Jim W. Butler has been with American Airlines for more than 21 years and has held numerous high positions during his career, including as cargo president.
But this year is particularly important after he was named in January as senior vice president-international cargo, in-charge of strategic initiatives at American’s 114 stations in Asia, the Caribbean, Latin America, Europe and the Pacific.
He is also the man steering the wheel for the airline’s cargo business, including its operations, marketing, sales and overall strategy.
A graduate of Cornell University with Master in Business Administration from the Kellogg School of Management at Northwestern University, Butler was one of six top key people at the company who was tapped for the core integration leadership team responsible for the merger of American Airlines and US Airways in 2013.
No surprise at all as Butler is known in the company for his integrity, dedication and expertise in finance with extensive background in sales, marketing, pricing and operations.
He has held positions that were based domestically as well as in London and Buenos Aires in revenue management for American and Aerolineas Argentinas, interactive marketing, global sales planning and analysis as well as finance for Europe and Asia.
He also served as managing director of Commercial Planning and Performance, where he had responsibility for American’s mainline and regional fleet, network profitability analysis, large-scale strategic project oversight and commercial budgets.
Butler’s duties and responsibilities seem overwhelming but this father of two from Lewisville, Texas, balances everything with his other passions—traveling, flying and skiing—whenever there’s opportunity.
“Naturally, we like to travel,” Butler was quoted as saying in the Miami Herald where he discussed at length the state’s importance in AA’s cargo business with Miami the gateway to 100 million pounds plus of weekly cargo lift to cities in the United States, Europe, Asia, Canada, Mexico, the Caribbean and Latin America.
Butler apparently learned how to fly as a teenager and is a licensed private pilot.
The airline executive whose mother is from Peru also speaks fluent Spanish.
Described as affable, interested, approachable and enthusiastic, Butler is highly regarded in the industry, for a number of good reasons.
DUBAI: The United Arab Emirates along with Singapore, the United Kingdom, New Zealand, Estonia,Hong Kong and Japan have been identified as the world’s digitalietes with their economies characterized with high levels of digital development and evolution.The Fletcher School at Tufts University, in partnership with Master card, a leading technology company in the global payments industry, made the assertion of their findings in the recently released Digital Evolution Index 2017.The comprehensive research tracks the progress that countries have made in developing their digital economies and integrating connectivity into the lives of billions.With nearly half of the world’s population online, the research maps the development of 60 countries,demonstrating their competitiveness and market potential for further digital economic growth.The index measures four key drivers and 170 unique indicators to chart each country’s respective course,including supply (or internet access and infrastructure), consumer demand for digital technologies, institutional environment (government policies/laws and resources) and innovation (investments into R&D and digital start-ups etc.).Combining the pace and state of digital advancement, the research puts the UAE in the ‘Stand Out’ category with the state demonstrating high levels o f digital development while continuing to lead in innovation and new growth.
All trucks in the platoon are connected via electronic car-to-car communication, thus, cutting CO2 emissions and savings costs while ensuring the safety of the drivers
Defined as a vehicle system for road traffic in which at least two trucks on the freeway are networked by a technical system, allowing them to drive one after the other at a very close distance, platooning is envisioned to soon be the norm in Germany.
Convinced that the electronic coupling of the vehicles will ensure safe travel in traffic, cut CO2 emissions and costs, Germany’s Federal Ministry of Transport and Digital Infrastructure has offered 2 million Euros to experiment on the project.
DB Schenker, MAN, and Hochschule Fresenius are receiving the funding from the Federal Ministry for their joint development of networked truck convoys. The project began in June and will last through January 2019.
The proponents say the partners will test truck convoys in everyday operation at the digital test site, the A9 freeway, for several months to analyze their suitability for practical application and system safety in real traffic scenarios as well as within the logistics processes of DB Schenker. This phase is also aimed at investigating the potential effects of the new technology on the trick driver profession.
“Automated and networked driving will soon be a reality. The platooning project will bring the technology from the lab to the roads. High-tech trucks maintain safe distances and comm-unicate with one another. Traffic runs more smoothly and safely, and road capacity and cabin comfort go up. This relieves stress on drivers and the environment,” said Alexander Dobrindt, Federal Minister of Transport and Digital Infrastructure.
“With this project, DB is expanding its further expertise as a modern mobility and logistics provider. The Ministry is bringing innovative research projects focused on automated and networked driving to the road and is providing funding in the sum of 100 million euros. With the development and testing of networked trucks, we are beginning yet another project on our digital test field, the A9 freeway. The goal of our funding is to make Germany the leading market for automated and networked driving,” he added.
Jochen Thewes, CEO of Schenker AG: “We are thrilled that the Ministry has decided to provide us with funding. DB Schenker is pioneering the way, together with its project partners, to the introduction of platoon technology for trucks in the German market. With early and thorough testing in real road traffic scenarios, we are, yet again, fortifying our role as a leader in digitalization. This project demon-strates our high standards and ambition to be the driver of digital business models for our customers in the transport and logistics sector.”
The total funding amount will be divided among the project partners in accordance with their respective budget needs. DB Schenker will coordinate the entire project.
Starting in early 2018, the first test runs will take place on the digital test field, the A9 freeway, between the DB Schenker locations in Munich and Nuremberg. MAN will construct modern test vehicles for performing the test runs.
Joachim Drees, Chief Executive Officer of MAN Truck & Bus and MAN SE: “We are very pleased to receive funding for this important project which enables MAN, together with our project partners, to test the truck platooning project for the first time over several months of practical application in real everyday logistics scenarios with professional drivers.”
Hochschule Fresenius is researching the effects of the new technology on the drivers in the platoon with a focus on the neurophysiological and psychosocial impact. “From the very beginning, it is important consider those who will be affected by the developments”, says Professor Dr. Christian T. Haas, Head of the Institute for Complex Health Research at Hochschule Fresenius. “Our knowledge gained by analyzing the effects of the human-machine interface flow directly back into how the technology is developed and the working conditions are designed.”
At the start, the trucks will run unloaded while the driving conditions in everyday traffic are analyzed and the drivers are trained. Over the course of 2018, there should be up to three trips per day with real loads.
ULDs are certified and tested to maximum load limits, the freight is restrained with a net, and/or straps and securely locked in place on the aircraft, so it cannot move or shift.
Using unit load devices (ULDs), commonly divided into pallets and containers, is a normal scenario in the cargo export industry for companies handling goods transported to various places.
It’s the most effective way to handle and store materials and make loading and unloading an easy task, ensuring that your products arrive safely to their destination.
The unit load device market is projected to grow from $1.64 billion in 2016 to $2.02 billion by 2021, at 4.28% CAGR during the forecast period, according to markets and markets.
Air Cargo Update met with cargo industry experts from Jettainer, Emirates, Etihad Airways and Cargolux to go in depth as to how ULDs help in storing, managing and delivering cargo in one go to its final destination.
David Dubois, Cargolux’s Head of Global ULD Services, notes, “It makes things easier. A pallet plus net helps secure several smaller pieces of cargo—ready to load onto an aircraft in a safe and efficient manner. Offsize cargo that is larger than the pallet’s dimension can be loaded on a combination of pallets rather than a container.”
“Pallets help to organize cargo for air transport. By pre-arranging the cargo items on pallets load control, the weight is equally spread within the plane, the conture/shape is strictly adhered to, so the loading process is timely and efficient, all items are secured according to official rules and regulations (one needs to be certified to ‘built’ a pallet, meaning to secure items on a pallet and cargo can be placed on pallets prior to the flight, saving time,” notes Jettainer’s marketing and PR head Martin Kraemer.
ULDs are used to load freight and mail on wide-body aircraft. It allows a large quantity of cargo to be bundled into a single unit. It saves ground time and effort which helps to reduce the turnaround time of flights. Each ULD has a tag with details of cargo loaded on it and the contents, which are listed in the cargo manifest for the flight, helps to track the cargo.
David Kerr, Senior Vice President, Etihad Airways, said, “Pallets help to organize cargo for air transport. Palletised products can be moved more quickly than manually handling individual cartons. Palletised products can be moved more efficiently and stored more efficiently in warehouses. Pallets are typically easier to handle with material handling equipment than other styles of unit load device. Cargo can be placed on pallets prior to the flight, saving time compared to bulk loading.”
The selection of ULD for loading is based on the specification of cargo. There are different ULDs like VRA/VZA for cars, HMA for horses, RKN for temperature controlled cargo such as pharma.
“Yes, there are several types of ULDs required for many different types of cargo, i.e. TSC pharma in active container, horse stall, heavy cargo on a heavy duty pallet. Special container hold garments on hangers, lockable doors container are used for valuables or carracks. As a specialized cargo airline, Cargolux offers the right ULDs for all customer requirements,”says Cargolux’s David Dubois.
Emirates SkyCargo has a fleet of cool dollies that are used to transport temperature sensitive pharmaceutical products from ramp to temperature controlled storage area and vice versa.
It is also used as a temporary temperature controlled storage unit at ramp for quick transfer of pharma cargo. The cool dolly can support temperature ranges between -20C and +20C.
Emirates SkyCargo also has maindeck cool dollies that can transport temperature sensitive cargo to and from the storage area to the aircraft for quick loading and unloading.
“Our product development team also invented a new cool container which we named ‘White Container’. It is coated on the inside with thermal Insulators to counteract high temperatures in Dubai and help preserve temperature-sensitive cargo, including fruits and vegetables as well as pharmaceuticals.
“The latest innovative product in our suite of transportation solutions for perishables, the Emirates SkyFresh Ventilated Cool Dolly not only maintains a constant temperature while transporting cargo, but also has a ventilation system that allows it to bring in fresh air from outside. The fresh air is then cleaned using custom built filters, cooled and then circulated inside the refrigerated interior where the temperature sensitive perishable cargo is stored. This is also available in a maindeck version,” says an Emirates spokesperson who declined to be named.
Safe and Secure
ULDs are certified and tested to maximum load limits, the freight is restrained with a net, and/or straps and securely locked in place on the aircraft, so it cannot move or shift. Containers have solid lockable doors.
“Containers protect cargo from all types of weather and give better protection against the damage of cargo. Cargo that cannot fit into containers are loaded onto pallets and secured with straps and nets to fasten the load, ensuring the cargo cannot shift during the flight. The ULD itself is locked on the ground of the aircraft with fasteners so it will be physically linked to the plane and not shift during the flight,” said, David Kerr of Etihad Airways.
“As cargo is stored in them/on them according to official rules and nets/ straps are used to fasten the load, it is thus made sure no cargo can shift during the flight.
The ULD itself is locked on the ground of the planes cargo or main deck with fasteners, so the ULD will be physically linked to the plane and can not shift during the flight,” said Jettainer’s Martin Kraemer.
Quick cargo movement
ULDs are pre-loaded, so they are ready anytime. They also hold a number of pieces of cargo that can all be handled in one go. They are crucial in transporting air cargo safely, quickly and cost-effectively.
They enable individual pieces of cargo, luggage or mail to be assembled into a single unit, which can then be loaded on and off an aircraft with speed.
To prevent the ULDs moving around during flight and potentially damaging the aircraft, the plane has loading and restraint systems. These interface directly with a ULD, locking it into place so it becomes part of the aircraft.
On a PMC (96x125in) – the most common ULD – the maximum weight is 6.8T, on a heavy duty device, i.e. 20ft pallets (96×238.5in), cargo up to 29T can be loaded with restrainers on the aircraft and depending on the position in the aircraft .A main deck container can be loaded just like a PMC, 6.8T.
Pallets and containers can be loaded up to 3m high with a contour that fits the aircraft, according to Cargolux
At times pallets are more preferred than containers as they are cheaper compared to containers for cargo transportation. Pallets can accommodate cargo that is difficult to fit into containers (e.g. oversized cargo). They are stackable and therefore efficient and easy to store empty and return by aircraft.
On the logistic side, pallets are easier to move and re-position than containers.
However, according to Jettainer there are cargo items that perfectly fit on pallets, and others better in containers. Baggage for example always flies containerized.
It is the nature of the goods and/or the preference of the airline what ULD they use. E.g. it is more difficult to steal from a container than form a pallet.
“ULDs become part of the aircraft the moment they are locked on the aircraft floor. Therefore, they always must be in excellent serviceable condition, handled with care and should be ‘airworthy’, and there are strict rules regarding airworthiness.
“At Etihad Cargo, we provide ‘Serviceability training’ to all staff who handle the ULDs. There is pocket guide called ‘Damage Limitation Card’ provided for their easy reference,” says Kerr.
“We have training in place for GHAs and will introduce it for forwarders handling Cargolux ULDs. ULD requires special and careful handling in order to keep them serviceable and prevent damage to the cargo. Our specialists use advanced procedures during handling and pallets and containers are regularly maintained to keep them in top shape,” according to Cargolux’s spokesperson.
Jettainer has a program called ULD-X-perts, teaching handling staff of the right way to treat ULDs. This is done in order to lower repair incidents.
Pallets are to be covered with polythene covers to protect from weather conditions like rain, dust etc. They are to be stored in appropriate locations depending on the conditions and type of cargo loaded on the pallets.
ULDs need to carry the owner’s name in order to know where to bring them or who to contact in case of abundance units.
Mandatory markings on ULDs include IATA code and TSO/ETSO plate, manufacturer’s data plate, ODLN (operational damage limitation notice- used to check ULD for serviceability). A ULD tag is attached with the AWB number that is unique to that ULD and allows to track the cargo linked to that ULD.
ULDs must be moved on dollies only – from the time they are loaded until they are secured on a position on the aircraft.
There are also constant develo-pments and advances in technology as well, testing is continuous (RFID, GPS) but generally, controlling is done with manual input of ULD messages processed by an IT system.
Also it is IMPORTANT to note that it is not the decision to use or not use a pallet. It is GIVEN by the type of airplane that the needed ULDs (containers or pallets. If a plane is equipped with a roller bed, freight HAS TO be loaded on ULDs only. Most planes (belly and freighter) are using ULDs, according to pallets expert Jettainer.
Jettainer always labels ULDs in addition to the Jettainer sign with an airline denominator and the airline code of its customer. This is as Jettainer runs INDIVIDUAL ULD fleets for each single customer.
Jettainer adds a ULD number for individual tracking, tracing and steering of each ULD. This number is unique making it possible to steer any single ULD within our network.
There is as well a QR code on the ULD for electronic recognition. This, together with the unique number and the airline code & Logo is ALL NOT MANDATORY.
Under Goods and Services Tax (GST), the rates are going to be 0%, 5%, 12% and 18%. GST is expected to have a sweeping impact on many sectors, most importantly the logistics sector, which has been constrained by infra-structure & taxation issues.
Touted by the National Democratic Alliance (NDA) government as India’s biggest tax reform in 70 years since independence, the Goods and Services Tax (GST) was launched on July 1, 2017.
This was first proposed in 2000 but it was only the NDA government, under Prime Minister Narendra Modi’s leadership, that idea came into frusion.
GST is an indirect tax applicable throughout India, replacing multiple cascading taxes levied by the Central & State governments. It has been advertised as ‘One Nation, One Tax’.
Under GST, goods and services are taxed at the following rates – 0%, 5%, 12% and 18%. GST is expected to have a sweeping impact on many sectors, most importantly the logistics sector, which has been constrained by infrastructure and taxation issues.
GST is expected to optimize the production and distribution of goods and services and along with it, it will help speed up cargo movement across the country and beyond.
Indian check-posts and customs have been notorious for collection of toll and ‘bribe’, and of course unnecessary stoppage of vehicles.
A 2015 report by the Transport Corporation of India (TCI) and the Indian Institute of Management – Calcutta said that the stoppage expense (average expense incurred due to the stops along the way such as check-posts and customs) per ton-km had increased from Rs. 0.16 per ton-km to Rs. 0.28, a 75 percent increase between 2011-12 and 2014-15. The imposition of duties by State Governments at checkpoints was one of the reasons for the rise in logistics cost and this is expected to come down drastically under GST regime.
Consolidation of warehouses
Prior to GST, goods incurred 2 percent central sales tax (CST) when they are manufactured in one state and sold in another.
To avoid this, industries transferred the manufactured goods to warehouses in the State from where the sale of goods takes place. This helped them avoid CST while simultaneously availing the input credit that could be obtained through value-added tax.
With a fixed GST rate, the warehouses are expected to be consolidated into bigger players.
Manufacturing companies that own many small warehouses and third party logistics providers such as TCI, VRL Logistics and GATI among others are likely to move towards this hub-and-spoke service delivery model wherein distribution takes place from a large centralized warehouse to surrounding States.
TCI is setting up GST-ready warehouses across four locations – National Capital Region – 2.5 lakh sq.ft; Nagpur 1.65 lakh sq.ft; Hyderabad – one lakh sq.ft; and Chennai – 45,000 sq. ft.
The TCI-IIM study had pointed out that trucks in India currently travel an average of about 280 km per day in comparison to those in the US which travel 800 km per day.
With GST, the average per day travel is likely to go up by an additional 164 km per day, almost 60 per cent increase, according to a report on revenue neutral rate headed by India’s Chief Economic Advisor Arvind Subramanian.
Though the average fuel mileage has improved due to better roads and vehicles over the last few years, the nation still incurs a cost of close to $6.6 billion annually due to transportation delays.
Transport costs likely to decrease
It is anticipated that with GST in place and reduced border checks and paper work the transportation cost is likely to come down by 20 to 30 percent in the medium term, which the logistics sector is looking forward to.
This will have a cascading effect on containerization too. With larger storage hubs, truck operators will transport higher volumes (full truck loads) thus optimising operations.
Organized big players should be able to take advantage of these changes. The increased speed of transportation will be a boon to the cold supply chain industry.
In a bid to ensure the smooth implementation of GST, the Central Board of Excise and Customs (CBEC) constituted ‘GST Working Groups’ to interact with select industry experts to address their concerns.
The Additional Director General, Directorate of Revenue Intelligence, J.M Kennedy, who is part of the Working Group, Transport & Logistics GST had an interactive meeting in Chennai with the logistics industry leaders from the Federation of Freight Forwarders Associations in India (FFFAI), the Air Cargo Agents Association of India (ACAAI), the Association of Multimodal Transport Operators of India (AMTOI) and the Consolidators Association of India (CAI).
GST issues ‘red-flagged’
The associations raised many concerns as there are going to be teething problems. They stated that certain provisions in the GST needed a relook and they included freight forwarding, customs broking, logistics services and manufacturing and exports industry in the country.
The joint delegation emphasized on exemption from new tax burden to be levied by GST structure on freight forwarding, customs broking and logistics industry as a whole, which hitherto have been exempted to make Indian manufacturing and export less expensive and competitive in the international market.
Presently, there is no ‘service tax’, based on Rule 10 of the ‘Place of Provision of Service Rules 2012’, in the air and sea cargo freight forwarding segment. This means that in respect of taxation on transportation of goods (other than mail or courier) criteria should be the ‘Place of Destination of Goods’.
In the freight forwarding segment, including air and sea cargo pertaining to export of goods from India, the place of destination being outside India and, as a result, service tax is not payable.
This aspect was also confirmed by CBEC by a circular issued on August 12, 2016. However, the proposed GST law plans levy of GST on international transportation as well as freight forwarding which is in variance with the GST Provisions in other countries.
In addition, in the international air segment all airlines have registration in India and when a freight forwarder purchases an air freight slot/space from the airline, the tax would be applicable as per GST rate on services. Currently, there is no tax imposed on freight forwarders for the same.
The Associations observed that Indian exports would become ‘uncompetitive’ if the GST on freight forwarders is passed on to exporters. Similarly, levy of GST on import cargo would also result in double taxation (since on the entire freight, customs duties are being levied under Section 14 of the Customs Act) affecting re-export or Ex-Im trade.
The Association representatives also raised a red flag over Registration and Data/ Return filing. The GST law indicates that SGST registration could be required in every state where there is a supply of goods or services or both.
Currently, for service providers, the law provides for a centralised registration and compliance. The rule exists in view of the fact that logistics related services especially in ex-im trade, are different from the traditional manufacturing sector. It has also been noted that under the GST regime supplier will have to file data online on 10th and 15th of every month and a monthly return on 20th apart from an annual return.
This would mean 37 filings per state if state-wise registration is implemented. In addition, if TDS and ISD is applicable there would be 61 filings in a year per state, which they stated would add to a lot of unnecessary paperwork and harassment.
Zero rated tax sought
The Associations urged at the meeting that international transportation of goods by all modes including freight forwarding should be zero rated; ancillary services related to international transportation of goods like customs clearances, warehousing, storage, cargo handling, packing, unitisation, port, airport, terminal etc should be zero rated or exempted; Concept of centralised PAN based registration must be retained whereby service providers in the international transport segment can have a centralised registration and discharge applicable taxes through GST portal; The location of service provider should be the centralised registration address in the context of ‘Place of Supply’ provisions; and a single periodic return for the entire country should be implemented.
It is believed that as GST stabilizes, it will yield several productive and positive outcomes, starting with setting up of huge warehousing hubs coupled with an enhanced transportations and logistics services across the nation.
Besides, there would be business opportunities in offering a variety of value-added services such as bar coding, reverse logistics, packaging etc., to provide international quality services to the consumers.
India is perceived to be moving on the right track and in an ‘express’ mode, thanks to the government’s proactive policies.
The baggage handling system market is estimated to be valued at US$6.45 billion in 2015, and is projected to reach US$9.36 billion by 2020, at a CAGR of 7.72% during the forecast period from 2015-2020, according to markets and markets projection.
The hot summer months in the Middle East are also the busiest months for us to travel across the globe. Proper handling of our baggage makes our travels happy, satisfactory and at ease.
A baggage handling system is an integral part of any commercial flight airport and the operational efficiency of an airport is largely dependent on this system.
A smartly designed baggage handling system helps in improving passenger convenience while reducing aircraft turnaround time. The system includes conveyors, identification devices, screening devices, sortation devices and destination-coded vehicles.
The baggage handling system market is estimated to be valued at US$6.45 billion in 2015, and is projected to reach US$9.36 billion by 2020, at a CAGR of 7.72% during the forecast period from 2015-2020, according to markets and markets projection.
We discussed with baggage handling experts John Mitchell – Senior Manager Baggage and Cargo logistics, dnata and with Klaus Schäfer, Managing Director, BEUMER Group A/S how a baggage handling system works.
Reliability, speed and efficiency are paramount for a modern baggage handling system. As an integral part of the passenger experience, a seamless, end-to-end process is crucial for ensuring that passengers continue to enjoy using the airport and report the highest satisfaction ratings.
There are different types of baggage handling system (BHS), one example is DXB: this is a tote system: A bag is injected to the BHS from either check-in or a transfer laterals, the identified by an automatic tag reader (ATR) which reads baggage tag bar code representing the standard IATA 10 digit code.
This code is compared to the BHS database and assigned to a tote. Tote is then assigned to an output destination (carousel) if a near time departure or and early bag store (EBS) if far time. When it is time to load the bag is tipped out of the tote and fed to the carousel, according to dnata.
Beumer Group’s tote-based baggage handling system the CrisBag® system’s Crisplant technology platform, fulfills all of these core criteria and adds 100% tracking and traceability throughout the entire baggage handling process.
Klaus Schäfer notes, “With the CrisBag® system, each bag is placed in an individual tote after check-in and the bag tag’s IATA barcode is linked to the tote’s embedded RF tag. The bag and tote are never separated and RF readers integrated into the track at critical points continually monitor and verify the position of the bag within the system”.
Beumer Group’s another aspect of a typical baggage handling system is the Early Baggage Storage (EBS).
The EBS technology can allow baggage to be checked-in hours before the flight time, Gatwick, for example, offers check-in 18 hours before departure. This not only provides more flexibility for passengers, but also benefits the airport by helping to manage peak volumes and reduce labour requirements.
As a next-generation, dynamic EBS, BEUMER Group’s CrisStore® system can enable more flexible staffing patterns at the loading gate and streamline the loading process through batch building of baggage.
Based on a modular rack-based storage system, CrisStore® is integrated into the main BHS to maintain 100% traceability and can be implemented in minimal footprint whist providing for easy future expansion.
Currently, baggage handling can be a very fragmented process: check-in is handled by the airline; make-up by a ground-handler; arrivals by a different ground-handler; and reclaim carousels by the airport or airline. With the implementation of IATA 753 Resolution in 2018, IATA airlines will bear the ultimate responsibility for ensuring that each bag is delivered to the destination and passenger on arrival.
“Security is one area, which has previously presented issues of both traceability and delays as bags are removed from the sorting system for more intense scrutiny. As a tote-based baggage-handling system Crisbag® helps to overcome these issues by ensuring that each bag stays within its individual tote during the screening process.
“This enables each bag to be fully tracked and traceable throughout the screening process and allows the airport to benefit from high load-sharing of Hold Baggage Screening machines and fast transport between screening areas. CrisBag® therefore makes it possible for airports to meet the tightest security regulations with the optimum number of screening machines and without creating unnecessary bottle-necks and delays,” notes Schäfer.
John Mitchell of Dnata says, “At DXB we receive Baggage Process Messages (BPM’s) created by various processing systems. These represent the touch points a bag passes – like the ATR in BHS. We also scan containers and bags with PDA’s at points outside the BHS”
Today’s demand for high capacity and high security can only be achieved with individual traceability and control of each item of baggage throughout the Baggage Handling System (BHS).
A fully integrated end-to-end baggage handling system must integrate technology for security screening, storage, sortation and transportation from check-in to loading, as well as for the handling of arrival baggage.
Klaus said, “BEUMER Group’s Airport Software Suite ensures the required visibility and traceability of baggage at any stage in the process. In addition, Residential Service Contracts provide 24/7 system optimisation and effective maintenance programs, which ensure the highest levels of system availability and performance”.
“Comprehensive baggage tracking allows early decision making and to operationally employ pro-active tactics to intervene and connect bags that would otherwise be ‘at risk,” notes Mitchell.
Reducing these connection times will help airports to enhance passenger satisfaction and improve the overall capacity within their systems.
Within a 45-minute transfer time there is typically sufficient flexibility for the passenger to make their connection even if the inbound flight is delayed by 15 minutes, but the chance of their bags being loaded on the flight is significantly reduced.
Unreadable bag tags are one of the key reasons why transfer baggage is delayed. When a tag cannot be read by the automated system, it can take several minutes for it to be diverted to a Manual Encoding Station (MES) before being routed back into the automated system. These few minutes can make the difference between the bag making and missing the flight.
The introduction of a Video Coding System (VCS) helps to minimise this delay by enabling the bag-source information to be viewed and encoded remotely, while the bag remains in motion within the main BHS.
This means that the majority of no-read bags no longer have to be diverted to an MES, which results in fewer missed transfer flights in addition to allowing the airport to shavepeaks and minimise bottlenecks, according to BEUMER group.
According to dnata, baggage specific resource allocation tools are used for servicing transfer baggage from arrival flights to an optimum BHS input point to support minimum in-system time. A dynamic BHS which can direct at risk bags to an output nearest to the departing aircraft.
Productivity and availability
Beumer Group utilizes remote access to information and controls, via tablet computers that provide significant improvements in both maintenance productivity and system availability.
“Tablets allow maintenance technicians to access technical documentation, such as a schematic of a particular section of the system, and receive live requests from the control room whilst they are standing next to the BHS. This also ensures that maintenance technicians and operators have access to the latest data, such as the maintenance records for each section of the BHS or the current screening status of a bag found on the floor of the baggage hall or dropped from a trolley on the apron,” explains Klaus.
dnata utilizes Baggage Reconciliation System for tracking and security; BHS for conveyance; Allocation systems to load and move; Activity Control Systems; Analytics
Dnata’s recent breathrough has been RFID and BLE tags, which are becoming more available and affordable to replace traditional baggage tags – associated equipment to process and BHS batch handling techniques, which optimise material flow and efficiency.
Beumer Group’s recent breakthrough has been the development of the dynamic Early Baggage Store (EBS). Traditionally, the EBS has been used simply as a holding-space for baggage before it is sent to make-up.
EBS, therefore, is useful for allowing passengers to check-in early and spend more time within the airport’s retail section. Major hub airports also use the EBS for storing transfer bags before they are required for loading onto the onward flight.
BEUMER’s MD remarks, “A dynamic EBS, such as BEUMER Group’s CrisStore® from the Crisplant technology platform, essentially enables airports to transform baggage handling from a ‘push’ system into a ‘pull’ system. In a typical ‘push’ system, bags are introduced, sorted and discharged to a certain destination, perhaps with a short stay in a conventional EBS whilst waiting for the loading gate to open. In a dynamic EBS, bags are stored individually in totes in a high-bay racking system with 100% tracking so that bags can be retrieved either individually or in batches at any time.
“This creates a ‘pull’ system in which control of the flow of baggage is transferred from the main control room to the operator in the EBS. By monitoring the bags held in the EBS, the ground-handler can assess when there are sufficient bags to fill a single ULD, or for a specific flight, and then recall individual bags to create a batch ready for speed-loading. This allows the operator the flexibility to plan the loading process more efficiently in addition to helping the airport to increase productivity by opening a position, loading the bags, and then closing the position.”
The first ‘pull’ system based on a CrisStore® dynamic EBS has already been installed at Bergen Airport, Norway.
Future automation process
dnata’sRobots and batching cells are interesting and dedicated conveyance networks from baggage make-up areas to aircraft parking bays using AGV’s are too.
Another aspect is Baggage Reconciliation Systems (BRS) which ensure that baggage is cleared to travel – this involves scanning the barcode on abaggage tag.
The scanning is usually undertaken using a hand held device which makes physicalhandling awkward and clumsy; dnata have developed a POC which uses Google glass to scan, which releases the loaders hands to handle the bags.
To sum it all up, baggage handling can only attain the highest standards if the infrastructure is kept ahead of demand, all associated processes and systems are fully integrated and collaborative with its decision making, absolute certainty can be introduced to the logistics value chain, optimum efficiency in presentation of product and handling, automation of loading / unloading and big data analysis.
The digitalization with the focus on seamless travel concepts will play an essential role in the future of all airlines and airports. IT and corporate strategy divisions need to cooperate closely in the planning and realization of their airport’s “digital journey” to provide a stress-free and smooth travel chain for the passengers.The passenger and market outlook for the global aviation industry remains strong with more people projected to travel by air in the future as the middle income population in India, China, Southeast Asia and other emerging markets rises.
Experts estimate global passengers to reach 65 billion by 2030, over-burdening some airports but a boon to some that invested and prepared for such occurrence in terms of technology and new infrastructure.
Germany’s Munich Airport, one of the busiest in the world, is leading the pack in Europe with its innovative ideas and pragmatic approach in seamlessly connecting people and in recent years, making the aviation industry more environment-friendly by tackling the carbon emission problem head on.
In an exclusive interview with Air Cargo Update, Dr. Michael Kerkloh, the political scientist who has been leading the airport’s 9,000-strong men and women as president and CEO, shares his insights on how they have turned Munich Airport from a mere complex of runways and buildings where passengers and cargo take-off, to a Five-Star Airport status, the first and only one in Europe, commanding a high-price for its ideas and innovations.
Kerkloh, who was voted recently as president of the powerful Airports Council International Europe (ACI), which oversees more than 500 airports across 45 countries in the continent, also talks about the impact of security issues on airport finances and how they aim to address it as well as other important matters affecting the industry.
“I am looking forward to continuing the successful work of my predecessors and bringing more visibility to the issues affecting the airport industry and to the work of the ACI Europe team in Brussels,” says Kerkloh.
Taking on more important roles across the globe, Germany is indeed fast becoming a reluctant political powerhouse the world looks up to for protection and sound decisions even in the aviation industry.
Munich Airport marked its first half of 2017 with 21 million passengers, a record since it began operations in 1992.
The figure represents the full-year record for 1999, convincingly demonstrating its powerful dynamic growth.
In 2016, passenger traffic at the airport where people from all over the world descend on varying times of the year to attend international events at the globally famous Messe Munchen, was up 6 percent while total take-offs and landings totaled 200,000 during the period, up by 4 percent.
Cargo movement in 2016 at Munich Airport was also a boon with a new record high of 9 percent year-on-year increase to approximately 180,000 tons.
With the substantial traffic increases, Munich Airport outpaced the industry as a whole in Germany – largely on the strength of a strong performance by the European traffic segment, which showed an impressive 8 percent year-on-year increase in total passengers, explained Corinna Born, Director of International Media Relations at Munich Airport.
Dr. Kerkloh says “Munich Airport is indeed looking stronger than ever before” with the goal of attaining new standard of quality in the coming years.
“We’re now in the enviable position of being poised to add more chapters to our success story for the next 25 years – in the interests of Bavaria and the people who live here,” he said.
Munich Airport made history with the opening of its first midfield terminal in April 2016, which expands its capacity by 11 million passengers per year with plenty of space for retail and dining options for travelers.
Fast becoming known as the Green Airport of Germany, it has also set new environmental airport standards as well as expanding its business enterprise to handling airports around the world.
“In terms of its environmental impact and energy efficiency, the “green terminal” sets new standards for the airport industry. The latest milestone in the airport’s dynamic development was Lufthansa’s decision to station 15 Airbus A350 jets in Munich,” explained Dr. Kerkloh.
“Serving long-haul routes with these advanced widebody jets will result in enormous reductions in fuel consumption, emissions and noise. This also corresponds with the airport’s strategic climate protection targets,” he added.
This month, Munich Airport’s operating company FMG has established a new 100% subsidiary for its international activities. Under Munich Airport International GmbH (MAI), Munich Airport now has a tailor-made platform for handling international contracts in areas of consulting, airport management and training previously implemented by the parent company.
FMG’s know-how and operational success as a full-service airport operating company and its expertise in commissioning new airports have made it a popular choice as a consultant in the aviation industry, generating annual sales of around 10 million Euros.
FMG’s international business division has provided tailor-made solutions at more than 50 airports around the globe, including Bangkok (Thailand), Quito (Ecuador), Madrid (Spain), Barcelona (Spain), Rio de Janeiro (Brazil) and Delhi (India). It plans to open sales offices for Asia, the Middle East and Central and South America.
At present the experts from Munich Airport are involved in the management of airports in Palmerola (Honduras), Cairo (Egypt), and Taif (Saudi Arabia). Consulting services are being provided at such airports as Muscat (Oman), Abu Dhabi (UAE), Riyadh (Saudi Arabia), Quito (Ecuador) and Changi Airport in Singapore.
Part of Munich Airport’s success is a strong leadership that the workforce and management lean on. At the back of this is Dr. Kerkloh who began his aviation career in 1995 at Frankfurt Airport after earning his degree in economics and doctorate in political science.
“In 1995, I became one of two managing directors at Hamburg Airport. In September 2002, I was appointed as president and CEO of Munich Airport. I presided the ADV (German Airport Association) until the end of 2016 and was member of the governing bodies of a number of leading industry organizations,” Dr. Kerkloh recalled.
“In June 2013, I was elected for a three-year term to the board of ACI and became Vice President of the ACI in June 2015. As you can see, I am hundred percent dedicated to the aviation industry.”
A people-person who munches Haribo’s gummy bears for lunch if his schedule is too tied up to even grab a sandwich, Dr. Kerkloh takes care of the airport’s manpower to ensure that they get a fair share of their hard work.
“Munich Airport currently employs 9,000 people. With their hard work and commitment, the employees have played a decisive role in Munich Airport’s success. The airport management team understands the enormous importance of a motivated and competent crew, and has therefore, made it a top priority of the airport’s personnel policy to create and develop attractive jobs and good environments,” the airport executive said.
Munich Airport is currently ranked as top employer in the German transportation and logistics sector, according to a recent study by the news magazine Focus.
“We are well aware of our responsibility for the success and satisfaction of the staff and make substantial investments, for example, in measures to help employees with their work-life balance we offer job trainings in our Airport Academy,” the C noted.
A big fan of Borussia Dortmund (BVB), Dr. Kerkloh said more than handling people, the hardest part of his job was when he welcomed FC Bayern after it won the Champion Leagues Finals against the BVB in 2013.
“You know I am a big soccer enthusiast and my absolute favorite soccer team is Borussia Dortmund (BVB). So, living and working in Munich, the home of Borussia Dortmund’s biggest competitor FC Bayern, can already be quite a “challenge” for a Borussia fan,” Dr. Kerkloh said.
“When FC Bayern won the Champion Leagues finals against Borussia Dortmund in 2013, as Munich Airport CEO, I had to officially welcome and congratulate the FB Bayern Munich winner team upon their return to Munich Airport. You can believe me being a convinced Borussia fan “I suffered.” But since Borussia Dortmund’s club colors are black and yellow, I ordered as many black and yellow “follow-me” cars to be parked directly on the apron around the FB Bayern Munich welcome ceremony ,” he fondly recalls.
Over the past 15 years, many innovations had been realized at Munich Airport but its title as the first and only Five-Star airport in Europe stuck and became the envy of others in the continent.
“Being awarded as Europe’s first and only Five-Star Airport by Skytrax in 2011 was an extraordinary accolade during my career,” said Dr. Kerkloh.
Another accomplishment was a partnership with Lufthansa Airlines to plan, finance, construct and operate a terminal building. Worldwide, this was the first agreement between an airport operator and an airline to run a terminal.
“The idea behind this unique joint venture was to build an efficient and fast hub system and to bundle airport and airline expertise in order to create a terminal building offering maximum service and comfort to passengers,” said Dr. Kerkloh.
“When Terminal 2’s capacity reached its limit of 25,000,000 passengers per year, the construction of the satellite building was the logical continuation of this success story – taking passengers to a new level of comfort.
Further, we are proud of the many honors and awards we have received over the years,” he added.
Dr. Kerkloh is also proud that Munich Airport is recognized as a pioneering Green Airport.
“I consider it also a major accomplish-ment that the governing bodies of the airport operating company have adopted a resolution stating that the CO2 emissions directly attributable to the airport’s operations will be reduced by 60 percent by 2030,” he said.
Through 2030, Munich Airport will invest 150 million Euros to finance all environment related projects geared for its climate protection program.
“A responsible approach to the environment plays a key role in our corporate strategy. We have already rolled out a number of projects that go far beyond statutory requirements and industry standards. Until 2030, we will invest 150 million Euros in total for this climate protection program,” Dr. Kerkloh explained.
Accounting for 4 percent of the GDP in Europe, airports contribute significantly to the continent’s economy.
In 2015, the more than 500 airports across 45 European countries which are members of the Airports Council International Europe (ACI) handled more than 1.9 billion passengers, 18.9 million tons of freight and 22.8 million aircraft movements.
Dr. Kerkloh, who now leads this trade organization talks to Air Cargo Update about his new role and his views on issues that affect the global aviation industry.
ACU: As a German, some view your new role as another proof of Germany’s increasing widening global influence and leadership role. Some say Germany is fast becoming a reluctant global political powerhouse. What can you say about that?
I consider myself a European citizen and in my role as ACI Europe president, I will strive for a positive development of the European airport industry evaluating different interests and needs. That is also how I see Germany – engaged in balancing out European interests and giving active support to hold Europe together.
What are your top agenda as far as policies are concerned as the new ACI president? Please elaborate.
Well, here are some of the most pressing issues on the agenda: Security, the EU Aviation Strategy and how airports need to continue supporting it, climate action, the capacity crunch, digitalization and the airport, Brexit and the list does not stop there.
What would you say are the top challenges facing European airports in this digital age? Please explain.
For many airports, digitalization is already a strategic field of action within their corporate strategy. The digitalization with the focus on seamless travel concepts will play an essential role in the future of all airlines and airports.
IT and corporate strategy divisions need to cooperate closely in the planning and realization of their airport’s “digital journey” to provide a stress-free and smooth travel chain for the passengers. The challenge will be to juggle with numerous airport divisions as well as external partners. Data is the currency and the issue of ownership of data is really only beginning. The next few years will be instrumental in deciding the direction this takes for a generation.
You have successfully run Munich Airport for many years. Perhaps ACI members can learn something from your experience. From an economic perspective, how should airports be managed to keep it profitable while satisfying all stakeholders, including the passengers?
You raise an interesting point and knowledge exchange is one of the primary pillars of ACI Europe’s activities towards its members. Given the scope of the membership and the various sizes of airports involved, there is no one-size-fits-all in terms of advice that going to work for everyone. And although I have been in this business a long time, one of the things I find increasingly interesting is the number of CEOs coming to this industry from other sectors–bringing new fresh thinking, importing ideas from elsewhere–it’s an exciting trend and one that I think is having a very positive influence on the business.
Would you recommend higher passenger and terminal fees at this point? What should airports consider when imposing fees?
With a membership of 500 airports of varying sizes, resources and investment capabilities, I think it would be unwise of me to recommend any one strategy. What I will say is that airport charges are part and parcel of airports being businesses in their own right. Even with that, airlines still pay far less than the cost of the infrastructure they use and every airport seeks to keep its charges competitive, so that they can continue to attract more airline customers and more passengers.
Is Brexit a major concern for ACI as far as moving goods is concerned because of the changes in trade policies?
Brexit is absolutely one of the biggest concerns on our radar at the moment. The implications for European aviation are enormous – especially when you consider the level of connectivity between the UK and the other countries in the EU-27. In the event of a hard Brexit, it would cause major disruption. And when you consider how aviation relies on forward planning, the risks are very real and the clock is ticking.
However, I can say that ACI Europe has been working on this issue for some time now and we are doing a lot to highlight what’s at stake, to the various parties involved.
What is ACI’s goal as far as reducing carbon emission is concerned in the aviation industry?
One of our top priorities at ACI Europe is facilitating airport’s efforts to reduce the industry’s impact on climate change. At COP21, we announced that we would have 50 carbon neutral airports by 2030.
In July, when President Trump decided to back out of the Paris agreements, we decided to double-down on our commitment. So the new pledge is to have 100 carbon neutral airports in Europe by 2030. We have 27 already and there are certainly others who are very motivated to get there in the near future as well. Watch this space!
How big of a concern is airport security as far as you’re concerned considering the number of fatalities and wounded at Belgium international airport at last year’s terror attack?
Aviation security and in particular airport security – is a major priority. It has many facets to it, ranging from ever-evolving technology in airside security and hold baggage screening, cybersecurity, dealing with the implications of heightened security on landside security and of course, most recently the new measures for screening personal electronics being imposed on our airline partners by the Trump administration.
ACI Europe invests a lot of time, energy and resource into seeking the best ways that the various members of the air transport sector can work with home affairs, border control and regulators to make airport security as secure and efficient as possible.
However, it is not an easy task, not least in the current climate where we rely so much more on better intelligence-sharing between government agencies, to combat the threat of terrorism visiting not just the airport, but any public space.
Would you convene your members for a meeting to further discuss security measures that should be unilaterally adopted across all international and domestic airports in Europe to ensure public safety? Please explain further why or why not.
I can assure you that these kinds of meetings happen all the time within ACI Europe. There is regular dialogue and knowledge exchange between our members – last year, we had a Special Summit on Security & Crisis Management.
ACI Europe has also worked hard to establish and maintain excellent channels of communication with the European Commission, ECAC, the US Department of Homeland Security and other relevant agencies.
Is the cost of providing security eating up a large chunk of airport budget? How should airports cope up?
Yes, indeed it is. Pre-9/11 it was only about 5 to 8% of airport’s operating costs. Now it’s something closer to 20%, I believe. That’s quite a jump and in the US, they have the advantage of security being entirely publicly funded and operated by the TSA.
Cutting-edge technology and lots of innovations appear to be the new norm to enhance passenger experience and speed up services nowadays. But for some countries in Europe, implementing changes is still difficult due to budget constraint. Do you think the EU should step in to address this situation?
Airports can benefit from existing EU-funding programs.
A total of 5.5 million passengers passed through Sharjah International Airport, SIA, during the first half of 2017. The latest numbers show an increase of 2.9% as compared to the 5.3 million passengers recorded during the first half of 2016.
In a statement, SIA has also said that 835,800 passengers in June 2017 passed through the airport, a 1.7% growth as compared to the 821,230 passengers during the same month last year.
The aircraft movement increased to more than 37,300 movements from January to June 2017, a 3.8% increase compared to the 36,000 movements during the corresponding period last year. The airport registered 6,115 aircraft movements, including 94 unscheduled ones, during June 2017.
The volume of airfreight handled at Sharjah International Airport in the first half of 2017 was more than 72,998 tonnes, including 11,157 tonnes in June, while the amount of sea-air cargo registered during the period from January until the end of June 2017 was 5,346 tonnes.
The use of smart gates have contributed to the airport’s capacity while there has also been an increase in the number of destinations served by the airlines operating at the airport.
Oman Air and Malaysia Airlines have entered into a code-share partnership effective immediately, according to a statement released by the Omani airline recently.
The partnership will open up more international destinations to Oman Air’s customers. Oman Air’s passengers, who can currently fly direct to Kuala Lumpur, will now be connected to more destinations in Malaysia, China and Australia. This partnership will also pave the way for closer cooperation between the two airlines on a range of other joint initiatives, it said.
DWC welcomed 554,993 passengers in the first half of 2017 compared to 410,278 passengers during the first six months last year, a growth of 35.3 per cent. The first half numbers were boosted by consistent growth in the second quarter during which passenger traffic totalled 221,213, up 45.1 per cent compared to 152,465 during the same period in 2016. The top regions for DWC in terms of passenger volumes during the first half were Eastern Europe (207,798 passengers), the GCC (170,424), Western Europe (61,459) and the Indian subcontinent (55,785 passengers)
Flight movements during the first half totalled 18,371, down 11.1 per cent compared to 20,656* flight movements recorded during the corresponding period in 2016. The average passenger per flight movement during the first half was 121, up 34.4 per cent compared to 90 during the first six months of 2016.
Freight volumes at DWC totalled 443,835 tonnes during the first half compared to 430,132 tonnes recorded in the first six months of 2016, an increase of 3.2 per cent.
“Overall DWC performed well in the first half of the year with both scheduled and chartered carriers contributing to traffic volumes at the airport. DWC’s continuing growth as an important travel and logistics hub is driven by advantages the facility offers to both airlines and passengers – from easy availability of slots to quick turn-around times, access to new catchment area, and quick transit times for passengers,” said Paul Griffiths, CEO of Dubai Airports.
DWC is currently served by eight passenger carriers, operating an average of 95 flights weekly to 14 international destinations and is home to 26 scheduled cargo operators that fly to as many as 70 destinations around the world. DWC is undergoing a major expansion that will see its annual capacity increase from the existing 5 million passengers to 26 million passengers.