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
- Stop The Mergers, But ......... as
Sen. Charles E. Schumer, D-N.Y. has urged the U.S. Dept. of Justice to
impose a 9 month moratorium on airline mergers. Schumer also called on the
Justice Dept. to study how airline industry consolidations would affect
airline competition. The Justice Dept. was also asked to review the way it
evaluates airline mergers to make sure it considers the effects of
consolidation in the industry over the last 10 years. BUT, Schumer voiced
his support for American Airlines proposed acquisition of TWA. This
transaction should not be included in the moratorium because of TWA's
looming bankruptcy threatens to force the airline out of business, he said.
- There May Be A New TWA Suitor......... as
a new company formed by aviation experts & investors said Feb. 7 it
would bid nearly US$1B to acquire Trans World Airlines, doubling the amount
American Airlines said it would pay to take over the troubled carrier. Jet
Acquisitions Group Inc. of Scottsdale, Ariz., wants to eliminate TWA's
current debt, retain most of its current employees, modernize its facilities
& eventually expand the airline. But TWA pilots are officially behind
the proposed merger with American Airlines. The pilots, represented by the
Air Line Pilots Association, submitted their official support on Feb. 16 to
the U.S. Senate Committee on Commerce, Science & Transportation. The
pilots said the American buyout provides job security and protects medical
& retirement benefits for pilots and other TWA employees. ALPA
represents about 2,300 TWA pilots. Good luck in saving America's oldest
- Industry Slowing.........as
more than a quarter of flights on major airlines arrived late last year --
the worst record in 5 years, the Transportation Dept. said. Planes arrived
late 27.4% of the time in 2000, 3.5% worse than the year before & the
largest percentage of delays since the department started collecting this
kind of data in 1995, according to the department's Air Travel Consumer
Report. United Airlines had the worst on-time arrival record of any major
U.S. airline in 2000 with nearly 39% of its planes pulling in late.
Continental was the most punctual airline of 2000, arriving on time 78% of
the time. It was followed by Northwest & TWA.
- DP OK To Go Alone.........as
the German government has decided to extend the letter delivery monopoly
held by Deutsche Post AG past a 2002 deadline for deregulation previously
enacted into law in Germany. The German economic ministry said it will
extend the monopoly because other EU countries have not agreed to mail
deregulation plans. EU members have argued over postal deregulation since
the beginning of last decade. Recent setbacks have again stalled the
liberalization process. Despite its recent Int'l expansion, postal delivery
is still by far Deutsche Post's largest business. Mail alone accounted for
34.3% of the company's revenue and more than 76% of pretax profit in 1999.
The monopoly extension will likely lead to more complaints from Deutsche
Post rivals UPS, FedEx, & TNT Post Group. UPS has been fighting EU
authorities for several years to penalize Deutsche Post for unfair business
practices. Most recently, UPS has complained that Deutsche Post funded
recent acquisitions with revenue earned from its monopoly mail business,
breaking EU competition rules.
- DHL Says Back Off......... as
the California based cargo airline has urged the U.S. Dept. of
Transportation (DOT) to dismiss complaints filed by its larger rivals, UPS
& FedEx, which have asserted that the airline fails to comply with U.S.
regulations regarding foreign ownership. In its formal answer to the FedEx
& UPS complaints, DHL described its rivals' assertions as `both
factually & legally groundless'. American investors retain ownership,
management control & the majority of the equity of the airline, DHL said
in its DOT filing. But FedEx is demanding that Washington hold a public
hearing about actual control of DHL Airways by the heavenly subsidized
German state company Deutsche Post. According to FedEx, Deutsche Post is
using its state post monopoly to finance global operations. Read the JOC
- DHL Says Two Can Serve U.S. Post......... as
it says the FedEx-U.S. Postal Service (USPS) alliance will not have an
effect on an existing DHL Airways-USPS alliance. DHL Airways began its
association with USPS in 1999 with a service called Global Express
Guaranteed, while FedEx has been given a contract by USPS to handle domestic
air transport of priority & express mail. The USPS this month introduced
Signature Confirmation, a delivery information service in which customers
are provided with a copy of the recipient's signature on request. USPS Web
site customers can request the signed delivery record faxed or mailed to
them. Signature Confirmation will also provide complete delivery info by
phone or online, by providing the recipient's name, in addition to delivery
date & time.
- IATA Chief Calls For Change......... as
"A well-known business magazine recently described the airline industry
as "America’s most successful disaster." Perhaps we are simply
the victim of our own success" said IATA Director General Pierre J.
Jeanniot. "But certainly our customers must not become victims. We must
tackle head-on the critical issues of infrastructure capacity, environment
& safety, in order to meet the expectations of today’s and tomorrow’s
air travelers & shippers." Jeanniot delivered his remarks to an
audience of senior aviation professionals at the Int'l Aviation Club of
Washington, D.C., on 14 Feb.
- The Battling Bickersons Continue......... as
at private talks with the Italian Treasury ministry in Rome, KLM Royal Dutch
Air representatives have been demanding that they head an alliance with
Alitalia. KLM wants to secure control of the merged company & insists
that, when shares are exchanged, KLM shares should be marked up by between
30% & 35% in relation to their market value. The principal argument for
this is KLM's significantly better trading results. KLM makes a reasonable
profit, while Alitalia incurs heavy losses. A solution will also have to be
sought for Milan's airport, Malpensa, and for the necessary reorganization
of the Italian state-owned company. Earlier plans by the airlines to join
operations were scrapped last year because of disagreement (indeed
threatened lawsuits) about Alitalia's privatization & logistical
difficulties at Milan's Malpensa airport.
- A New Breed......... as the
1st Boeing 757 Special Freighter (SF) lifted off Feb. 15, after undergoing
passenger-to-freighter modification at Boeing Airplanes Services' Wichita
facility. It is the 1st of 44 airplanes Boeing Airplane Services is
purchasing, converting & providing to DHL under a multiyear arrangement
as part of a total fleet management solution. The B-757SF modification
involved the removal of the passenger furnishings, installation of a side
cargo door, replacement of selected floor panels to strengthen the main deck
floor, & installation of a cargo handling system. The B-757SF will be
capable of carrying 60,000 pounds of cargo more than 2,000 nautical miles
with a volume payload capacity of more than 8,000 cubic feet (226,535 cubic
- Greece Defends Spata Schedule .........
as on Feb. 9, it attacked the Int'l Air Transport Association (IATA) for
requesting a delay to the opening of a new Athens Int'l airport, planned for
March. IATA said the opening of the new airport -- 'Eleftherios Venizelos'
-- at Spata, northeast of Athens, must be delayed until its road connection
with the capital is completed & the cargo, catering & aircraft
maintenance facilities are ready. IATA Director General Pierre Jeanniot
expressed "major concern" over delays, including aircraft
maintenance, cargo & catering facilities. 'The statement is
danger-mongering," said a top Greek official. IATA, which links 274
airlines, spoke after an inspection visit of the US$1.83B airport at Spata,
which will replace the outdated & congested Hellenikon airport, on
Athens's south coast. Airlines have complained about the higher fees they
will be asked to pay when they switch from Hellenikon. Spata officials have
said the cost would double but users would get much better services.
- Our LAX Home Continues Lead In Americas.........
as Los Angeles World Airports reports record cargo levels
with an all-time high of 2.24 million tons of cargo handled last year.
"LAX is the United States' main entryway for travelers & goods to
and from the Pacific Rim region," said John Agoglia, president of the
Los Angeles Board of Airport Commissioners. Last year air cargo (freight
& mail) increased 5.18% from 2,138,221 tons in 1999 to 2,249,000 tons in
2000. Aircraft movements (takeoffs & landings) at LAX were up by only
0.55% to 783,433 in 2000 from 779,150 in 1999. LAX is the largest final
destination cargo port in the Americas. Meanwhile, crime at LAX dropped 9%
last year -- the 4th consecutive year of decline.
- Peru Now Private......... as
Lima Airport Partners S.R.L., a consortium comprising Fraport AG (Frankfurt
Airport Services Worldwide), the U.S. construction firm Bechtel Enterprises
Int'l Ltd., and the Peruvian construction company Cosapi S.A. -- officially
took over Lima's Aeropuerto Int'l Jorge Chavez (LIM) on Feb. 15. The
Peruvian government privatized Lima Airport last Nov. when it awarded a
30-year concession for Lima Airport to the Fraport-led consortium.
- Pilots Hit Snooze Alarm......... as
the Coalition of Airline Pilots Associations (CAPA) has petitioned a federal
court to intervene in a lawsuit that would overturn an FAA interpretation of
a rule prohibiting pilots from being on duty for more than 16 hours a day.
Commercial pilots have expressed growing concern over industry
interpretations of FAA regulations that result in pilots being on duty for
periods far in excess of 16 hours. Pilots cite fatigue as a major threat to
air safety. CAPA, representing 26,500 commercial pilots, filed its petition
in the U.S. Court of Appeals for the District of Columbia, seeking to
intervene in a lawsuit brought by the Air Transport Assn. (ATA), which
represents the nation's larger airlines. In the lawsuit, ATA seeks to block
the FAA from enforcing an interpretation the agency provided in Nov. in
response to a request for clarification. In that interpretation, the FAA
said that its rules limiting a pilot to 16 hours of duty per day apply to
the actual time a pilot is on duty, including the time added by operational
delays and other "unscheduled" duty time. Most airlines, however,
have rejected that interpretation, and insist that these 16 hours of duty
include only "scheduled" time.
- Danzas Swallows It's Chile......... as
it has acquired the Int'l logistics business of Deca Express SA in Chile.
Founded in 1971, Deca Express served as the exclusive Chilean agent to the
former Air Express Int'l Corp. (AEI) from 1973. Deca Express will be
integrated into Danzas Chile SA, established in 1978. Following the
acquisition, Danzas Chile will be renamed Danzas AEI Chile SA.
- This Time, France Takes Germany......... as France's
postal service, La Poste, said Feb. 15 it had taken full strategic control
of German express delivery company Deutscher Paket Dienst, raising its stake
in the company to 86%.
- Northwest Rates Go North......... as Northwest
Airlines Cargo will impose a minimum charge of US$125 per Trans-Pacific air
waybill on all North America-origin shipments, effective March 16. The
current minimum is US$55. Likewise, the minimum rate for U.S. domestic
airfreight shipments will increase to US$32, up from US$30 now. Northwest
said the fee is consistent with the carrier's strategy of focusing on large
Int'l shipments -- meaning that small shippers should call UPS.
- Northwest CEO Has It His Way......... as John H.
Dasburg (58), who has been pres. & CEO since 1990, has informed the
Board of Northwest that he will become chairman, CEO, Pres. & nite
drive-thru supervisor of Burger King Corp.
- French Warning......... as SAirGroup's French
airline operations chief Marc Rochet has warned staff that the group's
French subsidiaries AOM, Air Liberté & Air Littoral may not survive
after racking up more than FFr2.5 billion US$348M of losses last year.
- MIA Flower Day......... as U.S. Dept. of
Agriculture's Animal & Plant Health Inspection Service closely monitored
the increased volumes of imported fresh-cut flowers for this past
Valentine's Day to ensure they did not contain harmful pests. Each year,
APHIS's officers inspect millions of fresh-cut flowers arriving at U.S.
ports. According to USDA's Economic Research Service, the value of fresh-cut
flowers imported into the U.S. in 1999 reached $592M. That figure is
expected to exceed US$600M in the 2000 figures. Valentine's Day has made
Feb. one of the busiest months for the agency. About 85% of all imported
fresh-cut flowers arrive at Miami from Latin American countries, such as
Colombia & Ecuador. On an average day, 30,000 boxes of flowers pass
through Miami's Int'l Airport, but the numbers more than doubled for
- KAL Pays For Cargo Crash......... as South Korea's
flagship carrier Korean Air has begun paying dozens of Shanghai families
compensation for damages caused by a crash of its cargo jet in April 1999 in
accordance with a Chinese court's ruling. On Dec. 26, a Shanghai court
ordered Korean Air (03490.KS) to pay 80,000 yuan to 120,000 yuan (US$14,500)
each to 33 families whose homes were damaged when its MD-11 freighter
crashed on a construction site. The Korean freighter plunged into the ground
shortly after take-off, killing 9 people, including all crew members, &
injuring more than 30.
- Ice Heist ........ as a Swiss newspaper carried an
advertisement on Feb. 7 offering a US$301,800 reward for information on the
whereabouts of a pink diamond that vanished on its way from Geneva to South
Africa. The 162.5-carat stone, described by one expert as "of
incredible purity & extremely rare," went missing during its
transport from Geneva to Johannesburg via Zurich airport last month. Worth
at least 10 million francs before it is polished, the raw diamond made it as
far as Zurich but never arrived in Johannesburg as planned. Brinks Security
officials declined to comment on the case, as did the person who answered
the phone at the reward hotline. It is not clear who owned the 32.5-gram
(1.146-ounce) rock, why it was on its way to South Africa and even where it
had been discovered. Lloyd's of London denied a report that it had engaged a
special firm of "diamond hunters" to find the stone.
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Written from wire stories, the Associated Press,
Reuters, Hong Kong Shipping News Lloyds & other world sources.