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Top 50 cargo carries: cargo's cream of the crop.

It's been a rough 2011. In the past eight months, the world has watched in horror as a magnitude-9.0 earthquake and a subsequent tsunami ravaged Japan in March, a series of tornados devastated the Southern U.S. in April, and the eruption of Iceland's Grimsvotn volcano in May halted air traffic. In an ongoing crisis, residents of the Horn of Africa face mass starvation and famine.

Adding to this bleak picture are the economic instability and political unrest experienced in many parts of the world. It has been so bad, in fact, that many sectors have lost significant profitability and have seen cuts in every corner.

Unfortunately, the airfreight sector is not immune to these hardships. In addition to contending with the flight implications of the aforementioned natural disasters, carries have lost considerable market share to other modes of transport. In fact, sea-freight and trucking have emerged as less-costly options for budget-burdened freight forwarders, although the tradeoff in speed is a clear disadvantage.

Despite these concerns, the airfreight sector is still a viable mainstay in the logistics industry, IATA officials contend. It's a point illustrated in the association's list of the most prolific cargo carriers in 2010, a ranking taken at an equally trying time for the air cargo industry.

FedEx, which took top honors, led the pack in both the international and domestic categories, transporting a combined total of 6.94 million tonnes last year. Trailing FedEx were UPS Airlines and Korean Air, carrying 4.5 million tonnes and 1.8 million tonnes in 2010, respectively. Emirates and Cathay Pacific Airways ranked fourth and fifth among cargo carriers last year, posting respective tonnages of 1.77 million tonnes and 1.57 million tonnes.

IATA representatives point to the strong growth in the Asia-Pacific, Middle East and Latin American sectors as highlights of last year's air cargo climate. This growth speaks volumes about the strength of the airfreight sector amid a challenging global landscape, industry insiders say. It also causes experts to take a closer look at what makes certain carriers stand out from the rest.

Although other attributes are cited, the top five carriers of 2010 share three main goals: reducing fuel consumption, investing in sustainable technologies and adhering to ever-changing security regulations.

Lowering consumption

If there's a common refrain among carriers, it's the increasing burden of fuel prices. With the cost of oil exceedingly high, carriers have seen their financial statements take a nosedive. In fact, according to IATA data, airlines spent $139 billion on fuel last year, a $14 billion rise from 2009. Fuel also comprised more than one-quarter of carriers' total operating costs in 2010.

Fuel is why carriers are so concerned about maintaining a full payload, UPS Director of International Airfreight Marketing Scott Aubuchon explains. "The primary reason UPS has been able to stay profitable despite rising fuel costs is efficiency and technology," Aubuchon says. "With our access to such a large network of planes and transportation modes, we are not forced to fly half-full cargo planes."

He also cites UPS' investment in Automatic Dependent Surveillance --Broadcast technology on all of its B757 and B767 craft as key to its profitability. Crediting this aircraft-spacing technology with saving 1 million gallons of fuel in a year, Aubuchon says that UPS was the world's first carrier to deploy it.


"We were also the first U.S. based carrier to use the LIDO flight planning system, which calculates the most efficient flight path between two points based on outside factors, such as weather and terrain," Aubuchon says. "And our Worldport hub [at Louisville International Airport in Kentucky] utilizes Surface Management System software, which monitors the ground movements of our aircraft, saving an estimated 400,000 gallons of fuel a year from taxiing."

Competitor FedEx is also undertaking initiatives to reduce fuel consumption. In addition to operating fuel-efficient Boeing 777Fs on its international routes, FedEx has announced plans to procure even more of these aircraft in fiscal year 2012, an investment valued at $4.2 billion.

FedEx President and CEO Fred Smith says that his company is also scrupulous about ensuring demand meets capacity. "Unlike our competition, the 777s fly nonstop from Asia to the contiguous U.S. with a full payload," he says.

Still, Smith doesn't discount the impact fuel prices have had on carriers' bottom lines. Acknowledging that such costs have impeded airlines' growth, he says that the problem is subsiding as fuel prices continue to fall from their April high.

But if there's anything good that has come from the worldwide focus on fuel prices, experts say, it's the research into alternative, sustainable fuel sources.

Promoting sustainability

To decrease their dependency on oil, officials from many carriers are investing in the development of biofuels. But biofuels, which blend jet fuels with algae fuels, promise more than just cost-savings; they also save considerable resources. According to Boeing estimates, such technologies could lower airlines' carbon emissions by a whopping 60 percent to 80 percent. And despite still being in the development and testing stages, IATA is fully championing their usage.

Before handing over the reins to Tony Tyler, IATA Director General Emeritus Giovanni Bisignani spoke out about biofuels, calling for worldwide regulations to propel their deployment. "Governments need to come on board and set a fiscal and legal framework to support growth in the biofuel industry and ensure that aviation will have access to adequate supply," Bisignani said at the time.

Whether his wish is granted in the near future or not, one thing's for certain: Airlines are increasingly concerned with promoting sustainability. It's an objective echoed by the top five cargo carriers on IATA's list.

Ram Menen, divisional senior vice president of cargo at Emirates Airline, says environmental responsibility is part of his corporate culture. "Our focus is becoming an ecologically efficient organization--growing our business to be economically sustainable, while using fewer resources and creating less waste and pollution," he says. "Emirates' commitment to eco-efficiency means multibillion-dollar investments in the most modern, eco-efficient technology available--in aircraft, engines and ground equipment."

No. 5 carrier Cathay Pacific also devotes resources to economic sustainability, maintains James Woodrow, general manager of cargo sales and marketing for the airline. Along with placing orders for 97 fuel-efficient planes, including 10 747-8Fs and eight 777-200Fs, Cathay is spearheading initiatives to reduce its carbon footprint, Woodrow says.


One of these endeavors is searching for a sustainable and cost-effective energy source, Woodrow says. It's a push Cathay Pacific "emphasizes in every aspect of our day-to-day operations," he says.

FedEx officials aspire to make biofuels 30 percent of the firm's jet fuel use by 2030. Although lofty, it's an initiative backed by some of the biggest names in aviation, Smith maintains. "We are working with the [Federal Aviation Administration], the Department of Energy and the Commercial Aviation Alternative Fuel Initiative to develop certification standards for biofuels," he says. "We're also collaborating with the U.S. Department of Agriculture and other agencies."

Security challenges

The initiative now has a proposed deadline: December 31. The U.S. Transportation Security Administration has tasked the global aviation industry with screening all U.S.-bound cargo on passenger aircraft by the end of the year. It's a feat the TSA already accomplished on all freight originating in the U.S. via airline screening and its certified cargo screening program, as mandated in the 9/11 Act of 2007.

Although the TSA's Jim Fotenos has been quick to point out that December 31 is a guideline--not a mandate --this push for tighter security is casting carriers into the spotlight.

Woodrow endorses this initiative wholeheartedly. In fact, he says, "Cathay Pacific stringently applies all the regulations applied by the various government bodies around the world, including the TSA."

Another carrier with a strong focus on security is Korean Air. Chan Ho Lee, a member of Korean Air's cargo strategy and alliance team, says his employer goes to extreme means to prevent any safety breaches. In addition to complying with industry ordinances, Korean Air regulates itself beyond protocol, Ho Lee says.

Safety is promoted throughout the carrier's cargo terminal at Incheon International Airport. Korean Air also recently installed a new X-ray machine and explosives trace detection system to add other layers of security to cargo screening. It's a practice Korean Air takes very seriously, Ho Lee explains. "We make every effort to prevent dangerous situations from occurring," he says.

The other freight carriers topping IATA's list also hold Korean Air's view on security. UPS, for instance, complies with all FAA and European regulations, including the European Community Customs Code Import Control Systems, which was launched earlier this year, Aubuchon says.

UPS and competitor FedEx might get a further push as the TSA and other regulatory bodies contemplate applying the 100-percent screening guideline to freighters. Whether or not industry rumblings prove correct and this happens, however, it's safe to say that antiterrorism initiatives are here to stay.


Future projections

None of the representatives for the carriers topping IATA's list deny the blows being dealt to airfreight operations. Ho Lee, for one, points to how the current economic climate is cutting into airline's profits. "Uncertainty and depression of the world economy is one of the biggest challenges to airfreight carriers right now, and depression leads to decreases in purchasing power and air cargo demand," he says.

Emirates' Menen concurs. Citing how recent natural disasters have impacted supply chains, he says certain sectors, such as high-tech goods, have been hit harder than others. The political strife plaguing the Middle East has also disrupted freight operations, he says.

Despite the bleak picture, cargo carriers remain optimistic about the future. "Going forward, we see stronger economic growth," FedEx's Smith projects. "We believe the industrial sector will lead growth in the U.S. and overseas in the next two years, supporting shipping demand."

Smith, along with the rest of the industry, is also eyeing Asia as a key region for growth. Crediting Asia with housing FedEx's strongest transportation network, Smith anticipates this continent playing an increasingly important role in his company's airfreight business.

It's a projection echoed by IATA. Association officials expect the Asia-Pacific to post the highest cargo growth of any region in 2011. To Bisignani, this success is attributable to a number of factors, namely Asia's 40-percent market share in the airfreight industry. "Asia has policies to promote and support growth," he said at IATA's 67th Annual General Meeting in June.

What's more, he anticipates the Asia-Pacific overtaking both Europe and North America as the global aviation hub in the near future. "In place of our traditional leaders, I'm convinced that China and India will soon become the driving force of aviation in this century," Bisignani said. "They will grow aviation stronger through change, replacing artificial barriers with commercial opportunities."

It's a feat the top 50 carriers on IATA's list hope to accomplish, as well.
Top 50 Carriers in 2010
By scheduled freight-tonnes carried


Rank              Airline *                 Tonnage
                                         (in thousands)

1                 FedEx (1)                  4,985
2             UPS Airlines (2)               2,929
3        China Southern Airlines (3)          833
4               Air China (4)                 625
5        China Eastern Airlines (5)           527
6            Japan Airlines (6)               437
7          All Nippon Airways (7)             419
8            United Airlines (8)              257
9            Hainan Airlines (9)              250
10         Shenzhen Airlines (10)             222
11          Sichuan Airlines (13)             170
12          Xiamen Airlines (14)              155
13          Garuda Indonesia (17)             144
14             Korean Air (12)                144
15         Shanghai Airlines (11)             144
16            Tam Airlines (16)               139
17          Delta Air Lines (19)              131
18           Qantas Airways (15)              126
19          Vietnam Airlines (21)             112
20         American Airlines (20)             105
21            Gol Airlines (NA)                90
22             Air India (23)                  82
23        Philippine Airlines (27)             72
24            Jet Airways (25)                 71
25        Kingfisher Airlines (26)             65
26       Saudi Arabian Airlines (28)           62
27            Thai Airways (29)                57
28             Air Canada (32)                 54
29        Continental Airlines (31)            51
30          Alaska Airlines (30)               50
31     Aeroflot Russian Airlines (35)          42
32          Asiana Airlines (33)               40
33         Malaysia Airlines (36)              39
34               Iberia (34)                   36
35       South African Airways (38)            35
36          Turkish Airlines (37)              35
37         Hawaiian Airlines (41)              30
38         Transaero Airlines (43)             29
39          Siberia Airlines (40)              28
40                PIA (39)                     28
41             US Airways (42)                 25
42            LAN Airlines (45)                24
43              Avianca (47)                   20
44             Aeromexico (46)                 19
45              Jet Lite (48)                  16
46             Lufthansa (44)                  15
47               UT Air (50)                   15
48          Vladivostok Air (54)               12
49           Copa Colombia (NA)                12
50              Iran Air (49)                  11


Rank              Airline *                 Tonnage
                                         (in thousands)

 1                FedEx (1)                  1,965
 2              Emirates (2)                 1,777
 3             Korean Air (3)                1,661
 4            UPS Airlines (4)               1,580
 5       Cathay Pacific Airways (5)          1,579
 6           China Airlines (7)              1,347
 7           United Airlines (8)             1,298
 8         Singapore Airlines (6)            1,149
 9              Lufthansa (9)                1,037
 10             EVA Air (15)                  850
 11         Asiana Airlines (11)              745
 12             Cargolux (10)                 712
 13         British Airways (12)              681
 14           LAN Airlines (17)               669
 15            Air France (14)                662
 16           Thai Airways (19)               652
 17          Qatar Airways (20)               645
 18      China Eastern Airlines (21)          578
 19               KLM (18)                    480
 20        All Nippon Airways (24)            476
 21          Japan Airlines (16)              473
 22        Malaysia Airlines (22)             469
 23            Air China (25)                 445
 24         Delta Air Lines (37)              394
 25          Etihad Airways (23)              380
 26      Nippon Cargo Airlines (27)           373
 27        American Airlines (28)             323
 28      Saudi Arabian Airlines (30)          288
 29         Turkish Airlines (33)             267
 30           TNT Airways (32)                256
 31          Qantas Airways (29)              249
 32       Volga-Dnepr Airlines (38)           240
 33     China Southern Airlines (46)          222
 34              Swiss (34)                   220
 35         Virgin Atlantic (36)              212
 36            Air Canada (40)                207
 37              Iberia (39)                  201
 38            Dragonair (35)                 180
 39       Continental Airlines (43)           155
 40           Jet Airways (44)                134
 41        DHL International (42)             133
 42             Egyptair (57)                 127
 43      South African Airways (49)           126
 44    Aeroflot Russian Airlines (59)         121
 45             Finnair (50)                  114
 46             Gulf Air (41)                 114
 47         Air New Zealand (45)              110
 48        Ethiopian Airlines (55)            105
 49      El Al Israel Airlines (47)           103
 50            Air India (51)                  98


Rank              Airline *                 Tonnage
                                         (in thousands)

1                 FedEx (1)                  6,949
2             UPS Airlines (2)               4,509
3              Korean Air (3)                1,805
4               Emirates (4)                 1,777
5        Cathay Pacific Airways (5)          1,579
6            United Airlines (6)             1,555
7            China Airlines (8)              1,347
8          Singapore Airlines (7)            1,149
9        China Eastern Airlines (11)         1,104
10             Air China (12)                1,069
11      China Southern Airlines (13)         1,055
12             Lufthansa (10)                1,052
13           Japan Airlines (9)               911
14         All Nippon Airways (14)            895
15              EVA Air (20)                  850
16          Asiana Airlines (15)              784
17              Cargolux (16)                 712
18            Thai Airways (22)               709
19            LAN Airlines (21)               694
20          British Airways (17)              682
21             Air France (18)                667
22           Qatar Airways (24)               645
23          Delta Air Lines (33)              525
24         Malaysia Airlines (25)             507
25                KLM (23)                    480
26         American Airlines (27)             428
27           Etihad Airways (29)              380
28           Qantas Airways (26)              375
29       Nippon Cargo Airlines (32)           373
30       Saudi Arabian Airlines (31)          351
31          Turkish Airlines (35)             303
32          Hainan Airlines (34)              280
33             Air Canada (40)                261
34            TNT Airways (36)                256
35        Volga-Dnepr Airlines (47)           240
36               Iberia (39)                  237
37         Shenzhen Airlines (37)             229
38               Swiss (38)                   223
39          Virgin Atlantic (43)              212
40          Garuda Indonesia (46)             207
41        Continental Airlines (45)           205
42            Jet Airways (44)                205
43             Air India (49)                 180
44             Dragonair (41)                 180
45          Vietnam Airlines (51)             179
46          Sichuan Airlines (48)             170
47     Aeroflot Russian Airlines (60)         163
48       South African Airways (55)           161
49          Xiamen Airlines (53)              158
50         Shanghai Airlines (42)             153

* 2009 ranking in parentheses

Source: International Air Transport Association

Systemwide statistic               Percent change over
                                       previous year

All-cargo flights             2006     2007      2008    2009

Kilometers flown               3.5      2.5      -5.3    -15.5
  (in millions)
Aircraft departures             3       1.2      -3.4    -12.2
  (in thousands)
Hours flown                    4.1      2.3      -3.2    -15.3
  (in thousands)
Freight tonnes carried         3.4      4.2      -4.9    -13.5
  (in thousands)
Freight tonne-kilometers       3.6      3.3      -6.1    -15.8
  (in millions)
Mail tonne-kilometers        -18.2      1.4      -0.8      0.5
  (in millions)
Available tonne-kilometers     3.8      3.6       -4     -16.4
  (in millions)
Weight load factor           -0.2pt   -0.2pt   -1.4pt   0.6pt

Systemwide statistics        Year 2010          Average annual

                                     %       5-year      10-year
All-cargo flights        Number    Change   2010/2006   2010/2001

Kilometers flown          1,696     9.9       -1.4         21
  (in millions)
Aircraft departures         781     6.5       -1.2         0.8
  (in thousands)
Hours flown               2,450     9.6       -0.9         2.1
  (in thousands)
Freight tonnes carried   22,647      15        0.4         3.3
  (in thousands)
Freight tonne-           93,001    20.7        0.5         3.4
  (in millions)
Mail tonne-kilometers       605      28        1.1         1.3
  (in millions)
Available tonne-        133,595    14.1       -0.3         3.4
  (in millions)
Weight load factor        70.1%    3.9pt      0.2pt       0.1pt

Source: IATA
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Title Annotation:feature focus: Top Carriers
Comment:Top 50 cargo carries: cargo's cream of the crop.(feature focus: Top Carriers)
Publication:Air Cargo World, International ed.
Geographic Code:90ASI
Date:Oct 1, 2011
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