PUNCH BAG

With temperatures hovering around the 30ºC in our neck of the woods, we're delighted to bring you some cool, controversial and comic topics this month about an industry which appears to be defying all odds and is doing quite well at the moment if we are to believe the monthly updates from WorldACD Market Data, IATA and a couple of other folks following the ups and downs in the cargo industry. Revenues, profits and even yields are up in some quarters and a few people are already panicking about capacity constraints in autumn, which by the way is just two months away. So, we suggest you sit back and relax and spend a few moments savouring this edition of Punch Bag with its usual dose of crazy things that are going on in the world.

Happy reading
Nol van Fenema

HEY, WANNA BUY A CAR?

- We hear that Tmall, the Alibaba Group-owned B2C shopping site, is looking at introducing "car vending machines" in China which, if we understand this correctly, will do away with endless visits to local car dealerships, kicking tyres and arguing over price with a smart-ass car salesman.
All it takes is a tap on the touchscreen of your mobile phone where you can browse the cars stored in a massive garage-like structure, plus another tap to make an initial payment, and voila, your car is ready for delivery.
According to Yu Wei, general manager of Tmall’s automotive division, “It will make buying cars as easy as buying a can of Coke.” The first such vending machines are expected to become available in China later this year and will allow mobile shoppers with good credit scores to purchase their new ride in only five minutes.
If you qualify for Alibaba’s credit-scoring system for consumers, you can select a model online, pay a 10% initial fee and pick up your new car. All the on-line purchaser will need to do is to make monthly payments through Alipay until the car is paid in full.
Through Alibaba’s “new automotive retail model,” introduced in June, about 1,500, or 5%, of the 30,000 cars sold on Tmall within the first three days of the new payment model’s launch were purchased by consumers using this system.
During a flash sale on Tmall to mark the opening of its flagship store on the B2C platform, Maserati last year sold 100 cars in 18 seconds, while fellow Italian luxury car brand Alfa Romeo followed with its own flash sale last March, selling 350 Giulia Milano cars in 33 seconds.
Not surprisingly, luxury vehicle brands are rapidly expanding online in China to reach the country’s affluent and digitally active consumers, prompting Tmall’s Mr Yu to declare that “The era of online car shopping has already arrived.”

Easy as buying a Coke from a vending machine

LUXURY GOODS ON-LINE

- As China's "car vending machine" novelty shows, Chinese consumers love shopping online, buying everything from toilet paper to luxury products. According to official data, they spent US$758 billion online last year - more than the U.S. and Britain combined.
Apart from the usual stuff people buy on-line such as clothes, electronics or groceries, global luxury brands are also angling for a piece of China’s booming e-commerce market.
As a result, major players like Alibaba and JD.com, as well as smaller luxury-focused companies like Secoo and Xiu, are now aggressively investing in this high-end, and very competitive luxury market, by using their vast customer base to offer upscale retailers support on issues like digital marketing, pricing, customer services and delivery. And, yes, the counterfeiting problem is also being addressed.
So, in a move to make on-line shopping of luxury goods even more attractive, JD.com has introduced a special courier for the delivery of expensive designer goods to its demanding clientele.
Unlike the typical Chinese package delivery boy, the JD.com courier is dressed in a black suit, dark gray tie and white gloves and uses an electric car to transport his expensive cargo. In the time he makes one or two deliveries, the typical Chinese courier would have made about 150.
To show it means business in this lucrative market segment, JD.com last month said it will invest US$397 million in luxury e-commerce platform Farfetch, which is based in London.
And as both Alibaba and JD.com are also considering rolling out separate platforms focused exclusively on luxury in the coming months, you will soon be able to order your Gucci dress, Burberry coat or Tag Heuer watch on-line. Of course, that's after you've bought your dream car on T-Mall.

JD.com exclusive delivery of luxury goods

FARTS

- This may come as a surprise, but we fully understand Qatar Airways' recent announcement that it has decided not proceed with its proposed financial investment in American Airlines, which originally was aimed at building a stake of up to 4.75% in the U.S. carrier.
Sure, the official reason given by the Gulf carrier was that "the latest public disclosure of American Airlines has demonstrated that the investment no longer meets our objectives."
But your investigative Punch Bag narrator knows better and is convinced that the recent evacuation of an American Airlines plane at Raleigh Durham International Airport, which reportedly was caused by what was described as "flatulence" by one of the passengers, must have been the spanner in the works for Qatar.
American's hostile reaction to the investment plan aside, including the cancellation of its code-share agreement with Qatar Airways and no doubt fueled by the ongoing and misleading ranting campaign - together with Delta and United - against Qatar, Emirates and Etihad about state subsidies, but which company in its right mind would want to invest in a carrier where passengers’ farts are causing delays and complaints by fellow travelers of nausea and headaches?
American, of course, rejected the flatulence claims, telling media that the plane was “out of service for an actual mechanical issue - and odour in the cabin."
We tend to rather believe a report in the Charlotte Observer that an investigation by airport officials determined that a passenger had “passed gas.”
No investment in flatulence airline

CHEERS, PROSIT, GAN BEI, SALUT, KANPAI, CIN CIN

- United Parcel Service is reportedly broadening its reach for shipping booze around the world. Bless them.
This piece of good news is based on an announcement by the Atlanta-based integrator that it is expanding its ability to ship alcohol, wine and beer using its UPS Express shipping services.
In a press release, the company said that it will service 24 of the top 35 wine importing countries, and distilleries in nine of the top 25 spirit importing countries. Depending on the destination, orders can arrive within three days.
According to a UPS-sponsored study, the company has identified its key markets as Canada, China, India, Mexico and the UK, also noting that Europe is the production and consumption leader.
The report also said that consumption is growing rapidly in Asian markets, with China expected to surpass the U.S. as the world’s third-largest wine importer by 2020. The fast-growing Asian middle class is driving the demand for premium alcohol. Last year, China imported US$890 million worth of spirits globally, according to the study.
UPS will now ship wine, beer and liquor to consumers and businesses in 11 countries throughout Asia Pacific including: China, Hong Kong, Japan, Macau, New Zealand, Philippines, Singapore, South Korea, Taiwan and Thailand.
In Malaysia, only businesses can import wine and beer, but we know some people in that country who can live with that limitation.
Boozing around: UPS world map of alcohol countries

USELESS AIRPORT

- You will be pleased to hear that a US$372 million airport, dubbed “the world’s most useless” is finally getting its first scheduled service. The problem, however, is that nobody knows when it will start or how much airfares will cost.
According to a report in The Independent, St Helena Airport, on the tiny British Overseas Territory in the middle of the Atlantic, has suffered a decade of delays, overspending of taxpayer cash and accusations of incompetence.
So, despite whimsical details lacking about launch dates and ticket prices, the announcement of a weekly service by South African carrier Airlink, from Johannesburg ought to be welcomed by residents on the remote island, which sits more than 1,200 miles from the nearest major landmass. Up till now, the most usual access to this tiny dot in the ocean is via a five-night ocean crossing on the RMS St Helena, one of the last working Royal Mail ships in the world.
The British government first announced plans to build an airport on St Helena in 2005, but problems finding a suitable construction firm and financial pressures brought on by the global recession meant contracts were not signed until 2011.
The airport officially opened in June 2016, but with a major proviso: large jets cannot land there due to dangerous winds. A test flight with a Boeing 737-800 operated by Comair for British Airways in April last year needed three attempts to make a successful landing, so since its opening only small private planes have been cleared to use it.
A start date for Airlink's Avro RJ86 jet service has not been announced, nor have details about airfares, but despite these uncertainties, the UK Government has already agreed to subsidise the operation to the tune of £1.9m (US$2.5m) for the first year, which equates to more than £36,000 per return flight – or at least £480 per passenger.
Little surprise then that an official report on the airport construction described it as "a white elephant (that) serves neither its people nor the taxpayers footing the bill."
White elephant on St Helena

CHOCOTRAVEL TIPS

- If you're still planning a holiday trip this year, you may like to check the website of Kazakhstan's travel company Chocotravel, which is showing an ad video in which more than just prices are dropping.
In fact, the video includes a group of attractive stewardesses and imaginary pilots stripping down to just their hats to entice you to use Chocotravel for your next holiday booking.
Unfortunately, (see picture below) CargoForwarder Global rules prevent us from showing you the Full Monty, so you will have to do with only the heads and hats of the stewardesses. We hope, though, that you get at least our drift of what's awaiting you once you board the Chocotravel planes.
As expected, the promo clip has been drawing mixed reactions on-line with some accusing the company of sexism, with others praising its visuals.
“I’m sick of this sh*t,” one commenter wrote on Facebook, expressing her distaste for women selling their bodies in advertising. “Disgusting” and “cheap” were other comments to describe the video. Critics also pointed out that the males were depicted as pilots, whereas only females could be stewardesses.
To be honest, after watching the full video clip, your Punch Bag narrator is convinced that he has missed essential parts of Kazakhstan's beauty during earlier trips, and has just confirmed his booking on Chocotravel.

Kazakhstan here we come!

DEATH ON ARRIVAL

- You may possibly remember our extensive coverage of Simon, the giant black rabbit, which traveled on United Airlines from London to Chicago in April, but which was found dead on arrival at O'Hare.
Just to refresh your memory, Simon was not an ordinary rabbit, but a prizewinner at exhibitions and fairs, where they show off these animals. Besides, being a male, he was top in the polls to create, well, offspring, which we understand doesn't come cheap in those circles.
Anyway, in April Simon was bought by three Iowa businessmen who intended to show him at the Iowa State Fair and then displaying the animal and selling related merchandise to raise money for the annual event.
As Simon didn't survive the United flight, he obviously couldn't be put on display, much to the dismay of the three Iowa businessmen, who have now filed a lawsuit against United seeking unspecified damages to cover the costs of the rabbit as well as punitive damages.
The lawsuit states that United was negligent in the care and transportation of Simon and then improperly cremated the rabbit. The lawsuit also alleges United has a poor record of transporting animals, stating the airline accounted for one-third of all animal deaths via U.S. air travel in the last five years.
Not surprisingly, United didn't immediately respond to a request for comment about the lawsuit, which comes as the airline struggles to repair its image after the forceful removal of a passenger from one of its planes at O'Hare airport and the banning of two young girls on a flight because they wore leggings.
Simon didn't make it on United