Settling into its new home in Miami after years of travelling the world, the TIACA Air Cargo Forum was the place to exchange knowledge and do business.
Director General Glyn Hughes welcomed delegates at the Opening Plenary, saying much has changed in four years, claiming he had a full head of hair four years ago (he didn’t, nor did he own a comb).
Something that has not changed is the great people in the industry, who guided their businesses, and the industry, through the most challenging time the world had ever seen, inviting the audience to give themselves a round of applause.
Thousands of people had registered for the event but Hughes joked that Hurricane Nicole, who was floating around the Bahamas at the time, was not welcome. Nicole did not cause issues in Miami.
Distinguished guests attended the opening including the Mayor of Miami Beach, Dan Gelber, Ralph Cutié, President and CEO of Miami-Dade Aviation Department, Jimmy Morales, Chief Operating Officer for Miami-Dade County, and Oliver Luksic, Parliamentary State Secretary from the German Federal Ministry of Digital Affairs and Transportation.
Steven Polmans, Chairman of TIACA followed Hughes on stage to praise how the air cargo industry coped during the pandemic, and how the pandemic forced the industry to change the way it worked and did business.
One victim of Covid was the inaugural ACF in Miami, which should have been held in 2020 but Polmans hopes the show will return to Miami for many editions in the future.
Covid is no longer the issue it was, and it is time to look forward, said Polmans, adding, “Let’s not forget the last few years, there were many things we learned and lessons that were taken but the future is ahead of us but hey, we can meet again. We can, altogether, start shaping that future, a better future; people interaction and collaboration have always led to an improvement and better results.”
Ending his welcome, Polmans suggested the distinguished guests should sing Welcome to Miami by Will Smith on stage but they were unwilling for some reason.
Polmans was preparing to do a solo performance before a dramatic intervention from Hughes, who claimed Will Smith had been on the phone and there were concerns that the Mayor would ban the show from Miami.
It was not disclosed whether Will Smith had threatened to slap the song’s name out of Polmans’ mouth.
From Messe München, Robert Schönberger, Director transport logistic exhibitions said the pandemic was very hard for an event organiser, saying people predicted that there would be no more trade shows.
Luckily, they were wrong, the show was bigger and better, with a doubling of exhibition space compared to the 2018 event in Toronto.
Welcoming delegates on behalf of the county and the airport, Cutié said the pandemic gave people a real appreciation for air cargo and global supply chains.
Miami International Airport is the number one US airport for international freight and number nine in the world, and has posted three consecutive years of record-breaking volumes, with 2.9 million tons predicted to pass through the airport this year.
His boss, Morales, was next on stage, who reinforced how important cargo is for the Miami area, making up for the hit that the tourism and hospitality industry took during the pandemic.
“When our airport was empty and our cruise ships were not even sailing, it was cargo at both facilities, particularly at MIA, that helped us get through this. As a result, we are acutely aware of the profound impact your operations have on both the economy and social well-being of communities not just here in Florida, but around the world,” he told the audience.
Imports and exports at the airport were worth over $67 billion in 2021, 95% of the state of Florida’s air trade value and 41% of the state’s air and sea trade value.
Airport operations support 275,000 jobs in the local economy and nearly 700,000 state-wide. Using the famous phrase, “It’s the Economy, Stupid”, cargo drives the economy. The significance of hosting the ACF was not lost on Miami.
Dark clouds
Sander Schuringa, Commercial Manager of Seabury Cargo was next to offer an economic update, who admitted times were tough with high inflation driving down consumer spending, operational issues in China, and yields dropping significantly over the last few months.
There was still room for optimism as yields are well above pre-pandemic levels, capacity is returning, operational issues are easing and a record number of cargo aircraft are on order.
Yields were a focus area; having stayed stable pre-pandemic, rates shot up to unprecedented levels and were up and down during a year and a half of insecurity and have been coming down gradually since the start of this year.
Looking at capacity, passenger widebody capacity is still about 29% down on pre-pandemic levels but total capacity is only down about 6%.
The number, type of aircraft and operators have changed; belly capacity has fallen from half the total to around a third, with freighters filling the gap.
Ocean shipping lines have entered the air cargo market, and while their contribution to capacity is limited, their growth is strong.
Sea freight is impacting air cargo, which is expected to add 10% capacity in the next three years, potentially creating another perfect storm, Schuringa said.
“What we see in both the ocean shipping industry and the air cargo industry is that rates have dropped massively. You can see that we are still well above pre-pandemic levels. Depending on the way you see the industry, you can either see that we have dark clouds over our industry but we still believe that there is room for optimism,” Schuringa concluded.
CEOs talk
When the good times will return was a talking point of the CEO roundtable, with Sanjeev Gadhia of Astral Aviation being confident about 2023 although Tim Strauss of Amerijet International admitted he had no idea, suggesting 2025 was the year and that players will have to adapt to the market.
Gabriel Oliva of Avianca Cargo also had no idea, Tobias König of Rhenus Logistics suggested after Chinese New Year, and Audrone Keinyte of Bluebird said there are opportunities and e-commerce continues to grow.
Astral Aviation is investing in its fleet, with Gadhia telling the audience that the fleet will double in three years from its current 15 with Boeing 767-300s and 777-300s on order, and he is proud to be the first airline to acquire Airbus A320Fs, which will be followed by A321Fs operating out of India.
The airline has signed up for two A330-300s, which has the right volume to payload ratio for products like flowers, but Astral will have to be patient because of the backlog for conversions.
Astral has also signed up for two Embraer E190Fs with 12 tonnes of capacity to serve the intra- African network.
Amerijet is investing in its fleet, and Strauss admitted that the board are regularly asking about plans for the new arrivals.
Five 767s were supposed to be delivered about eight months ago, and Strauss said eight months ago, it would have looked brilliant, today, less so, but this is just part of the challenge of the air cargo industry.
He said, “We are playing the long game, we want to have the aircraft in our fleet when the market comes back so we don’t have to wait two years to get aircraft.”
Amerijet’s fleet is expanding, but the challenge is not getting aircraft, it is finding the staff. They need to be trained and each new aircraft requires a lot of people so it can fly.
“We partner with Florida International University’s logistics and supply chain school. We will take in 30 interns over the next 12 months and bring them into the organisation because finding good employees is hard. As we all know, you either get into this industry and love it or get out fast,” he said.
The CEOs were asked what they would like to see and expect to see when the ACF returns to Miami in 2024, giving the answers of greater diversity, unmanned operations, streamlined and paperless processes, and a more stable market.
Giving the forwarder’s view, König said, “I would like to see the market normalise again, back in the new normal with all the crises in the market over, and we really have a solid service with our airfreight partners for our customers at a reasonable rate, making airfreight one of the most solid services we can offer our customers.”
Airport development
Expanding and having facilities fit for the future was up for discussion in the session “Airports – Conducting the Orchestra”, moderated by Mike Webber, President of Webber Air Cargo, who said that 30 years ago, airports were a passive landlord who charged a ground rent and sometimes developed the facilities.
This developed into a third party phase where developers would develop facilities, and now it is a private-public partnership.
Emir Pineda, Director of Marketing and Air Service Development at Miami International Airport explained how the planned vertical facility, the VICC, similar to Hactl’s facility in Hong Kong, will add 1.4 million square feet of highly automated space, which will be essential as the airport is near capacity.
When it starts, the VICC will be the largest cargo infrastructure project in the Americas valued at $2 billion from the private sector with no money from the airport.
“If we are going to grow in the future, this is the type of long-term infrastructure project that is required by the airport to stay competitive and ahead of the cargo growth that is anticipated over the years,” said Pineda.
Steven Polmans joined Abu Dhabi Airports as Vice President Business Development and Regulatory Affairs earlier this year, and admitted that facilities in Abu Dhabi need a big upgrade.
This is happening with a 70,000 square-metre automated facility and there is a focus on the whole ecosystem.
Polmans said it is important to remember that airports are all unique, and they need to focus on the conducting part, remembering there are different instruments and tunes they can play.
Pushback against airport development is an issue, at which point, Anne Marie van Hemmert, Head of Aviation Business Development at Amsterdam Airport Schiphol jokingly asked if she could leave.
It was announced earlier this year that Schiphol would have to reduce its slots from 500,000 a year to 440,000 by the end of 2023.
A firm decision needs to be confirmed, so the plan is unlikely to start before 2024 but the announcement had a serious impact on confidence.
She said, “Together, with the community, we are making a plan and coming up with a strong voice against the government, explaining what they are doing and the impact for cargo in the Netherlands, and not just locally for Amsterdam.”
When it comes to cargo communities, Europe has led the way, and in his previous role at Brussels Airport, Polmans had significant experience.
To add capacity, you can add a new terminal but this is not always the answer, efficiency is key. Through better management of trucks in Brussels, efficiency increased more than 60%.
“In our personal lives, why do we use mobile phones? It’s easy, convenient and efficient. The question is not why digital but why not,” said Polmans.
Inspired by Brussels Airport’s BRUcloud, Dallas/Fort Worth International Airport launched a similar system using Nallian just before the pandemic, so it had to be rolled back.
Vice President Airline Relations/Global Strategy Development, Milton De La Paz admitted it was not a case of build it and they will come, so the airport needs to drive change, which DFW has had some success doing.
Starting with slot management for truckers, there are now 250 users and there is still a long way to go.
“If you decide to go this way, you have got to roll up your sleeves and dig in because it is not just going to happen by putting it out there,” said De La Paz.
See you in 2024
Over the three days, 5,900 visitors from 78 countries came through the doors, and there were 220 exhibitors, not just from North America but from across the world.
Miami exports memories and visitors will remember the 2022 event as a key show for networking, new business and sharing knowledge.
To those who did not attend because they thought TIACA was finished and the Air Cargo Forum had lost its relevance, you missed out on a great event.
This article was published in the December issue of Air Logistics International, click here to read the digital edition and click here to subscribe.