and praised their teams at different parts of the world. “I’d also like to pay tribute to the exceptional work of the groups’ teams and the solidarity they have shown – these two factors clearly made all the difference.”
Optimism in the new normal
The global economic collapse caused by the pandemic is so massive experts believe it would take years before recovery can be reached. Vaccine distribution delays, new virus variants that are more spreadable and resistant to vaccine, market fluctuations, political uncertainties and other external factors could also impact how fast global economic recovery can be realized.
And certain frontline industries like healthcare, airfreight, among others, need to be strong to support lives, livelihood and businesses.
Thominet said he remains optimistic about the future despite uncertainties with many opting to adapt rather than be defeated by an invisible enemy.
“My vision continues to be an optimistic one because the industry has shown just how capable it is of quickly reorganizing and adapting to a sudden change in the situation. Despite everything, there are still many difficulties to overcome because uncertainties surrounding the months ahead remain, and many airlines are in a difficult position given the absence of passenger flights,” he said.
“I think that we’ll also see new stakeholders emerge in our industry, many of which will be linked to the e-commerce boom, to new-found awareness of air freight, and of course to the acceleration of digitalization within our industry,” he added.
Accelerated Digitalization
ECS is among major companies that have prioritized digitalization long before the pandemic highlighted the need to transition to smart technologies.
Its investment is paying off and the company is convinced it must sustain this move to keep up with the changing times and new technological trends in the era of the Fourth Industrial Revolution.
“Yes, we have continued with – and even accelerated – our digitalization by continuing to invest despite the crisis. The idea is that digital transformation within the industry is in its infancy, that it will be one of the keys to recovery, and that demand is growing in the sector. As digitalization is destined to increase and service providers will undoubtedly become stronger (as happened on the passenger side), we thought it was essential to be ready for the next steps. This is the reality, and we are ready,” Thominet said.
“We’re also convinced that by doing this, we will get through the crisis more easily. We’re able to improve yield management thanks to our in-house business intelligence tool (Apollo); boost our responsiveness, performance and reliability by optimizing processes; continue to train our employees all over the world thanks to our e-learning platform (Discovery); and increase our clients’ visibility via partnerships with the main e-booking sites,” he added.
While air cargo is keeping up with the demands of the times, Thominet opined it needs to step up efforts to embrace digitalization.
“The industry needs to make up for lost time and go fully digital. I think that for many, the crisis has revealed just how necessary this is. We support our clients in this field and this makes us the GSA that offers the greatest range of advanced digital solutions. Without giving an exhaustive list, the main tools we’ve developed in-house are: Apollo: business intelligence and reporting system; Quantum: quotation tool supporting the ad-hoc pricing process; Discovery: internal e-learning platform; Pathfinder: shipment tracking system,” he said. “We also use the best technologies and tools available on the market, for example by working with the main e-booking platforms, as well as Wiremind and Skypallet, which help to optimize loads.”
Global Partner
The pandemic has no doubt exposed both vulnerabilities and strengths of different economies and industries like aviation and healthcare. Many have fallen and others remain struggling.
Air cargo, on the other hand, has shown its remarkable strength and agility in the face of adversity but Thominet said there’s no time for complacency.
“Air cargo has shown just how indispensable it is in keeping the global economy running and providing rapid support to people worldwide. It has demonstrated an impressive level of responsiveness and the hard work of the industry’s teams has been recognized the world over, so much so that if another event such as this were to happen, the sector would be ready. That said, the pandemic has also weakened many stakeholders and the market needs to do all it can to self-regulate. It’s essential that sufficient yields are reached to allow airlines to continue their growth. Our industry itself must offer and provide solutions for a sustainable recovery. It’s up to our industry to shape its future,” he said.
And as the head of ECS Group which breathes life to dozens of cargo carriers across the world, Thominet said finding solutions is crucial to the business.
“And at ECS Group, that’s exactly what we’re doing – we’re constantly creating new solutions that are adapted to the circumstances and emerging needs of our clients. This way, we enable airlines to outsource more of their costs, but also to develop new income-generating activities. All of these solutions are of course entirely bespoke, recognizing the fact that each airline has its own unique needs,” he said.
Global trade has resumed albeit far from the pre-pandemic pace it’s accustomed to. The airfreight industry, which accounts for more than $6 trillion of goods traded worldwide annually, is there to ramp things up.
Thominet said one of the valuable lessons he learned in this pandemic is that expertise and human analysis are still, by far, our best tools, to rise above our challenges.
“One of the lessons I’ve learned is that in a time of crisis or when faced with an uncontrollable and unforeseeable new situation, expertise and human analysis are by far our best tools to emerge from it. The air cargo industry has demonstrated its ability to transform itself during the pandemic and to take the reins to offer transport solutions in response to the drastic fall in passenger flights and hold capacity. Pre-pandemic, cargo made up 5-10% of airlines’ revenue.
“Today, though, it accounts for 30% of their income. This makes it a powerful economic driver for them. As a result, it needs to be supported and championed so it can continue to play its role as a driving force for airlines but also more broadly for global trade,” he concluded.
DUBAI: As the Middle East continues to reel from the devastating impact of the pandemic, the International Air Transport Association (IATA) has called on the governments in the region to develop plans to safely re-link people, businesses and economies to global markets when it becomes safely feasible.
In 2020, Middle East airlines posted losses of $7.1billion, a loss of $68.47 for each passenger flown. With traffic at less than 20% of 2019 levels, the cash burn continues even with severe cost-cutting. And job losses in the region climbed up to more than 1.7 million.
Kamil Al Awadhi, IATA Regional Vice President for Africa and the Middle East, said: “Re-establishing air connectivity will energize the economic recovery from COVID-19. With millions of jobs at risk from the prolonged shutdown, not a day should be lost once the epidemiological situation enables a re-opening. Restarting safely after a year or more in lockdown will need careful preparations.”
“At the national level it is important that governments work with industry, so everyone understands the benchmarks that need to be achieved to facilitate the lifting of travel restrictions. And at the regional level, where traffic is expected to ramp-up first, it is critical that governments are talking to each other so that all parties are aligned and ready for a restart,” he added.
IATA data shows January air passenger traffic in the region was down 82.3% compared to January 2019. The ongoing crisis puts over 1.7 million jobs in the Middle East and $105 billion in GDP at risk.
“This is a unique situation. But we have good practices to rely on. Safety is the top priority for anything associated with aviation. That is because governments have long established global best practices for working together with industry and with each other. This same approach will help the re-start. There are two ends to every route. Both must be prepared or the restart cannot happen,” said Al Awadhi.
IATA highlighted two critical areas of areas where governments need to work together:
A successful operational restart will include bringing aircraft and terminals back into service. Airlines need to ready their crew, technical personnel and aircraft. After a year of lockdowns, this requires refresher training and checks. A regional overview is needed to (1) ensure that the one country’s restart qualifications are accepted by its regional partners and (2) ensure that sufficient infrastructure capacity is ready to meet demand as markets unlock.
Testing and vaccinations will play a role in opening borders to travel as the pandemic comes under control. Simple, efficient, and harmonized standards for what credentials people will need to travel will boost consumer confidence and give strength to the recovery.
The ICAO Council’s recent approval of requirements for globally accepted COVID-19 test certificates, including the technology framework for secure digital versions and the future incorporation of vaccination certificates provides a global framework. Cooperation for a harmonized implementation across the Middle East will put the region on a solid footing for recovery.
IATA Travel Pass will help to conveniently manage health credentials, while protecting against fraud. “With Qatar Airways already piloting IATA Travel Pass and Emirates, Etihad and Gulf Air signed-up for trials, the Gulf is at the forefront of preparations,” said Al Awadhi.
Continued financial relief essential
Airlines in the region received $4.8 billion in government aid in 2020. Most of this support ($4.1 billion) was distributed through direct cash injections. Despite this several airlines in the Middle East remain at risk of bankruptcy or business administration.
“A financially viable air transport sector will be needed to energize the recovery. Government relief for airlines has avoided massive failures that would jeopardize a restart. This has not been uniform across the region. With no clear timeline to recovery the situation is far from resolved. Governments that have provided relief will need to be prepared for more. And governments that have not yet stepped-up must recognize the growing risks to their economies as the crisis drags on,” said Al Awadhi.
Middle East Aviation – 2020 in Numbers:
In its more than 26 years in the air cargo industry, Lufthansa Cargo has never been busier than now. Like other airfreight carriers in this time of the pandemic, the airline rose to the challenge of flying vital medical supplies and pharmaceuticals across continents as countries race against time to save lives and prevent the further spread of the COVID virus.
In Financial Year 2020, Lufthansa Cargo revenues rose by 11 percent to EUR2.76 billion, its best result so far since its establishment in 1994. The company’s adjusted EBIT amounted to EUR772 million (previous year: EUR1 million), corresponding to a margin of 28 percent.
This, even as the belly capacity of its allied airlines were lost for many months due to the global travel ban and the lockdown. In 2020, Lufthansa Cargo said it sold 6.5 billion freight ton kilometers (-27 percent). Average load factor improved by 7.8 percentage points to 69.1 percent, while cargo capacity shrank by 36 percent.
Working closely with passenger airlines within the Lufthansa Group—Lufthansa, Austrian Airlines, Brussels Airlines and Eurowings—Lufthansa Group also made hundreds of flights using passenger planes converted as freighters temporarily to transport goods.
Dorothea von Boxberg, Chairperson of the Executive Board and Chief Executive Officer of Lufthansa Cargo, who officially assumed her new role on March 1, said, “We are pleased to close what was probably the most challenging year in our company’s history with a record result. It is also a record in terms of the commitment and flexibility of our workforce—and we are proud of the outstanding cooperation with our long-standing partners and customers.”
At the company’s annual press event held virtually for the first time on March 5 due to the extraordinary circumstances we now live in, von Boxberg underscored the airline’s plan to move forward with digitalization along its entire transport chain.
“This success enables very decisive investments in our future. We want to make airfreight sustainably better and further strengthen our home base in Frankfurt. That is why we will gradually modernize our cargo center in the coming years and continue to drive forward digitalization along the entire transport chain,” she said.
The company is optimistic sustaining growth made in 2020 with demand for air cargo still high. Volumes from China remain strong and consumer confidence in Europe is still stable.
“Airfreight is a very volatile business,” said von Boxberg. “But for this year, we can say that we will have a good year in airfreight again although it will probably not quite stay at the record levels we have seen in the past months. People will import more.”
Upgrading Frankfurt’s cargo center
At the heart of Lufthansa Cargo’s airport-to-airport airfreight business, which serves around 300 destinations in more than 100 countries with its own fleet of freighters and the belly capacities of passenger aircraft operated by Lufthansa German Airlines, Austrian Airlines, Brussels Airlines, Eurowings and SunExpress, is Frankfurt Airport.
The airport is home to Lufthansa Cargo Center which begun undergoing modernization in January 2021 following the approval of the Supervisory Board of the German airfreight company to invest on the infrastructure.
The center’s comprehensive infrastructure modernization project is expected to be completed by 2028. It involves not just new buildings, but upgrades to existing building sections and warehouses, as well as improvements on logistics systems and internal material flows, thus, making Lufthansa Cargo’s operations even faster and more efficient.
Lufthansa’s Cargo Center in Frankfurt handles about 80 percent of its global freight volume. The increasing shipments for e-Commerce, new product requirements and the airline’s commitment to digitalization prompted the center’s upgrading, officials said.
Fleet modernization
Continuing with its fleet modernization program, von Boxberg also disclosed Lufthansa Cargo is adding another Boeing-777F to its freighter fleet.
The twin-engine B-777F plane is the most efficient freighter in its class. It’s scheduled to arrive by fall 2021 in Frankfurt where it will also be stationed.
“This year, we will add another highly efficient Boeing 777F aircraft to our freighter fleet. In doing so, we will also secure jobs in the cockpit and in other areas,” von Boxberg announced.
The new plane is a welcome addition to Lufthansa Cargo’s freighter fleet with increasing demand for air cargo. It will also complement bellyhold capacities of Lufthansa Airlines, Austrian Airlines, Brussels Airlines, Eurowings and SunExpress, to meet customers’ demand.
“Now that we are optimally positioned with one of the world’s most modern freighter fleets, we will work with our customers to drive forward the regular use of sustainable fuels,” von Boxberg said. In November 2020, Lufthansa Cargo had already become the world’s first cargo airline to operate a rotation fully compensated with Sustainable Aviation Fuel (SAF).
Fleet modernization is not confined to Lufthansa Cargo with Lufthansa Airlines considering to ditch older aircraft. The CEO of Deutsche Lufthansa AG or Lufthansa Group, Carsten Spohr, described 2020 as “the most challenging in the company’s history” and “2021 will be a year of redimensioning and modernization for us.”
“The unique crisis is accelerating the transformation process in our company. 2021 will be a year of redimensioning and modernization for us. The focus will remain on sustainability: We are examining whether all aircraft older than 25 years will remain on the ground permanently,” Sporh said in a statement.
“From the summer onwards, we expect demand to pick up again as soon as restrictive travel limits are reduced by a further roll-out of tests and vaccines. We are prepared to offer up to 70 percent of our pre-crisis capacity again in the short term as demand increases. With a smaller, more agile and more sustainable Lufthansa Group, we want to maintain our leading position worldwide and secure the jobs of around 100,000 employees in the long term,” he added.
In an extremely challenging environment for the entire aviation industry, the Lufthansa Group’s logistics subsidiary succeeded in maintaining its global connections with cargo aircraft at all times. The cargo airline countered the pandemic-related, continuous changes in entry regulations for crews, for example, with extremely flexible network planning, officials said.
Rolling out vaccines worldwide
While the global distribution of medical supplies remains a high priority, airfreight carriers are also tapped to distribute COVID-19 vaccines around the world.
The International Air Transport Association (IATA) described the COVID vaccine distribution as the “mission of the century” saying just a single dose needed to provide for 7.8 billion people across the planet would fill 8,000 B-747 cargo aircraft.
The international trade body said careful planning, well-established global time and temperature-sensitive distribution systems are needed not just on air but on land as well to safely deliver the vaccines.
Lufthansa Cargo said it has created a new product specifically for COVID-19 vaccine transports. The product called COVID-19 Temp Premium was opened for booking since 11 January 2021. It provides a high level of comprehensive and personalized customer service along the travel chain, including seamless monitoring of vaccine shipments throughout the entire process and a 24/7 after sales support.
Drawing on its many years of experience in handling medical goods and pharmaceuticals in addition to having some of the best cold storage facilities at varying temperatures, Lufthansa Cargo is also capable of handling larger volumes of vaccines fast and safely.
The company added it has already invested heavily in its temperature control facilities, including the brand new Lufthansa Cargo Pharma Hub Munich as well as the recently extended and upgraded Lufthansa Cargo Pharma Center Chicago at O’Hare International Airport.
Furthermore, with its pharmaceutical hubs and up to 200 other stations with Active Temp Control or Passive Temp Support services worldwide, Lufthansa Cargo has one of the world’s largest airline pharmaceutical networks. 30 of these stations are already CEIV Pharma-certified.
At least seven different types of COVID vaccines have been approved for roll-out as of February 2021. Various data showed nearly 400 million doses have been distributed across 122 countries. The World Health Organization said more than 200 additional vaccine candidates are in development, of which more than 60 are now in clinical development.
But despite billions invested in producing COVID-19 vaccines by different governments and philanthropists, there remains a massive shortage due to scarce resources in producing them. In the US, for instance, both Moderna and Pfizer’s vaccines which contain billions of lipids, are experiencing shortage of lipid supplies because only a handful of factories produce them.
There has also been reports of shortage of glass vials to store the vaccines, syringes among other medical supplies. And the air cargo industry must deliver them as well fast and safely.
Dorothea von Boxberg: Lufthansa Cargo’s new CEO & Chairperson of the Executive Board
Dorothea von Boxberg has been the Chairperson of the Executive Board and CEO of Lufthansa Cargo AG since 1 March 2021. Her responsibilities include Business Development and Cooperation, Legal Affairs, Communications and Corporate Responsibility, Information Management and Digital Transformation, as well as Finance and Controlling.
Born in 1974, von Boxberg studied Industrial Engineering at TU Berlin and as part of a double degree program at ESCP Paris.
She began her professional career in 1999 at the strategic management consultancy Boston Consulting Group. She worked in various industries and several countries.
In 2005, she left to join the Star Alliance management company, where she was responsible for strategy.
In August 2018, von Boxberg was appointed to the Executive Board of Lufthansa Cargo AG as Chief Commercial Officer. Her areas of responsibility included Global Sales, Revenue Management and Pricing, Product Development, Network Planning, and Handling outside the Frankfurt and Munich hubs. The digitalization of commercial processes and the expansion of multi-channel sales were among the most important tasks.
JEDDAH, KSA—Saudia Cargo has signed a cargo agreement with one of the leading IT and logistics operators, Cainiao Network– the logistic arm of Alibaba Group – to support e-commerce operations between China and Europe through five weekly flights from Hong Kong to Liege in Belgium with Riyadh as the main transit point.
These flights will form a sky bridge between Asia and Europe to cater to the high demand on e-commerce which lately became the world’s top shopping preference.
Saudia Cargo CEO, Omar Hariri, commented: “We are excited for this strategic agreement which will enhance logistic services between the two continents through the famous Alibaba’s e-commerce platform and its high traffic of online shoppers. This agreement is part of our framework to transform the Kingdom into an open gate for world trade and a bridge connecting East and West by leveraging its strategic location in the center of the world. Other promising partnerships will be coming up in the near future to reinforce logistic operations of Alibaba in both continents.”
“The global pandemic has revealed the urging need for cargo services due to the rapidly growing demand on online shopping. We are working closely with our worldwide partners to execute the most effective logistic solutions to guarantee a constant flow of cargo with punctual delivery,” he added.
Cainiao logistic services cover more than 200 countries around the world placing the company as one of the most popular logistic services providers for many retailers and consumers globally.
“We are happy to launch of collaboration with Saudia Cargo. Both our sellers and customers from China, Saudi Arabia and Europe will benefit from the new flights that will decrease delivery time for their parcels. Expanding our logistics network into new regions will also help us in building efficient global exports network. This new route will be one of the key elements to create seamless logistics and increase synergy between different regions,” said William Xiong, Cainiao’s Chief Strategist and General Manager of Export Logistics.
Since the start of the pandemic, Saudia Cargo has announced several measures to ensure the continuity of its highly efficient logistic operations such as increasing cargo flights to many destinations in Middle East, Africa, Europe, Asia and USA to keep a regular flow of vital products and maintain the economic and commercial sustainability in the Kingdom.
With a fleet of 7 freighter aircraft (4 Boeing 777 and 3 Boeing 747-400F), Saudia Cargo has adequate space and tonnage capacity to haul e-commerce goods on different routes, cared for by highly trained personnel who ensure the safest delivery.
The digitalization campaign in the air cargo industry has been going on for many years. But it wasn’t until this Coronavirus pandemic came that all players in the sector and its supply chain, big or small, were convinced that it’s indeed time to upgrade the system and invest on smart technologies.
As more businesses adapt to the market dynamics of the new normal where contactless transactions have become the norm, more digital solutions are introduced and used in different industries like air cargo, which at the height of the crisis became an instant life-saver, hauling countless tons of vital medical supplies & equipment and other basic necessities across continents, despite the virus threat.
Seeing the need to link further the air cargo industry to the digital world, aviation expert and entrepreneur Matthieu Petot launched CargoAi in 2019 by assembling a team of experts in airfreight, technology, products, customer success and sales.
So, what does CargoAi do? CargoAi is a SaaS application offering air cargo digital solutions to freight forwarders, airlines and GSAs, allowing users to manage the entire air cargo booking process via a single tool.
Part of that pioneering team is Mathilde de Rocquigny, Chief Commercial Officer of CargoAI, one of few women who hold a top management position in the air freight male-dominated industry.
Thriving in air cargo & tech industries
With a dynamic and innovative team, de Rocquigny, a French national, continues to break the glass ceiling for women while thriving in air cargo and tech industries, fields both associated with men.
A “pure product of airlines and airports business” posted in different countries, de Rocquigny told Air Cargo Update she finds the industry a challenging environment but with lots to offer for those who persevere.
“I studied in Toulouse Business School, and Tech de Monterrey in Mexico,” shared de Rocquigny. “I joined Air France passenger business in 2000 with a French specific national service agreement, usually reserved for men. I jumped into the program as soon as they opened it for women. It gave me the unique opportunity to get a nice job and work abroad for a French company in Aviation. Thanks to this I spent four years working for Air France in Portugal.”
In 2004, she was introduced to airfreight when she joined the Air France Cargo HQ. Back then, very few women in the industry were given high positions and responsibilities. She was among the chosen few thanks to her technical expertise.
“Air cargo has always been a male environment, and it was even worse 20 years ago. When I joined Air France Cargo in 2004, I was in charge of the e-booking platform implementation. At that time there were not many young managers within cargo and not many females’ managers,” she recalled.
“I believe my expertise in managing technical projects helped me to convince people and to gain some respect from this traditional environment. Some years of experience in Japan and in airfreight, even more challenging situation, also helped to establish my position. I am glad to see, for the last years, many female leaders and CEO in Airlines and for Cargo business,” she added.
New but with huge impact
Now only on its second year, CargoAi is certainly new in the industry yet its impact should not be underestimated. Within a short period of time, the company has managed to forge partnerships with major players with a growing list of clients, convinced that its innovative ideas make a difference in the industry’s newfound importance in today’s global trade.
“We are new in the industry and the impact is already huge. We benefit from the current air cargo boom and it seems very relevant to talk about digitalization, specifically now. It is difficult to get capacity on cargo flights, everyone is trying to get the best process to book efficiently,” explained de Rocquigny.
“Customer services of both airlines and forwarders are overbooked with booking requests, quotes requests and we are coming at the right timing. We propose a solution that provides more visibility for airline capacity, that saves time for both airlines and forwarders and that is easy to implement,” she added.
While it’s been known for curbing a name in real time cargo capacity sales/purchase process, de Rocquigny said their platform offers a wide range of other functionalities.
“CargoAi offers a wide range of functionalities in the cargo capacity sales/purchase process. Forwarders can see all flights for cargo available for a route search. They can request for quotes, see the airlines contract rates and market rates. Our system enables to book and get a confirmation in minutes. We provide the track and trace function and we build dashboards for booking reports,” she said.
And through these extremely busy moments for the industry, the benefits are immediate noted the CargoAI CCO.
“Connecting to CargoAi will save time and money to airlines and forwarders, in addition to bringing more business. Our functionalities are developed to reduce unnecessary manual processes on both sides: managing an incoming booking, requesting a quote, checking for rates, checking for route proposal and availability on flights. All these time-consuming processes are now reduced to instants and seconds. This saved time can be re-allocated to decision-making process, focus on complicated shipments and business development.
“CargoAi allows airlines to reach more potential customers thanks to the route search functionality that displays all airlines schedules. Freight forwarders have now the best tool to choose the flights they need among a comprehensive list of airlines serving the requested route. It is a major change and a tangible benefit,” said de Rocquigny.
Dedicated to airfreight
While their digitalization expertise could be adopted in other industries, de Rocquigny said CargoAi is currently focused on anything but airfreight.
“We actually believe that there is a lot to do in air cargo digitalization and CargoAi already answers to the most important need: the sales/purchase of capacity thanks to its unique cargo capacity marketplace. There are many more processes to digitalize after this shipment booking management and we will certainly look at them in future. Our tech experts have great ambitions for our developments and capable to embrace such projects,” said de Rocquigny.
“We do not plan to expand these services to other industries as we specifically built a team of experts with both technology and airfreight profiles. We believe our experience in air cargo brings a lot. Our solution is specifically made for airfreight, by airfreight experts. Our knowledge in air cargo business is our advantage, we are dedicated to airfreight,” she added.
In today’s fast-moving and interconnected world, de Rocquigny said companies should opt for simple but smart tech solutions that offer the best benefits at optimized budget spend.
“Business and processes are moving so fast that I would recommend to avoid any long term/heavy structured projects. The time taken by these companies to build new systems is too long and not any more affordable in terms of time and budget. The most important is to go for reliable and quick implementation projects. At CargoAi, we talk in weeks of efforts, not in months. Our customers appreciate this,” she said.
CargoAi’s unique features enable an airline for instance to connect within just two to three weeks and have its flight schedules for cargo as quickly as possible.
“Cargo relies on light and flexible technologies. It means we are able to connect to an airline very easily and do that technical work in 2 to 3 weeks,” said de Rocquigny.
“In terms of functionalities, we also have a competitive advantage, our schedule module. CargoAi displays 100% of the flight schedules for cargo for any search for route and this is very powerful. None of our competitors has this module, and we created it! That is the power of having genius of tech on board and experiences airfreight people. We have created what everyone was looking for,” she noted.
IATA: Digitalization crucial to air cargo’s future
While the global aviation industry quickly embraced digitalization, the air cargo industry lagged behind, fully adopting the electronic Air Waybill (e-AWB) as the default contract of carriage for all air cargo shipments only on 1 January 2019, about a decade since the International Air Transport Association (IATA) pushed for its adoption.
This key industry milestone ushered air cargo into a new era where digital processes became the norm eliminating paper-based transactions, thus, improving efficiency and transparency.
The move turned out to be very crucial as the world faced its worst crisis, the Coronavirus pandemic, where air cargo played a very important role in keeping the flow of essential medical supplies and other goods flowing at every continent.
With all airlines grounded, belly-hold capacity sharply declined putting an unprecedented strain on air cargo to deliver essential medical supplies and other vital goods. In the early days of the pandemic, the industry managed to transport 1.5 million metric tons of medical and personal protective equipment across the world through some 46,000 special flights.
Innovative, agile and flexible, the industry managed to reconfigure some passenger planes into freighters to meet the rising demand for more air cargo haul.
With COVID vaccines now available to deal with the pandemic, air cargo’s role became even more important with its new mission of safely transporting the delicate vaccines in all corners of the world.
Throughout this process, air carriers and the supply chain have turned to digitalization and other smart technologies to accomplish what was described as the industry’s “mission of the century.” Specialized containers are used to safely transport the vaccines. Temperature-controlled facilities and coding systems are enhanced, and the list goes on.
And this seems to be just the beginning of the industry’s greater need for smart technologies to keep the world rolling in the new normal.
Silk Way West Airlines announces the inauguration of a new twice-weekly service to and from Tokyo Narita Airport, with flights commencing on the 11 th of February. Based on an agreement signed between Silk Way West Airlines and Nippon Cargo Airlines, both partners will operate a code-share service connecting Baku with Tokyo. Through regular direct flights, cargo will be delivered from Baku’s Heydar Aliyev International Airport to Narita International Airport, the most important international air cargo gateway in Japan.
Silk Way West Airlines, headquartered in Baku at the heart of the Silk Road, was founded in 2012 and is the largest cargo airline in the Caspian Sea region. The airline is rapidly expanding its network from Azerbaijan to major East Asian airports, the Middle East, Central Asia, Europe and the United States.
Silk Way West Airlines has been serving the Japanese air cargo market since 2018, with weekly flights connecting Baku with Osaka Kansai airport. With the launch of new flights to the country, the company will play an increasingly important role in the region’s freight network, constantly improving the quality of air cargo transportation services for both Japanese and international partners.
“We are delighted that the new air bridge will connect our two capital cities directly for the first time in our history, and that the geographic reach of our regular flight network continues to expand and now fully covers North Asia,” said the President of the Silk Way Group, Mr. Zaur Akhundov. “At the same time, we are constantly improving the air transportation infrastructure at Baku airport in order to meet the global demand for cargo services, and I can say with confidence that we are fully ready to handle any cargo, including temperature-sensitive goods,” added Mr. Akhundov.
“The opening of this new route comes further to many years of cooperation with several partners in the region and in this regard, I would like to recognize the valuable contribution of Silk Way Group Executive Advisor Mr. Katsutoshi Tanaka, and Regional Director of Silk Way West Airlines in Japan Mr. Emre Mercan, thanks to whose combined efforts an agreement was signed between Silk Way West Airlines and Nippon Cargo Airlines. The signing of this agreement opens a new page in the history of relations between Silk Way West Airlines and our Japanese partners”, noted Silk Way West Airlines President Mr. Wolfgang Meier.
Medical supplies delivery
The COVID-19 pandemic has seriously impacted activities in many industries, including freight transportation. Under these challenging conditions, the demand for timely and safe cargo flights has increased. The Silk Way Group is committed to supporting the initiatives of the Government of the Republic of Azerbaijan during the pandemic, and continues to provide transportation of essential personal protective equipment and medical supplies.
Silk Way Group aircraft have already completed more than 100 charter flights to deliver medical goods to countries in the CIS, Central and Eastern Europe, Asia and North America since the start of the pandemic.
The Silk Way Group was established in 2006 to manage freight operations from Heydar Aliyev International Airport in Baku.
About Silk Way West
Silk Way West was founded in 2012 and today operates around 250 regular and charter flights monthly to more than 50 destinations in Europe, Asia, North America and South America. The airline’s fleet
consists of 12 Boeing 747-400F and Boeing 747-8F aircraft equipped with the most advanced safety
systems. In 2016, Silk Way West was recognized by Boeing as being the fastest-growing airline in terms
of fleet numbers, geographic reach and cargo volume. Today, the airline ranks third in Europe by these
three criteria.
The Coronavirus pandemic brought the global economy to the brink of collapse, rendered more than half a billion people jobless, tragically killed more than 1.6 million people and infected over 71 million across the world.
The road to recovery remains difficult despite the relatively quick discovery of vaccines to stop the spread of the COVID-19 virus.
And certain industries like air cargo, logistics and their supply-chains are crucial to stop the pandemic by safely transporting the vaccines and keeping the global economy rolling with the seamless flow of medical supplies and other essential goods for personal consumption, exports, re-exports or imports.
In Saudi Arabia, home to approximately over 35 million people, including the estimated 10 million expats it hosts from different countries, Saudi Arabian Logistics Company (SAL), the long-enduring cargo ground-handling and logistics provider of the national carrier since the country’s aviation industry was formally established 75 years ago, was quickly put to the test during the pandemic.
Overcoming the pandemic challenges
Saudi Arabian Logistics Company (SAL) quickly showed its agility, flexibility and resilience to adopt to the new normal despite coming to terms to its new independent status only in January of 2020.
The pandemic has kept the air cargo and logistics industry busier than usual. The major challenge was how to keep their operations running while the whole world was in lockdown, gripped by an invisible virus that knocked down all business activities.
SAL CEO Omar Hariri, concurrently the CEO of Saudia Cargo, explained their cargo operations wasn’t suspended despite the threat of the pandemic.
In fact, the company even resorted to operating passenger planes as freighters to meet the demand in hauling vital medical cargo and supplies. Between March to June alone more than 75,000 tons of cargo were hauled to the Kingdom, carried through 1,500 flights operated during the period.
On the ground, it was SAL that carefully handled all the shipments, safely carrying them to warehouses or cold storage facilities en route to their final destinations, including facilitating their quick Customs clearances.
Shipments from different KSA businesses bound to different countries were also handled by SAL on the ground until they are boarded to the aircraft.
“Our operational team with back-office support rose to the task and made it possible to handle the heavy incoming movement of pharmaceuticals, perishables, foodstuff, PPE and other medical supplies along with e-Commerce shipments,” the SAL CEO proudly shared and noted new safety and health protocols were quickly put in place to protect their team on the ground as well as the shipments they were handling.
He said the heavy influx in the movement of cargo shipments was managed by splitting the load into different stations in the country and supporting customers by way of a strong feeder road connection, as necessary.
“It is important to mention that the support we received from other stakeholders, especially from the Saudi Customs, the General Authority of Civil Aviation (GACA), the Saudi Food and Drug Authority (SFDA) and the Communications and Information Technology Commission (CITC) was tremendous to ensure that we maintain the supply chain of urgent supplies for our people,” said Hariri.
The result: SAL remarkably delivered its tasks through adoption of innovative industry solutions which include having cool dollies for the airside movement; thermal blankets, dry ice capabilities and feeder road services for general and refrigerated shipments along with the launching of new facilities for handling e-Commerce and pharmacy in the main airports of the country that helped maintain the supply chain cycle.
Ready for COVID vaccine distribution
Approximately 19 billion doses of COVID vaccines are needed to immunize up to 70 percent of the world’s 7.8 billion people against the invisible virus.
This delicate historic life-saving mission again requires cooperation from various governments, regulatory agencies and industries like the healthcare, pharmaceuticals, logistics, air cargo and their supply-chains, among others.
The International Air Transport Association (IATA), which represents 290 airlines worldwide, said the industry expects the COVID vaccines to be the largest airlift of a single commodity in its history. To deliver just a single dose of the vaccines to the entire planet would require at least 8,000 B-747 aircraft or jumbo jets.
IATA noted land transport will help, especially in developed economies with local manufacturing capacity. But vaccines cannot be delivered globally without the significant use of air cargo and its supply-chains on the ground like SAL.
“Even if we assume that half the needed vaccines can be transported by land, the air cargo industry will still face its largest single transport challenge ever. In planning their vaccine programs, particularly in the developing world, governments must take very careful consideration of the limited air cargo capacity that is available at the moment. If borders remain closed, travel curtailed, fleets grounded and employees furloughed, the capacity to deliver life-saving vaccines will be very much compromised,” said Alexandre de Juniac, IATA’s Director General and CEO.
Forging alliances with key government agencies in Saudi Arabia along with making careful logistics planning, SAL says it is prepared to take on its new challenge during this pandemic—handle COVID vaccines for distribution in the Kingdom.
SAL had since tied up with the Saudi Food and Drug Authority (SFDA) and Saudi Customs for these delicate cargo’s successful transport from the plane to their final destinations.
“This is the biggest task yet for SAL in its barely a year of operation as an independent entity. SAL has all the necessary mechanisms in place for the safe transport of the vaccines upon delivery at the airport, to the storage facilities, until they reach their final destinations within Saudi Arabia,” said Hariri, emphasizing that the company is looking “at the possibility of transporting shipments from the aircraft directly to dedicated transport vehicles with capability of replenishing dry ice to avoid breaking the cold chain.”
“The whole transportation will be monitored and escorted by trained personnel to ensure that the integrity of the shipment remain intact,” added Hariri who was also recently voted to serve as the Chairman of the Executive Board of SkyTeam Cargo, the biggest global alliance of air cargo carriers.
Hariri said SAL, noting “the considerable growth of cold chain products into the kingdom,” has “decided to invest in state-of-the-art facility that will be three times bigger than its current facility.”
This facility, he said, has a dedicated team responsible for managing the cold chain shipments from arrival until delivery in the declared temperature range.
“The facility is equipped with high-tech temperature and humidity monitoring system that record the temperature every five minutes and alerts in case of deviations,” Hariri explained.
It will also have a sophisticated laboratory for SFDA and the Ministry of Environment, Water and Agriculture (MEWA) to expedite and enhance the clearance process. Likewise, the facility will have two dedicated screening machines for Customs, ensuring a flawless procedure while the tasks are being done in the required temperature range.
“We have invested in doubling our facilities’ capacity for the storage, increasing it to over 7,000 sqm to handle and accommodate cold chain shipments with temperature range varying from 15°C to 25°C, 2°C to 8°C and frozen at -10°C to -20°C with high-tech temperature and humidity monitoring system at the main airports in Jeddah, Riyadh and Dammam,” Hariri said.
New Facilities unveiled
Last month, SAL unveiled its new facilities for pharmaceuticals and perishables located at Riyadh’s Cargo Village inside the King Khalid International Airport.
The launch of the Riyadh cold storage facilities comes at a historic moment that coincides with the much-anticipated global distribution of COVID vaccines.
His Excellency the Saudi Minister of Transport Eng. Saleh bin Nasser Al-Jasser led the inauguration of the facilities with the Ministry assuring the country’s readiness in terms of infrastructure, transportation and people, to handle the historic life-saving mission of distributing the COVID vaccines.
“The new facilities will handle refrigerated and pharmaceutical cargoes and have an area of 5,000 square meters and four main sections: Delivery, Inspection, Temperature-Controlled Storage and Cargo Sorting. They can handle 100 tons a day and have 13 refrigerated storages for perishables and pharmaceutical cargoes with different temperatures. These facilities meet modern global standards and also the needs of suppliers,” Hariri explained.
The new facilities have four docks for loading refrigerated containers. Its warehouses have different temperatures ranging from -20°C to 25°C to suit the nature and type of cargo to be stored.
The opening of the facilities ushers in a new and advanced phase for handling sensitive cargoes including foodstuffs that require special care. Within the facilities are divisions run by SFDA and the Saudi Customs to inspect and expedite the cargo handling process to avoid an unbreakable cool chain.
Combined, the new pharmaceuticals and perishable facilities can adequately handle up to 365,000 tons of cargo a year.
They also have a 650 sqm temperature control breakdown area as well as space for shipping refrigerated containers enough for 20 active containers. It is also equipped with a thermal isolation area.
Beyond Saudi’s capital Riyadh, SAL also has facilities in Dammam, the city where Saudi Aramco is based and Jeddah, the country’s business capital. All three facilities are fit for high volumes of general cargo and temperature-sensitive shipments.
Building a robust workforce
Continuing to build on the strength of its skilled workforce, SAL regularly conducts and facilitates training for its people on the ground like the ramp service agents and ground handlers as well as those involved in other operations—sales, accounting, warehouse & inventory, compliance and safety, administration, customer service, among others.
“We provide the required training in the hands of specialized, qualified and certified trainers for ground operations that is appropriate for every job and task performed by ground handling personnel,” said Hariri.
Training solutions were done according to appropriate methods, whether through virtual classes or training rooms and on-the-job training.
This, alongside a specialized department for writing, developing and updating training curricula under the supervision of specialists to keep the pace with developments in the field of ground-handling, according to the requirements of GACA and IATA.
The courses are segregated into two main courses – mandatory, which covers safety management systems, aviation security, health and safety as well as fire prevention and emergency response procedures among others; and functional, which, among others, include air cargo principles, handling of and regulating dangerous goods, transporting live animals, and handling special cargoes and sensitive pharmaceuticals.
Investing on new technologies & the future
Recognizing the importance of digitalization in today’s digital world, SAL continues to upgrade and invest on tech-driven systems, equipment and facilities that will enhance and make its services more efficient.
It is also actively digitalizing and automating its services, including availing different means of data capturing to improve productivity and on-time performance-based on real time data visibility and transparency.
Likewise, it is following an E-business approach to integrate with all stakeholders and go paperless with all its internal and external transactions. It has also invested on cybersecurity technologies to assure a safe and secure workplace for all stakeholders.
“Businesswise—SAL is focusing on customer centricity by investing in latest technologies to enhance and improve customers relation. In addition, SAL invested in its infrastructure to automate and digitize its services and avail different means of data capturing in order to improve productivity and on time performance based real time data visibility and transparency,” the SAL CEO explained.
“Environmentally—SAL is following an E-business approach to integrate with all stakeholders and go paperless with all its internal and external transactions. E-freight, E-AWB, E-CSD and E-DG are some of the prime electronic documents SAL is steadily progressing to fully enable,” he added.
Under Saudi Vision 2030, Saudi is reinventing its oil-based economy into diversified markets, mainly consisting of tourism, healthcare, transportation, education, among other industries.
Part of this long-term goal is to develop Saudi as a global logistics hub which gave rise to the Saudi Logistics Hub government initiative seeking to position the country as a strategic gateway at the crossroads of three continents—Asia, Africa and Europe.
As the biggest economy in the Middle East, Saudi commands more than 50% of the logistics market share in the GCC region. In 2019, the country saw 47% increase in the number of new foreign transport and logistics companies, according to the Saudi Arabian General Investment Authority.
This year, Saudi was ranked as having one of the world’s fastest-growing logistics sector by the World Bank Group’s Doing Business 2020 report, jumping 30 positions to 62nd place.
“The logistics sector is undoubtedly a vital component in the country’s quest to diversify its economy in a changing world. We have put in place all the necessary measures to make sure SAL contributes to the seamless flow of goods that come in and out of Saudi’s main entry points to facilitate a healthy global trade for many years to come,” concluded Hariri.
According to the UNESCO Institute for Statistics, global spending on research & development (R&D) has reached a record high of nearly $1.7 trillion. of the figure, just 10 countries account for 80% of the spending, with China and the United States dominating the share, focused mainly on science and technology.
The Coronavirus pandemic brought about enormous unprecedented challenges and uncertainties with profound impact on people’s lives, industries and economies across the world that would take years, if not decades, to recover from.
Buried in mounting debts and faced with tight resources amid a global meltdown in economic activities, governments and various industries have turned their sights on investing more in new technologies to push for recovery.
According to the UNESCO Institute for Statistics, global spending on research & development (R&D) has reached a record high of nearly $1.7 trillion. Of the figure, just 10 countries account for 80% of the spending, with China and the United States dominating the share, focused mainly on science and technology.
The US continues to lead on tech investment raising as much as $148.75 billion, nearly 50 percent of the global total and more than double that of China, over the last four years, according to Tech Nation, a UK network for tech entrepreneurs.
Globally, e-Commerce giant Amazon, which has expanded its business clout to logistics and air freight, is the top private spender on R&D at $22.6 billion in 2018. Alphabet, Volkswagen, Samsung and Intel rounded up the top 5.
China, however, is fast catching up, reportedly spending as much as $322 billion on R&D for science and technology in 2019. The country is aggressively competing with the US and others in selling their tech products, including building and deploying the 5G or the fifth generation of wireless technology, which would revolutionize how we communicate and do business.
Accelerating digitalization
The new normal requires people to observe social distancing in public spaces, and contactless transactions. This means accelerating digitalization and the use of new technologies in various industries to protect people from getting infected with the virus.
Deloitte, one of the biggest auditing, financial and accounting firms in the world, said the tech industry has helped many people and businesses stay connected during the pandemic and this would have a long-term impact on our future and the way industries do business.
Deloitte forecasts the global economic recovery to begin in late 2021 with uncertainties still looming in the horizon.
“The virus follows a wave pattern, abating and then peaking again in multiple global geographies. Economic recovery begins late 2021. Recovery slow in early 2022 and speeds up by second half of 2022. Chinese economy rebounds slowly. Deep and prolonged recession in the West affects supply chains and consumer demand. Fiscal stimulus limits business failures, but does not boost spending,” Deloitte said.
Kevin Smith, Head of KPMG Private Enterprise in EMA, said we’re now seeing the acceleration on digital transformation, especially the use of artificial intelligence (AI) and machine learning, due to the pandemic.
“Despite the challenges that the entire world has faced over the past few months, one of the positive outcomes of COVID-19 that people were talking about was the acceleration of digital transformation, especially artificial intelligence and machine learning …. these technologies will, in fact, be instrumental in collecting and analyzing the enormous sets of data that will be vital to our post COVID-19 recovery,” Smith said in a recent industry webcast which KPMG, a global network of independent member firms offering audit, tax and advisory services, organized.
Aviation still in slump as cargo rises
Aviation remains in a “coma” following the abrupt cessation of travel worldwide to prevent the spread of COVID-19. No one can say with certainly when this once vibrant industry will return to normal with the vast majority of people still reluctant to fly for economic and health reasons.
The International Air Transport Association (IATA) has since called on governments to work together to urgently find ways to re-establish global connectivity by re-opening borders and keeping relief measures to sustain airlines during the COVID-19 crisis.
“Many airlines will not have the financial means to survive an indefinite shutdown that, for many, already exceeds a half-year. In these extraordinary times, governments will need to continue with financial and other relief measures to the greatest extent possible. It’s a solid investment in the recovery because each airline job saved supports 24 in the broader economy. And a functioning airline industry will be a critical enabler for economies to regain their full power,” said Alexandre de Juniac, IATA’s Director General and CEO.
In July, global passenger traffic fell by nearly 80 percent compared to July 2019 levels despite some airports and airlines resuming operations.
The air cargo industry, on the other hand, instantly became the star of the show hauling across continents vital medical supplies and equipment, including urgently needed necessities such as food and medicines, in huge quantities.
Demand for more freighters prompted many airlines to convert passenger aircraft to so-called all-cargo flights to increase capacity. The loss of belly-hold capacity from commercial flights, however, remains a big blow to the air freight industry.
IATA said cargo volumes remain low compared to the pre-Covid era but not as much as that of passenger traffic. With global economic activities slowly picking up based on improving manufacturing output and new export orders data, air freight is up for more business.
“Economic indicators are improving, but we have not yet seen that fully reflected in growing air cargo shipments. That said, air cargo is much stronger than the passenger side of the business. And one of our biggest challenges remains accommodating demand with severely reduced capacity. If borders remain closed, travel curtailed and passenger fleets grounded, the ability of air cargo to keep the global economy moving will be challenged,” said de Juniac.
The rise of AI, APIs and other new technologies
Long before COVID-19 struck, the air cargo industry took on steps to transition from outdated and complicated legacy systems to the more efficient tech-driven and paperless systems.
The pandemic though forced the industry to accelerate streamlining its operations, reduce costs and optimize its efficiency by using more customized interfaces used for networking planning, flight operations, revenue accounting, and other processes.
Major air cargo carriers have since switched to tech-driven systems and beefed up investment on new technologies which are far more efficient that the traditional way apart from improving transparency in the supply-chain operations.
These include using AI, APIs, GPS tracking solutions and other new technologies used in promoting their services, providing customer service, tracking, booking shipments online or making payments.
The use of cloud systems is also in high demand this year and so are videoconferencing and remote collaboration to keep staff productive and business as well despite the lockdowns.
According to IATA, the e-AWB is now used for 2 out of 3 shipments, signaling that the industry is ready to take on digitalization to the next level and go beyond EDI and messaging technologies.
Currently, IATA said the e-AWB network covers 63% of worldwide trade (the e-AWB network corresponds to locations where the legal framework has been created to allow an electronic contract of carriage) and their goal is to have a 100% penetration by 2022.
China’s unmanned cargo planes
With more than 1.4 billion people, China has the world’s biggest domestic market and consumer demands are increasing. Outside of China, the Chinese population is also rising in different parts of the world.
Following the pandemic, China had pledged to keep strengthening its domestic market while luring more foreign investors. The seamless movement of goods is an important aspect to the success of this initiative and the country has vowed to improve its air, rail, land and sea transport systems.
Last year, China’s biggest air cargo company, SF Express, fourth largest globally after FedEx, UPS and DHL, signed a memorandum of understanding with Searidge Technologies, among other firms, to set up digital remote air traffic control towers in China.
Pat Urbanek, an IT expert and executive at the Canadian firm Searidge Technologies which specializes on remote digital tower solutions with presence in 25 countries, said their digital remote tower project in China is in line with SF’s plan to use plane-size cargo drones capable of carrying more than 1.5 tons, mainly parcels for now.
“SF Express is the fourth largest cargo and freight company in the world behind FedEx, UPS and DHL. Their plan is to be able to provide parcel delivery within 36 hours all over China,” Urbanek told Air Cargo Update.
In August, SF successfully operated its unmanned cargo plane, the FH-98, cruising at fast speed. Its success ushers the beginning of a new era in China whereby autonomous cargo planes will be used to fly domestic goods.
SF’s subsidiary, Feng Bird Airlines, will operate the large-scale drones for cargo which is mainly targeting to serve remote areas across China.
Urbanek said the future looks bright with technology working to enhance the old systems for the greater good of humanity.
Technology has made the world smaller and faster.Real time communication with people from all over the world at different time zones through phones and gadgets
