For Jettainer, 2022 has been another successful year, serving existing customers and winning new clients. It has enhanced relations with existing clients and new clients include budget airlines and freighter operators.
Among existing customers, Etihad Cargo has enhanced its relationship with a new long-term contract and will embrace a fully digitised ULD fleet.
In Asia, South Korean budget airline T’Way will receive integrated ULD services for its new widebody fleet, and Vietjet will receive Jettainer’s support for its A330 fleet.
In the Americas, cargo airlines Avianca Cargo and AeroUnion will be provided with customised ULD fleets, and Delta will use the cool&fly product.
In Europe, CMA CGM Air Cargo, logistic giant CMA CGM’s new cargo airline, and start-up budget airline Norse Atlantic Airways have both signed up with Jettainer.
Looking into 2023, Managing Director Thomas Sonntag predicts that the industry will face supply chain difficulties, and Jettainer has prepared for this.
He says, “We work very closely not only with our customers, but also with ULD manufacturers to respond early and quickly to changes in demand, so that we can always provide the required ULDs in their networks and in locations beyond.”
2022 was a very positive year, and Jettainer has very ambitious plans, especially in Asia where the company will focus on its presence in Singapore and Hong Kong.
Sonntag says, “Many airlines are expanding their business and new carriers are being established. There is a lot of momentum in the region. As ULD management in Asia has traditionally been managed in-house, the region holds great growth potential for Jettainer and our ULD management solutions, which are based on the exact needs of the various markets.”
Efficient ULD management requires the right IT systems, and Jettainer has improved its JettWare landscape with the new generation, JettWareNG, improving workflows and the user experience.
New APIs allows Jettainer to integrate with customers faster and more flexibly, says Chief Sales Officer Thorsten Riekert, allowing for more customised onboarding for ULD Select clients and it simplifies the onboarding of plug&fly customers.
Automation of workflows has been brought to the next level, which is more than digitising manual processes.
Riekert says, “We are all confronted with an ever increasing amount of data. Automated and AI-supported workflows help to structure this data and turn it into real insights. Once again this helps to optimise our ULD management solutions for our clients – economically and environmentally.”
Customer ULDs are equipped with Bluetooth Low Energy tags where it will provide benefits.
Expanding the reader infrastructure beyond the airport makes the technology more efficient and enhance the data with additional information, says Riekert.
Geo-redundancy is being enhanced so that operations can be maintained even in the event of disasters or widespread and prolonged power outages.
The challenges of 2022 showed that inflexible off-the-shelf solutions are not the answer, with resilience and flexibility proving essential.
Riekert says Jettainer can offer customers a reliable alternative when standard solutions are not the answer, and it works with customers to counteract bottlenecks such as steering ULDs from outstations to hubs in time for peak periods.
He says, “In addition, all ULDs that can be repaired are reconditioned within the global repair network and fed back into the networks as quickly as possible. The proper handling of ULDs is also a very serious issue for us. It is of great importance to raise awareness that ULDs are a valuable resource and to avoid damages caused by improper handling.”
Sonntag is confident that the industry will recognise that ULDs are a valuable resource. ULD management is central to an airline’s service delivery, but it remains a non-core task for them, he says.
He says, “Achieving transparency will therefore remain a challenge. We do create comprehensive transparency. Handing over this segment in professional hands will thus become even more attractive.”
ULDs will become more data-driven, predicts Sonntag, who says, “The possibilities of innovative IT solutions, such as those we already offer and are constantly developing by using AI, digital twins or BLE, provide a significant increase in efficiency, especially for complex control tasks – and they lead to more transparency. This will become the norm.”
Long-term winners
Kings of short-term leasing, ACL Airshop is signing more long-term contracts with clients. CEO Steve Townes and Chief Financial Officer James Harris explained more at the TIACA Air Cargo Forum in Miami.
Joining in November 2021 following a career primarily in the oil industry based in Houston, Texas, moving to ACL Airshop was an industry change for Harris, but the team quickly brought him up to speed.
The company’s change from focusing primarily on short-term leasing to long-term contracts means more stable earnings as the industry cycles through its ups and downs.
“We have had a lot of success signing on new and existing customers to long term contracts. It’s a win-win for customers and for ACL Airshop, we provide a competitive day rate for the ULDs but also offer repair services, nets for pallets and other services included within the long-term contract at very attractive rates,” he says.
This is appealing to customers who have a baseload of requirements that they know they are going to have; leasing under a long-term contract makes economic sense for them, says Harris.
Harris joined in the middle of super-peak, handling volumes it had never seen before, which is good for company results but stretches systems.
Business processes and systems are being evaluated so ACL can scale and continue to grow.
He says, “It will take some changes in technology, which we will be investing in over several years as we round out those capabilities.”
Supportive backers in Astatine Investment Partners have been of great help, with Harris commenting, “We have found Astatine Investment Partners to be a very supportive partner. Of course, they want a solid business case for what we are doing but they have been supportive of us making investments.”
E-commerce has taken a dip but the long-term prospects are good. Townes pointed out that, excluding shocks and blips, long-term growth has averaged 4% for the last 20 years.
Covid created a dividend as the industry responded, and now it is slowing down back to where it was before.
Starting in the aviation industry 42 years ago, in strategic planning at an over-$9billion conglomerate that included the giant Vought Aerospace manufacturer, Townes has seen similar numbers and graphs every year for four decades from experts such as Boeing, Airbus, and Merrill Lynch, many others.
Townes says, “The occasional shock and blip, I have lived through all of it, through the Internet bubble meltdown, the Great Recession, the oil shock of 1990. I have seen a lot of the ups and downs and experienced how it has affected various sectors of aerospace including air cargo. We always pay attention to the trends, and we always try to correctly. But if you stand back from the entire time spectrum and look at the worldwide industry, it is likely to return to 4% average real growth due to demographics, world trade, emerging economies, and e-commerce.”
For 2022, ACL Airshop will post a strong rise in revenue and profitability as it pivoted with its customers.
“We rode the Covid dividend along with our customers. It is fair to say no tree grows to the sky, and now the market is normalising,” says Townes.
A year ago, Townes was predicting super-peak, and reported it was “super-peak all year.” To cope, growth capital investment was more than doubled to $18 million, to which Townes was grateful to the $5 billion majority shareholder.
Customer facing processes were improved, making better and faster decisions, with Townes commenting, “We didn’t double our costs, but we certainly doubled our pace.”
Speed and responsiveness are what customers appreciate. Townes says, “In our company, a manager in any one of our stations around the world can make a spot decision in favour of the customers and they will get backed up all the way to the top. Guess what, we have never broken the bank doing that.”
Performance during the current peak season will impact the pull-through momentum into 2023. Townes would be delighted if the company could simply stay even and repeat its performance from this year.
“Time will tell,” he said with a determined look.
Technology investments will continue with the ending of ACL’s Beta testing of linking air waybills to the ULD to Bluetooth apparatus, which will be a game-changer as it can tell you what is in the container and on the pallet.
“This development will add efficiency and increase the speed of customer-facing information to shippers.”
Townes says it will take time to be rolled out and gain traction but will give carriers the same end-to-end efficiency and information that people everywhere have become accustomed to in the world of e-commerce.
With the new majority shareholder, ACL had to adjust and gear-up for the new backers. That is something Harris has been helping with, making sure ACL does not grow too fast.
“Astatine are sophisticated investors who will ask questions about the returns from their investments so comprehensive cash flow models were made for proposals. Thus, Astatine could understand and approve the investments. Once the investment is approved, the commercial team can collaborate with the customer to sort out the commercial transaction that works for both sides.”
Harris says, “It was a big change. Most of the contracts done previously were short term, which the company was very good at doing. Long-term contracts take longer to negotiate and develop. That was a change for the team but they have adjusted successfully. Once they had the formula and the ability to know what we could offer, they took that up enthusiastically.”
This article was published in the December 2022 issue of Air Logistics International, click here to read the digital edition and click here to subscribe.