SHORT SHOTS

IN BRIEF, THE LATEST AIR FREIGHT INDUSTRY NEWS.

DHL’s new Milan facility  -  courtesy DHL
DHL’s new Milan facility - courtesy DHL

DHL also to open new Milan hub
Following on FedEx’s recent plans that they would invest heavily in a new
35,000sqm handling facility at Milan Malpensa, arch-rival DHL Express has made it pub-lic that they have signed an agreement with airport operator SEA to erect a new 90 million euro cargo handling facility there.
The construction on the 46,000sqm facility will in late 2016 and the planning is to open sometime during the first half of 2018.
This is just a part of DHL’s expansion plans in Italy, which are expected to consume over 350 million euros in investment during the coming five years.
The Milan Malpensa facility, once completed, will ensure that MXP will be DHL’s major gateway in the Italian market in the future.

Boeing expects a flood of orders for their 737-800 P2C conversion program  -  credit: Boeing
Boeing expects a flood of orders for their 737-800 P2C conversion program - credit: Boeing

Boeing goes for 737-800BCF conversions
The Chinese domestic freight and postal market has convinced Boeing to go ahead with setting up the B737-800BCF cargo conversion program.
A total of seven customers have placed firm orders with the Seattle airframe manufacturer for 30 aircraft and a further 25 options.
China Postal Services has ordered ten converted aircraft.
Other firm orders came from YTO Airlines, based in Hangzhou, who have place ten firm and ten options.
The U.S. based aircraft lessor GECAS went for five conversions and it can be assumed that they have firm customers for these.
A further five orders with two options were placed by a yet unknown client.
Boeing announced that apart from the above orders that a total of another thirteen com-mitments were placed by SF Airlines from Shenzhen, China, Cargo Air of Bulgaria and another unknown client.
The B737-800 converted freighter has a maximum payload of 22.9 tons over a design range of 3,690 km’s. Main Deck and Lower Deck volumes are 141.4cbm and 43.7cbm re-spectively.
The program seems to be well on its way.

Some movement on the Lithium battery transport restrictions
We’ve been questioning for some months already whether the industry is taking the dan-ger of transporting lithium batteries seriously.
We still maintain that there is too little cooperation and results coming from all parties concerned.
Now - it seems that the International Civil Aviation Organization (ICAO) “has made the first small step” in this direction.
They announced on 23 February to “temporarily” ban shipments on lithium-ion batteries on passenger aircraft.
The ban will apply as of 1st April this year and remain in effect until the new lithium bat-tery packing ruling is drawn and be made mandatory. This is not expected however until 2018.
The ruling does not affect the transport of this well-known potentially dangerous com-modity on freighter aircraft.
Various carriers have already announced that they won’t carry the product in the bellies of their passenger aircraft.
However - the new ruling still has some major holes in it.
Lithium-ion batteries, which are packed with equipment or are already installed in such, as is with cell phones, computers and the suchlike, continue to be exempt from the ban.
Another issue is that it seems that the ban is not binding for all countries and therefore there will be carriers who may well continue to go about business as usual.
Is this the way to go about ridding the airline industry of the problem?

Newly appointed IAG Cargo Chief Drew Crawley presented “resilient results”  -  courtesy IAG Cargo
Newly appointed IAG Cargo Chief Drew Crawley presented “resilient results” - courtesy IAG Cargo

IAG Cargo 2015 commercial revenues under pressure
The IAG Cargo business unit made up mainly of cargo carriage by British Airways and Iberia had to fight its way during 2015 as yields suffered under the imbalance between supply and demand throughout the network.
Total commercial revenues for the past year reached € 1024 million, which is termed as a 3.2% increase over 2014. However, the IAG press release states that after adjusting the 2014 figures to “reflect a directly comparable operation, commercial revenues decreased by 4.6% versus last year.”
Much of the decline is put down to what IAG Cargo’s new CEO, Drew Crawley, refers to as “resilient results in the face of challenging market conditions, where excess capacity and reduced demand are leading to significant price and yield pressures.”
Mr Crawley emphasized that IAG Cargo has exercised strict capacity management and has done much to grow its premium products throughout their network. The pharma product offering grew by 37% for the year and IAG Cargo’s express service held a growth of 14%.
It seems that the carriage of general cargo and the resulting yields has fallen back some-what last year.
IAG Cargo plans to expand its premium products during this year and will offer new cargo destinations, particularly in Central and South America.

John Mc Donagh

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