the value of air cargo - international civil aviation ... · pdf fileforwarder evolution...
TRANSCRIPT
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The Air Cargo – Some Fundamentals
Vladimir D. Zubkov • Vice-President, Volga-Dnepr Group
• Board Member of TIACA
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190 - Countries
1180 - Airports around the world
Volga-Dnepr Offices
AirBridgeCargo Offices
Maintenance Bases
Charter flights
Scheduled flights
Atran Scheduled flights
Volga-Dnepr Group – some facts
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Loading/Unloading System for up to 80 Tons Heavy Cargo
Moscow – Le Bourget. Angara Space Launcher
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Сonstruction engineering
Under Own Power Loading System
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Value of Air Cargo
• The Value to modern life – Consumers
• The Value to economic prosperity – Governments /
Regulators
• The Value to the global community – everyone
• The Value to Airline CEOs
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One Theme
The air cargo industry came up
with a campaign: “Air Cargo
Makes it Happen”
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The Value to modern life
• Daily Impact if Air Cargo didn’t exist
– Food
– Clothes
– Entertainment
– Technology
– Leisure
– ....
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The Value to the Global Community
• First responder in getting relief to natural disaster sites
• Safe and controlled transport of medicines
• Vaccines …. etc
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The Value to the World Economies
World trade in goods and air FTKsSource: Netherlands CPB and IATA
8
9
10
11
12
13
14
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Bill
ion
FTK
s
90
100
110
120
130
140
150
160
170
inde
x of
wor
ld tr
ade,
200
0=10
0
International FTKs
(left scale)
World goods trade
volumes
(right scale)
Air cargo was always considered as a barometer
of the global economy
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However, in the recent years air cargo is on decline
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Where the economic growth is coming from
China, 35%
India, 12%
Latin America, 9%
US, 9%
MENA, 6%
Euro-zone, 4%
CE Europe, 3%SS Africa, 3%
Share of world GDP growth 2008-2011
Source: Haver
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2.0
4.4
4.7
Source: IHS Global Insight
Annual GDP growth 2011 – 2030
1.3
2.7
2.8
3.3
3.4
4.1
4.2
4.4
7.0
7.1
Northeast Asia
Southeast Asia
Asia Pacific
Europe
North America
Oceania
World
CIS
Latin America
Middle East
Africa
South Asia
China
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All is Interconnected: iPhone
Manufacturing & Distribution Process Demonstrates Importance of
Good Logistics
and the Utility of Air Cargo to World Economies
Component Manufacturing
Final iPhone Assembly
iPhone Components &
Source Countries
LCD Display
Flash Memory Chip
Applications Processor
DRAM Memory Bluetooth, GPS Chips
Radio Frequency Memory
Touch Screen Control, Wi-Fi
Receiver/Transceiver
Power Management
Accelerator/Gyroscope
Compass **iPhones are available in all blue countries
Source: New York Times, 05 July 2010, “Supply Chain for iPhone Highlights Costs in China.”
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The importance of air cargo …
USD 6.4 Trillion
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The Value to Airline CEOS
• Air Cargo makes DOLLARS and SENSE
• Quality, Premium Service, Vital….
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The importance of air cargo …
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The importance of air cargo …
Industry Revenue
contribution
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Air Cargo Traffic Is Forecasted To Outpace Passenger Traffic Growth in Most Major World Markets
World
Passenger 5.1%
5.9%
7.0%
4.6%
4.0%
3.6%
2.3%
5.1%
Cargo 5.6%
6.2%
7.4%
4.9%
3.1%
3.8%
2.6%
6.1%
5.4%
5.4%
Intra
Asia
North
America
Intra Intra
Europe
Europe-
Asia
Asia –
North America
North America
North America -
Latin America
Europe –
Africa
Average Annual Traffic Growth Rate 2011 - 2030
Europe -
Europe -
Latin America
4.8%
5.2%
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Freighter Fleet will Nearly Double with a
Shift Toward Larger Freighters
2030
3,500 freighters
2010
1,760 freighters
35%
26%
39%
0
500
1000
1500
Standard-body Medium
widebody
Large
30%35%35%
0
500
1000
1500
Standard-body Medium
widebody
Large
Large (>80 tonnes): MD-11, 747, 777, A350, A380, AN-124, IL-96, etc. Medium widebody (40-80 tonnes): DC-10, A300, A310, A330, A340, 767, 787, etc. Standard-body (<45 tonnes): DC-8, DC-9, Tu-204, A320, 727, 737, 757, etc.
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27
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But key customers are reducing shipments
-26
-22
-18
-14
-10
-6
-2
2
6
10
14
18
22
26
30
34
38
-34
-26
-18
-10
-2
6
14
22
30
38
46
54
% g
row
th -
Inte
rnat
iona
l FTK
s
% G
row
th, S
emi-C
ondu
ctor
Shi
pmen
ts
Semi-Conductor Shipments and Air FreightSource: IATA, SIA
International FTKs
Semi-Conductor Shipments
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However, as stated before – the air cargo is on decline
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Cargo and passenger markets have diverged
11
13
14
15
16
17
330
350
370
390
410
430
450
2007 2008 2009 2010 2011 2012
Mon
thly
FTK
(Bill
ions
)
Mon
thly
RP
K (B
illio
ns)
Total Air Freight and Passenger VolumesSeasonally Adjusted
RPK
FTK
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31
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Forces and Constraints for Air Cargo Growth
Trade quotas and restrictions
Currency revaluations
Air and surface labor stoppages
“Open Skies” & new air services agreements
Industry relocation
Directional imbalances
Surface
competition
Airport curfews
New commodities
Widebody freighters,
and lower holds
Airline market research
Airline market and shipper education
Shipper utilization
Proliferation of points served
"Just in time" concepts
Express market
Deregulation
Oil/fuel prices and availability
National development programs
New trade relationships
Export promotion
World and regional
GDP growth
Terrorism/ armed conflict
Lack of airport access
Environmental regulations
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Modal Shift
AstraZeneca is shifting transport of pharma products from air to
sea, with the objective by end of last year to have moved 40%
to sea transport and by end of 2013 70%.
Ericcson: better production planning will support strategic shift
away from Air Cargo
Sony Corp.: CSR (Modal shift) nearly 30% of total VAIO®
notebook computers are now by sea transport
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The industry must reshape
• Solutions must align with customer demands
• Costs must be reduced
• Processes must be simplified
• Technology must be embraced
• Innovation must replace status quo
• We must collaborate to produce integrated solutions
• Relationships with Forwarders must be redefined
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The air supply chain
Complex
interfaces…
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E–freight:
what happens with the documents
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The GACAG* vision for 2015
2 – Digitization Core
Transport Docs
3 – Digitization
Commercial docs
Shipper
Customs
and
Regulators
Forwarder Handler
1 – Global e-freight Network
IATA (GACAG support) IATA (FIATA support) FIATA & GSF
Forwarder
Airline
Airline
80% world trade lanes allow
paperless air cargo
transport
• 100% e-AWB,
• e-House Manifest & e-
Flight Manifest capability
on e-freight trade lanes
Use of e-pouch for large
set of cargo shipments 2015 Goal
Lead
* GACAG - the Global Air Cargo Advisory Group,
which comprises four global industry associations – IATA, FIATA, TIACA, and the Global Shipper’s Forum
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Generation born 1981 – 2001
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Acceleration of new consumer paradigm
Cyber Monday Online SalesSource: comScore, Inc.
Day Year
Sales
(millions
of US$)
% Change
November 27 2006 $610 N/A
November 26 2007 $730 20%
December 1 2008 $846 16%
November 30 2009 $887 5%
November 29 2010 $1,028 16%
November 28 2011 $1,251 22%
40
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A vision for a modern industry (1/3)
• Strengthening industry relationships – Modernize IATA Agency model: partnership based, aligned with airline /
forwarder evolution
• Reacting to business model evolution – Respond to changing consumer patterns…collaboration with supply chain
partners a must to address “click-buy-fly” home-to-home or factory-to-home
trends.
– Value price, service revaluation… bespoke supply
chain solutions (commodity specific)
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A vision for a modern industry (2/3)
• Maintaining high level safety & security
• Re-engineering ground processes – Acceleration of transportation process. Collaboration with supply chain partners a must to
address “shipper to aircraft” process.
• Ensuring technology is fully embraced – Reduce reliance on human intervention… e-booking, e-
track, e-claims, e-delivery, e-perform
– Data exchange rather than message exchange
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A vision for a modern industry (3/3)
• Collaborating for a sustainable industry – Accelerate “Value of Air Cargo” campaign - shout not
whisper air cargo’s role in today’s world
– Target young and entrepreneurs to embrace “logistics” as a career choice
– Focus on training must increase… hard and soft skills
– Work on environmental issues: ability to calculate our carbon footprint, best practices to be greener
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Security: protecting the skies
• ACC3
• ACAS
• New ICAO guidance material
• RA / KC programs
• +++
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Fighting the Green battle
• MISINFORMATION:
– Air Cargo accounts for 2% of global CO2 emissions
– Port to Port reporting is sufficient
– Airlines are doing nothing
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Air Cargo – Vital for todays society and economy
46