Kuehne+Nagel’s Apex Logistics International will have the honor of putting the very last Boeing 747 into service.
The 747-8 freighter will be operated under a long-term charter agreement with Atlas Air, supporting customers on the volatile Transpacific trade lanes.
After a half-century production run, the last jumbo jet, christened Empower, was presented to the public at a ceremony at the Boeing Everett Delivery Center in Seattle.
Kuehne+Nagel board member for air logistics, Yngve Ruud, said: “The names we chose for the last two iconic aircraft fit their legacy – Inspire and Empower. We look forward to seeing the last 747-8F aircraft taking off to fulfil the versatile needs of our customers worldwide with unmatched capability.”
Apex group chief executive, Tony Song, added: “This aircraft will reinforce our ability to provide strategic solutions and unique alternatives with passion. Together with our Apex Logistics colleagues, we are delighted to celebrate this special occasion with Kuehne+Nagel, Atlas Air and Boeing.”
Boeing Commercial Airplanes president and chief executive, Stan Deal, said the day was “a testament to the generations of Boeing employees who brought to life the airplane that shrank the world and revolutionised travel and air cargo as the first true widebody.”
Westbound air cargo volumes between Europe and North America rose 6% year-on-year in January – despite high inflation and falling US retail sales, said CLIVE Data Services in its latest report.
However, overall global air cargo demand continued to fall, down -8%, as an earlier Chinese New Year. Economic headwinds subdued other major lanes, according to the latest weekly market intelligence from the Xeneta subsidiary.
The Europe to North America corridor stood out in terms of growth in January, although its average spot rate of US$3.09 per kg edged down 4% from last month. However, compared to the shrinking volume on ex-Asia Pacific (APAC) and inbound Europe trades, transatlantic westbound demand remained buoyant.
But growth has decelerated dramatically from the three-digit growth in rates of +124% in April 2021 when compared to the pre-pandemic level.
The signs of resilience in westbound transatlantic volumes defies the continuing economic pressures facing consumers in the US. For instance, US inflation rose above target again in December 2022 (2%) for a 21st consecutive month. It stood at 6.5%, down 2.6% points from its peak in June last year.
As the air cargo market tends to be more sensitive to economic cycles than the general market, air volume decline led the decline of retail sales by 2 months, and the market outlook remains uncertain. The total inbound US air cargo market registered its first negative growth in May 2022 and stayed in negative territory for five out of the seven remaining months of last year. In January 2023, global air cargo volumes into the US continued to fall, down 2% from a year ago.
Meanwhile transatlantic ocean spot rates increased 230% to $6,148 per 40DC in January compared to the 2019 level. In comparison, the January air spot rate was only 41% above pre-pandemic levels, which was also 14% points below the ratio for the global average air spot rate.
The economic headwinds blew even harder on the European market. Due to the knock-on effects of the Ukraine war, inflation saw double-digit growth since August 2022, hitting retail sales and general air cargo volumes hard. Inbound Europe chargeable weight fell for a 13th consecutive month year-on-year in the first month of 2023, with January air cargo volumes down 9% from one year ago.
Overall global air cargo growth continued to slow last month. The -8% fall in demand, down 10% on the same month in pre-Covid 2019, contributed to the -37% decline in the global airfreight spot rate to $2.89 per kg, narrowing the gap to the pre-pandemic level to +55%. Global air cargo capacity restored a noticeable 11% year-on-year, 2% below the 2019 level.
The global average dynamic load factor, measuring cargo load factor by considering both volume and weight perspectives of cargo flown and capacity available, stood at 54% in the first month of 2023. With the capacity increase and the volume decrease, this resulted in a load factor decline of -7% pts compared to a stronger New Year in January 2022. Compared to 2019, it was also down 5% pts as the demand/supply balance started to lean towards oversupply.
Given the earlier Lunar New Year in 2023, January is not the best month to judge APAC market performance. While the average spot rate from APAC to Europe dropped 11% month-over-month to $4.18 per kg, it remained 72% above pre-pandemic levels, partly due to the rate impact of rising operating costs caused by the Ukraine war.
The average spot rates on the APAC to North America corridor slid 13% from last month to $4.74 per kg in January, 48% above pre-pandemic levels. For ex Southeast Asia trades, average spot rates fell more noticeably, -17% to $4.06 per kg, only 24% above pre-pandemic levels.
Xeneta chief airfreight officer, Niall van de Wouw, commented: “The early Chinese New Year might be causing some noise in the January air cargo data with factories there closing ahead of the New Year, contributing further to a weak global market producing load factors at a level we haven’t seen for some time.
“So, there is still a high level of uncertainty but, if rates haven’t yet reached the 2019 level in value in the current climate, and with an expectation that inventory levels will need restocking at the end of Q2 and Q3, then it’s unlikely we will see spot rates return to the pre-pandemic level unless this happens soon. But this, of course, partly depends on consumers spending in a similar fashion as we have seen recently.”
Elsewhere, although Latin America to North America airfreight volume was down 7% year-on-year in January, this was 29% higher than the 2019 level. Its average spot airfreight rate of $1.43 per kg in January also dipped 7% on the previous month, leaving the January 2023 air spot rate only 13% above the pre-pandemic level, the lowest among all corridors after having been one of the high-growth trade lanes evolving from the pandemic. Capacity on this lane in January rose 36%.
As one of the world’s leading carriers of livestock, IAG Cargo has carried some interesting creatures over the years but surely none as impressive as the Patagotitan Mayorum ‘titanosaur’. This, the largest known land animal ever, roamed what is now Patagonia in Argentina, around 100 million years ago, weighing an estimated 69 tonnes and measuring 37 metres (121ft) long.
Knowledgeable FBJ readers will realise that this is actually longer than most commercial aircraft – it actually about the same length overall as an Airbus A320.
In fact, what IAG Cargo actually flew from Buenos Aires to London was a plaster cast of a complete Patagotitan Mayorum skeleton,in the bellyhold of two British Airways B787-9 passenger aircraft.
The cast is destined to go on display at the Natural History Museum’s exhibition Titanosaur: Life as the biggest dinosaur, for whichIAG Cargo is the official logistics partner. It will be the first time the magnificent titanosaur will be displayed in Europe.
American Airlines is to switch to M&G Packaging’s biodegradable BioNatur Plastics in its cargo operations. The carrier has already begun replacing its current plastic products with the brand at most major hubs, allowed it to reduce its long-term plastic waste in landfills by more than 130,000 lbs or the equivalent of 6.4 million water bottles, in 2022 alone.
While regular plastic can take up to 1,000 years to biodegrade in a landfill, BioNatur biodegradable plastics disappear in only 5 to 10 years and the end products are fully recyclable in normal waste collection streams.
The material includes 1% of an organic, food-safe proprietary additive that allows anaerobic bacteria to digest the plastic in a landfill. Outside of a landfill, the plastic has an indefinite shelf life and performs exactly like traditional plastic products. Indeed, thanks to their added strength, the plastics can be used in thinner amounts, minimizing the quantity of plastic use overall.
The biodegradable plastic is currently in use at cargo operations in Dallas/Fort Worth, New York JFK, Los Angeles, Miami, Chicago O’Hare, Philadelphia and Phoenix Sky Harbor International Airport and American plans to continue adopting the plastic across its network.
Air Canada Cargo unveiled its renewed London Heathrow customer reception area, the first part of a wider project to modernize many parts of its largest European hub.
The reception includes a living wall featuring three types of locally-sourced mosses to help purify the air as well as improved workstations for customer service agents.
Senior director for Europe, Middle East and India, John Lloyd, said: “This improvement to our London Heathrow facility is the first of many investments in both customer-facing areas and our operations. The new space better represents the Air Canada Cargo brand and is a clear sign of the airline’s commitment to London as a hub facility as it continues strategically expanding the business.”
UPS reported revenues down 2.7% from last year at $27.0bn in its fourth quarter 2022 earnings. However, for 2002 as a whole, revenue increased 3.1% to $100.3 billion. Diluted earnings per share were $3.96 for the quarter and adjusted diluted earnings per share were $3.62, 0.8% above the same period in 2021.
UPS said it expects revenue in 2023 to be between $97.0 billion and $99.4 billion and consolidated adjusted operating margin of between 12.8% and 13.6%. It also expects capital expenditures to be about $5.3 billion, dividend payments to be around $5.4 billion, subject to Board approval, and share repurchases to be around $3 billion.
EL AL Israel Airlines has signed a master rental agreement with DoKaSch Temperature Solutions for the German provider’s Opticooler containers. With some of the world’s largest pharma manufacturers based in Israel, El Al will be able to safely transport temperature-sensitive products to and from its headquarters at Ben Gurion Airport in the belly of its passenger fleet as well as a dedicated cargo aircraft to 42 destinations including New York, Boston and Los Angeles.
Pharma manager at EL AL cargo division, Moshe Popovich, said: “Pharmaceuticals are the fastest growing market segment in the air cargo industry. However, temperature fluctuations during transport can pose a serious threat to the integrity of these sensitive products. The Master Rental Agreement with DoKaSch Temperature Solutions supports our high standards in this area and enables us to offer our customers stable and high-quality transportation for their pharmaceutical shipments.”
DoKaSch global marketing manager and business development manager for Israel, Dor Saidof, added: “In a country with a hot climate like Israel, it is essential that the packaging solution can reliably protect the sensitive goods.”
Air Charter Service has opened an office in Washington DC to serve the capital and the Virginia and Delaware regions. Joel Fenn has been appointed as chief executive of the new office, the broker’s ninth in the US. Fenn was most recently chief executive of ACS’s Miami operation, and commented: “We have always had a strong customer base here in the capital and we were fortunate enough to have a couple of extremely successful years across our US offices, despite the pandemic, and felt that now was the right time to open our office here.” He started his ACS career in 2005 in the company’s London headquarters, where he worked his way up to the position of Private Jets Director, before taking on the same role in the Hong Kong office. He then moved to Miami in 2015, taking the reins when ACS opened their Florida office in the city. Adding to the team is Chris Fisher, as cargo business development director.
SEKO Logistics has appointed Richard MacLaren as its new senior vice president, global ecommerce. He brings over 20 years of experience and prior to joining SEKO, Richard was the global senior vice president for consumer goods and ecommerce at Hellmann Worldwide Logistics.
In his new role, MacLaren will be responsible for enhancing and executing overall strategy and structure and will lead the SEKO team in delivering high-velocity ecommerce logistics solutions to clients.
Since launching its dedicated Ecommerce business unit in 2022, SEKO ships over 10 million parcels a month around the world from over 150 locations in 60 countries.
Maclaren said: “The global supply chain and ecommerce market is rapidly evolving, but the SEKO team has built a foundation to respond to these changes effectively. This team moves fast, with sound strategy, and I feel energized to be joining this group of logistics experts.
“Already, SEKO’s multi-channel fulfillment centers span the globe and allow clients to open up sales strategies to new markets and scale business with a single integration. Through our network of ecommerce hubs and multi-user logistics sites, we’re currently giving our clients the ability to maximize their global footprint effortlessly. My vision is to continue to hone that strategy and identify new opportunities to help our clients even more.”
Martinair, part of Air France KLM Martinair Cargo, has placed a firm order for four new A350F freighter aircraft. The new aircraft emit over 40% less CO₂ and make 50% less noise than their predecessors and will replace the current Boeing 747 freighters from the second half of 2026. Maximum payload of the chosen configuration is 108 tonnes.
Adriaan den Heijer, executive vice president Air France-KLM Cargo and managing director of Martinair said: “In choosing the A350F, we are taking an important step to cut CO₂ emissions and noise pollution. I am very pleased with these new, technologically advanced aircraft joining the fleet, which fit well in the Air France KLM Martinair Cargo operation. For our customers, the versatility of the A350F is good news for the future. The new aircraft are an important addition, supplementing the belly capacity of our extensive intercontinental passenger fleet.”
