The Cargo Letter
Section A: Trade, Financial & Inland News | Section
B: FF World Air News |
Section C: FF World Ocean News | Section
D: FF in Cyberspace |
Section E: The Forwarder Broker World
Forwarder World Air Briefs
- More Open Skies......... as the U.S., Brunei, Chile, New Zealand
& Singapore completed a new multilateral open-skies agreement at the
meeting of the Asia-Pacific Economic Cooperation group held in Brunei in
late Nov. The pact was the culmination of the 1st multilateral initiative
specifically focused on the comprehensive liberalization of aviation
services in the Asia Pacific region. The U.S. currently has open-skies
agreements with 50 aviation partners, including the 4 countries joining it
in the new multilateral agreement.
- United Deal Blaste......... as the U.S. General Accounting Office
has published a damning report into the United Airlines proposed takeover of
US Airways. It showed that the enlarged airline would reduce competition in
5 times as many markets as it would bolster consumer choice, the GAO stated.
In related news, The European Commission will take another 3 weeks to decide
whether to block or approve the UAL deal.
- Track Record......... as UPS established a technology milestone on
Dec. 19 when it received nearly 6.5 million online package tracking requests
in a single day. It's nearly double the number of online tracking requests
(3.3 million) received on last year's busiest day, & more than a 6 fold
increase from the busiest day in 1998. The number has shot up like a rocket
since UPS recorded only 100,000 online tracking requests during the entire
month of Dec. 1995.
- Going Up......... as FedEx will increase U.S. air express rates
4.9% on Feb. 1. Following suit, UPS will increase its air shipment rates
3.7% effective Feb. 5. Int'l shipments will rise 2.9%. Ground service _ the
bulk of UPS's business _ will rise 3.1% for all weights and zones, & the
fee for residential deliveries will increase from US$1 to US$1.05 on all
packages. UPS will keep the 1.25% fuel surcharge it began assessing in Aug.
"with the hope that fuel prices will eventually stabilize at lower
levels." UPS will publish the new rates Jan. 4 on its Web site.
- Going Down......... as the U.S. Dept. of Transportation has given
tentative approval to Continental Airlines & Delta Air Lines to operate
U.S./Argentina air services. The lines were granted 7 flights a week to
- Going Around The World......... as UPS is increasing the number of
around the world flights to further enhance service between the U.S. &
markets in Europe, the Middle East & Asia. On Nov. 28, UPS began
operating 2 additional weekly frequencies that connect the globe using B-767
freighters. Each week, the aircraft depart from the U.S. from the company's
all-points Int'l air hub in Louisville. From there, the aircraft fly to
Cologne, Sharjah (UAE), Mumbai & Singapore, arriving at UPS's Asia
Pacific hub in Taipei. The aircraft carry volume from Asia back to Europe by
reversing the schedule. From Cologne, the aircraft then repeat the route to
Asia, returning to the U.S. via Anchorage. With UPS's 3 existing around the
world flights, the 1st of which was initiated in 1998, the total number of
worldwide flights has now increased to 5 per week. For the 3rd quarter of
2000, UPS Int'l export volume climbed 23% over the same period in
- On The Rebound......... as Italian national carrier Alitalia is
unable to find a partner in Europe, so it has decided to look to the U.S.
for a link-up. According to a recently approved four-year business plan,
Alitalia will try to strengthen its position in Europe by entering into
strategic accord with a leading U.S. airline. Alitalia has recently seen a
deal fall through with Dutch carrier KLM, largely due to the Italian
airline's association with the unpopular Malpensa airport which it is
seeking to transform by itself into a regional hub.
- LanChile Buys American & Mexican......... as Chile's largest
passenger & air cargo carrier, has announced that it purchased from
entities related to LanChile's majority shareholders, a 25% stake in
Aerotranportes Mas de Carga, S.A. de C.V. ("MasAir") for
approximately US$5.1M & a 25% stake in Florida West Int'l Airways Inc.
for approximately US$0.9M. MasAir is a Mexican cargo airline, with annual
sales of US$60M. It is designated by the Mexican authorities as one of the
regular cargo operators between the U.S. & Mexico and the largest Int'l
airfreight operator in Mexico with DC-8 freighter service to a variety of
destinations in the U.S. Florida West is a North American cargo airline with
annual sales of approximately US$40M, based at MIA.
- Airborne Goes "E"......... as "Airborne eCourier"
is a new service that will enable its shippers to send confidential, signed
documents electronically. It enables users to add an electronic signature,
making legal document transfer available electronically for the 1st
- First It Was Out With The Freighters......... as United will halt
its daily nonstop flights between Chicago & Honolulu as of Feb. 15 _
bringing an end to a service it has offered since 1969. A United spokesman
said the loss of the Chicago-Honolulu route is tied to the retirement of the
last 3 aging DC-10s in United's 600-plus fleet of planes. This month also
marks the end of United's freighters as the DC-10s are retired.
- Uncle Sam Has A Freighter For You......... as the U.S. Air Force
says it hopes to foster development of a commercial version of its giant
Boeing C-17, backbone of the U.S. military's heavy airlift capability.
Citing what it called an extensive market review, the service said it had
found "a strong business case" for the proposed BC-17X variant in
the market for ferrying outsized goods such as satellites, construction
equipment &power generators. The Air Force & Seattle-based Boeing
Co. said the commercial variant -- capable of carrying about 87 tons in its
20,900 cubic foot (592 cubic meter) cargo area -- was part of an innovative
plan for much-needed additional wartime & contingency capabilities to
ferry military equipment & troops. Under the plan, a commercial operator
would get some mix of guaranteed military airlift business plus up-front
funding & a possible buy-back deal. In exchange, the Defense Dept. would
have guaranteed use of the cargo aircraft when needed. The proposed BC-17X
would be stripped of several key military functions but retain the ability
to land on short, unpaved, remote runways with oversized loads too big to
fit through the doors of conventional freighter aircraft. The Air Force says
there are no current plans to lease its bombers.
- Moving Ahead......... as China Southern Airlines has been ranked as
the 23rd largest airline in the world according to Air Transport World
- Come From Behind......... as the formerly struggling Aeroflot now
has 105 planes & flies 75% of all foreign flights by Russian airlines,
and 11% of the domestic flights. The company has managed to increase its
economic efficiency and on average fills 65.2% of seats on its flights _ a
level comparable to performance of its leading foreign competitors. Aeroflot
expects to earn more than one billion dollars in 2000 on a revenue rise of
15%. On the scandal side, however, Russian prosecutors accuse tycoon Boris
Berezovsky, who reportedly had an interest in Aeroflot, & 2 former
Aeroflot executives of funneling US$970M of profits from Aeroflot to two
firms that Berezovsky helped found in Switzerland, Forus Services &
Andava. Berezovsky and other suspects, Nikolai Glushkov & Alexander
Krasnenker, have denied wrongdoing. Glushkov, Aeroflot's former first deputy
director, was arrested this month. Berezovsky has refused to show up for
questioning & remains abroad.
- Still Behind......... as the Malaysian government's purchase this
month of a controlling stake in Malaysia Airlines (MAS) from tycoon Tajudin
Ramli has put in motion the long-awaited restructuring of the debt-ridden
national carrier - but analysts stress much work remains ahead.
- Still Forwarding......... as Forward Air has purchased the assets
of Dedicated Transportation Services, Inc. based in Santa Ana, California.
DTSI is a leading contractor to the air cargo industry providing both
truckload & LTL surface transportation to its nationwide customer
- At Last?......... as an end may finally come to a story we seem to
have endlessly covered for years. Cyprus' national carrier Cyprus Airways
has expressed an interest in bidding for a takeover of Olympic Airways, the
highly troubled Greek state-owned airline.
- Close Call......... as an Ethiopian Airlines B-757 freighter
suffered heavy damage on landing at Cairo airport in disputed circumstances
on Dec. 7. They said the one of the plane's engines was destroyed, one was
damaged, tires exploded and its undercarriage & fuselage were damaged.
Ethiopian Airlines officials blamed the mishap on an unidentified object on
the runway. Cairo airport officials denied this, saying the runway, 05R, had
been swept 2 hours before the plane landed. They said the explosion of the
tires had caused the damage.
- UAL's New MIA Digs......... as United Cargo, a division of United
Airlines, has opened a US$34M cargo facility at Miami Int'l Airport. The
90,000-square-foot warehouse is located on 8.2 acres in the airport's
southwest sector. The warehouse offers 7,000 square feet of cold storage to
handle perishables, such as flowers, fruit & vegetables and can be
expanded by an additional 31,000 square feet. United Cargo moved about 95
million pounds of cargo through MIA in 2000, and projects volume to increase
to nearly 125 million pounds in 2001.
- Cancel That New Lease......... as the future site of a new airport
for Mexico City hangs in the balance because the current choice of location,
Lago de Texcoco, may be unsuitable. Experts have expressed concern that the
foundation would be built on mud-like soil & that the facility would not
be up to the required standards.
- Busted......... as 3 cargo handlers were suspended Dec. 19 by
Northwest after they were shown on television treating holiday packages like
basketballs. ''We were embarrassed & disturbed by their actions,'' said
Northwest V.P. Dirk McMahon. News footage shot by KSTP-TV showed the 3
taking packages off a plane at Minneapolis-St. Paul Int'l Airport, tossing
them over their heads, behind their backs, high into the air & into a
bin. The videotape also showed one of the packages crashing to the ground.
One handler picked up a box coming off the plane & lobbed it to a
co-worker who threw it high & backward into the bin (2 points). One
worker took a mailbag & attempted a reverse two-handed overhead shot
that missed. (Still, the loading did not go into over time.) The tape also
showed larger packages landing on top of smaller boxes, potentially crushing
them. KSTP said one of its news crews stumbled onto the pre-Christmas scene
while working on another story. It said the airline workers were playing
with the packages in plain view. Northwest officials said that normally an
employee goes inside a large bin to stack the mail, or one side of the bin
is lowered. Neither was done, the tape showed. Northwest, like other
airlines, carries millions of pounds of mail every year under contract to
the Postal Service. ''We are concerned their behavior tarnishes the hard
work of their fellow employees who handle millions of packages every year
and do so with the care & concern," said Northwest.
- Busted......... as a FedEx contract driver took packages he was
supposed to deliver & gave some of the items to relatives as Christmas
presents. Russell Carnes, 29, allegedly stole packages worth about US$14,000
from Oct. to Nov. He pleaded no contest to a charge of grand theft in
Riverside, California. Family members tipped deputies after becoming
suspicious when Carnes gave them boxes bearing the shipping company's logo.
FedEx launched an internal investigation when packages appeared to be
missing & about US$6,500 worth of goods were recovered after Carnes'
arrest. In exchange for his early plea, Carnes will serve 180 days in county
jail, pay restitution & be placed on probation for 5 years. Stolen
items included books, about 50 video & computer games and an ultraviolet
measuring device intended for Edwards Air Force Base. Good thinking, steal
the Air Force ultraviolet measuring device. They'll never notice!
- Figure The Passenger's DIM......... as if an airline determines
that a passenger is big enough to fill more than one seat, it can charge for
more than one ticket, a judge ruled this month, dismissing a lawsuit against
Southwest Airlines. Cynthia Luther, who weighs more than 300 pounds, alleged
that Southwest harassed & discriminated against her in May before she
boarded a flight from Reno, NV., to Burbank. Luther was asked if she needed
a seat belt extension, then was told to buy a 2nd ticket ''so as not to
inconvenience other passengers seated next to her,'' her lawsuit stated. A
friend bought the extra ticket, but Luther sat in one seat with the armrest
down, ''with another person seated next to her in a comfortable position,''
according to the lawsuit. L.A. Superior Court Judge Marilyn Hoffman said the
airline's policy wasn't discriminatory. ''The procedure & policy is
directed in any situation where it appears for whatever reason a passenger
might significantly encroach on another passenger,'' counsel for Southwest
said. Southwest Airlines
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Written from wire stories, the Associated Press,
Reuters, Hong Kong Shipping News Lloyds & other world sources.