AirCargoNet

CHINA’S government has decreed that the country’s three main airlines – Air China, China Eastern and China Southern – have to merge their cargo operations.

The authoritarian move is an attempt to challenge foreign carrier’s dominance of the market. About 70 per cent of the international air cargo in China is carried by foreign airlines.

A task force made up of airline officials and state officials from the Assets Supervision and Administration Commission (Sasac) has been formed to work on the structure of the proposed joint venture.

An unnamed source told the Chinese media that the cargo airline would be based in Shanghai.

If the plan goes ahead (and with the Chinese government’s hand at the tiller why wouldn’t it?) the joint venture between Cathay Pacific and Air China, aiming to service China’s Yangtze River Delta region, is put at risk.

However, a Cathay spokesperson said: “Our target of having the joint venture carrier coming into operation this summer remains unchanged.”

SINGAPORE Airlines (SIA) has posted a six-fold increase in profits for the fourth quarter. Net profit from January to March was US$197 million, up from $29 million the year before.

Combined with the $286 million profit for the third quarter this reverses the $330 million loss made in the first two quarters of the financial year, in the middle of the industry low.

However, for the full year ending 31 March, the carrier’s net profit was still down 79 per cent from the previous year’s results, from $752 million down to $152 million

“Forward indicators suggest that the recent recovery in volumes of air cargo will hold up in the near term,” the airline said in a statement. “Yields for…cargo should keep pace with the growth in demand.”

SIA Cargo managed to make a gross profit of $8 million compared to a loss of $123 million the year before.

PLANS to develop Scotland’s Carlisle Airport into a freight storage and distribution centre have been scuppered by a local Irthington farmer, Thomas Brown.

Brown went to the Court of Appeal, which has now ruled that the authority should have conducted a full environmental-impact assessment before approving Stobart Air’s plans for the airport.

Stobart’s chief executive officer, Andrew Tinkler, said: “We intend to appeal as we feel the court has not given due regard to us as an airport operator. Despite this setback, we remain committed to finding a solution for our future logistics activities at the airport.”

However, he added: “If it’s not possible to do it in Carlisle we’ll have to look at other areas. Hopefully as time goes on we’ll be able to get the solution we need at Carlisle Airport.”

The leader of Carlisle City Council, Councillor Mike Mitchelson, said: ”The city council will continue to work with the developer to bring forward improvements to Carlisle Airport. We will also give detailed consideration to the terms of the judgment and any possible grounds for appeal.”

Aviation consultant Peter Elliott, who once worked for Tinkler and who acrimoniously left the company’s employ said with Schadenfreude glee: “I am thrilled for the people of Irthington. There will now be no airfreight aircraft flying low over their village.”

Elliot had tried to take Tinkler to court for alleged “criminal aviation activities” at Carlisle Airport. The case collapsed, leaving Elliott bankrupt.

AUSTRALIA’S International Air Services Commission has awarded Qantas unlimited cargo capacity and frequency on its Korean route for 10 years.

No other Australian carrier challenged the ruling.

Qantas plans to operate a 747-400 freighter wet leased from Atlas Air on the weekly routing that will take in Sydney-Seoul (Incheon)-Anchorage-Chicago.

Australian airfreight volume came in above expectations in December, an increase of 1.2 per cent to 773.6 million tonnes after falling 2.2 per cent in 2009.

BRITISH Airways World Cargo (BAWC) has posted revenues of £550.3 million for the financial year 2009/10, a fall of 18.2 per cent from the same period last year. In addition, commercial revenues were down 26.1 per cent.

Volumes were 2.2 per cent down to 4.5 million cargo tonne kilometres (CTKs). Cargo capacity for the same period was down 4.2 per cent. Overall yield fell 16.4 per cent, driven by lower levels of fuel surcharge and underlying market conditions. Excluding the impact of exchange rate movements, yield decreased by 24.5 per cent.

Revenues at BAWC’s parent company British Airways were down £1 billion, although it managed to cut costs by nearly £990 million, largely thanks to a £600 million saving from lower fuel costs over the year.

However, conditions improved in the fourth quarter where revenue increased 9.2 per cent and volumes by 5.8 per cent compared to the same quarter in the prior year. However, this must be measured against the very low figures of that time.

Steve Gunning, managing director, BA World Cargo comments: “In order for the recovery that has commenced in the second half to be sustained, we must continue to improve yields. In addition, a full recovery will be dependent on a rational and measured re-introduction of capacity.”

Rachel Izzard, financial controller, BA World Cargo, said: “Demand for cargo continued to improve in the fourth quarter, following the high unanticipated peak in the third quarter, led by demand for additional capacity out of China and South-East Asian markets. These markets continue to maintain a high level of demand for airfreight and our decision to maintain our freighter routes enabled us to build upon this recovery. Demand for our premium products has also remained strong with volumes maintained in spite of the ongoing global economic turbulence.

“While, we experienced some disruption to our schedule as a result of the heavy snow and ongoing industrial action, our response, in terms of scheduling solutions and the deployment of our comprehensive trucking network, meant that we were able to minimise the impact across the cargo business,” Izzard added.

DUBAI Airports is forecasting a 48 per cent increase in freight volumes for cargo traffic at Dubai International (DXB) and Dubai World Central (DWC) Al Maktoum International over the next five years.

Cargo tonnage, which totalled 1.9 million in 2009, will exceed 3 million tonnes by the end of 2015. In 2010 alone, freight volumes are expected to rise 12.2 per cent. Improving economic conditions, Dubai’s geocentric location along with anticipated capacity increases by Emirates Airline and other cargo and joint production (cargo and passenger) airlines will be key drivers behind the increase.

Dubai International currently has capacity for 2.5 million tonnes of freight per annum. The first phase of Al-Maktoum International, which opens for cargo airlines this summer, will feature a single A380 compatible runway, 64 remote stands, a cargo terminal building capable of handling 250,000 tonnes per annum expandable to 600,000 tonnes per annum and a dedicated road link to the region’s largest port in Jebel Ali. Plans are in place to optimise DWC and DXB cargo capability to handle anticipated traffic growth to 2015 and beyond.

HH Sheikh Ahmed Bin Saeed Al Maktoum, president of the Dubai Civil Aviation Authority and chairman of Dubai Airports said, “Aviation is too important to Dubai’s economy to fall prey to the short-term thinking that has led to costly capacity constraints and congestion at so many airports around the world.”

“DWC is clearly a long term project. Phase 1 will provide much-needed freight capacity in the near to mid-term,” said Paul Griffiths, CEO, Dubai Airports. “The vision is to eventually develop…Al Maktoum International into a multi-modal logistics hub which capitalises on its ideal location next to Jebel Ali Port as well as its connectivity by air to major consumer markets worldwide.”

AIRFREIGHT through Hong Kong rose 41.9 per cent from last year, to 248,027 tonnes. This is a nine per cent increase from the same month in pre-crisis April 2008, which saw 225,660 tonnes handled.

Of particular note was the 10,080 tonnes handled 23 April, which was the highest daily tonnage throughput that Hactl has ever recorded.

Export volume showed a significant year-on-year growth of 53.5 per cent in April, with volume reaching 138,123 tonnes. Cumulative export tonnage for the first four months was 476,569 tonnes, representing a year-on-year growth of 45.9 per cent.

Import volume for April was 61,785 tonnes, representing an increase of 32.1 per cent year-on-year, while cumulative import tonnage for the first four months was 236,354 tonnes, up 39.2 per cent against the same period last year.

Transshipment volume for April increased 26.5 per cent year-on-year to 48,119 tonnes. Total transshipment volume from January to April was 171,847 tonnes, representing an increase of 21.6 per cent year-on-year.

Lilian Chan, general manager, said, “While we expect that 2010 will be a strong year due to the reviving economy, we will stay prepared for the unexpected.”

FOUR Indian carriers have suspended their cargo operations at Delhi in protest at “unfair practices”.

A spokesperson for GoAir, IndiGo, Kingfisher and SpiceJet said: “Since neither DIAL [Delhi Indira Ghandi International Airport] nor the outsourced agency [Delhi Cargo Service Centre] are listening to our problems, we have decided to suspend our cargo operations from this afternoon.”

He said that the airlines claim, “there is neither infrastructure nor the manpower to handle cargo operations” sufficiently at the airport. Complaints have apparently been repeatedly ignored.

THE US Federal Aviation Administration (FAA) wants to fine Atlas Air over $572,000 for improper maintenance and repairs on its freighters, but the carrier is opposing the ruling.

For the first violation, the FAA alleges that Atlas Air installed a replacement cockpit window on a Boeing 747F incorrectly, resulting in pressure leaks when in use on 49 flights between 4 April and 27 April last year.

For the second violation, the FAA alleges that on 14 and 15 May last year Atlas operated a 747 from Huntsville (US) to Glasgow (UK), Luxembourg (city) and back to Huntsville without an outboard engine pylon access panel door. Instead, an aluminium piece of sheet metal was fixed over the door opening using only speed tape. On both flights the panel came off in mid-flight and was replaced at each stop.

CHINA Southern Airlines posted a net profit for the first three months of 2010 of 1.42 billion yuan (US$205 million). This is an increase of 539 per cent from the same period last year.

Revenue increased 31 per cent from 12.93 billion yuan last year to RMB 16.88 billion yuan.

Building on its success, the airline says that it is planning on increasing its fleet to 378 aircraft from 348: buying 15 Boeing and 24 Airbus aircraft, but selling nine MD-90-30s.

In the meantime, following the stalling of its proposed joint venture with Air France-KLM, it has also confirmed that it is considering forming an alliance with another Chinese airline to boost its position in the domestic air cargo market.

“We have not ruled out the possibility of cooperating with other mainland carriers to develop the cargo business,” chairman Si Xianmin said.