THE Ministry of Transport has approved a plan to start major repair work at the southern locks of the Three Gorges Dam and No 1 lock at the old Gezhouba Dam, reports Xinhua.

The repair work is scheduled to be completed by 26 March at the Three Gorges and April 30 at Gezhouba. It is estimated that 2,400 vessels will be held up and 5.1 million tonnes of cargo delayed during the period.

While the work is being done, the northern locks of the Three Gorges Dam, which usually allow vessels to pass upstream, will swap directions at intervals to allow two-way traffic. At Gezhouba, the No 2 and No 3 locks will continue operation normally. Priority will be given to vessels carrying livestock, emergency relief materials, containers on shuttle services, ro-ro cargo and long-haul passengers.

This is the first routine repair activity since the old dam was put into operation more than 30 years ago. The repair work will be carried out once every six years from now on according to the plan.

Source Shipping Gazette - Daily Shipping News

MAERSK'S Asia-Europe shipping lane AE9 has started calling at south eastern China's Fuzhou International Container Terminal (FICT), Xinhua reports.

The AE9 deploys nine ships ranging from 6,250 to 7,250 TEU, offering a weekly capacity of 7,050 TEU, representing about 10 per cent of the total capacity of Maersk's Asia-Europe capacity. The lane calls at FICT every Thursday with a rotation of Ningbo, Shanghai, Fuzhou, Yantian, Tanjung Pelepas, Suez Canal, Rotterdam, Bremen, Felixstowe, Zeebrugge, Algeciras, Tangier, Suez Canal and back to Xiamen.

Maersk started calling at FICT in 2008. Last year, it contributed 132,000 TEU to Fuzhou's throughput, up 14 per cent year on year, growing faster than Fuzhou's foreign trade throughput growth of 10.4 per cent. The carrier has become the largest contributor to Fuzhou's box throughput.

Fuzhou port's Jiangyin port area, where FICT is located, handled 754,000 TEU last year, 16.6 per cent more than in 2010.

Source Shipping Gazette - Daily Shipping News

A 300-METRE section of the Hanyi High-Speed Railway between Wuhan and Yichang near the Three Gorges Dam, collapsed in heavy rain, reports the Wall Street Journal, adding that this comes after the July train crash near Wenzhou that killed 40 people.

A collapsed section is expected to open in May. Hundreds of construction workers are working to repair the affected section, according state media. The extent of the collapse wasn't immediately clear and there were no reports on any injuries.

Hou Xinyue, a local railway official in Qianjiang, argued that the incident affected 4.3 miles of the rail line, a larger stretch of track than reported by state media. The local rail bureau is said to be still investigating the accident.

Source Shipping Gazette - Daily Shipping News

INTRA-ASIA container line MCC Transport, a Maersk unit, has introduced a new mobile website and a smart phone application to enable customers to better track shipments and sailing schedules.

MCC Transport, which operates more than 60 vessels in the 600 to 3,000 TEU range, said the mobile service is available for all major mobile phone systems, while the application can be used on iPhone, iPad and iPod devices and is available for download at Apple's iTunes store.

"We want to offer customers the convenience of accessing up-to-date shipping information like schedules and search and track their shipments anytime, anywhere," said Rupesh Jain, chief commercial officer. "They will find it easier and more efficient to use our e-solutions and get the information they need on the go."

"We offer the convenience of accessing up-to-date shipping information like schedules and search and track their shipments any time, any where. They will find it easier and more efficient to use our e-solutions and get the information they need on the go," said MCC chief commercial officer Rupesh Jain.

"Our aim is to provide positive customer experience and greater ease of business. We are one of the few shipping lines to provide such an innovative technology and believe such e-solutions will better meet the needs of our IT-savvy customers, who frequently need to access such shipping information in a speedy manner, while on the move," Mr Jain added.

MCC Transport is an intra-Asia carrier handling all Maersk container cargo in the region. With market experience of more than 20 years, MCC Transport provides customers with wide-range direct port coverage and a large corridor portfolio in Asia.

Source Shipping Gazette - Daily Shipping News

DP World is continuing to make strategic investments in its terminalin Jebel Ali that handles cargo destined for the Middle East, India and Africa, said one of its top executives.

Speaking at DP World's sponsored 8th Annual Marine Money Gulf Ship Finance Conference, in Dubai, the company senior vice president and managing director Mohammed Al Muallem, said: "We saw a 12 per cent increase in volume in UAE region last year with a record throughput of 13 million TEU. Because of this growth and because shipping lines are purchasing ever larger vessels, we are adding one million TEU to Terminal 2 and developing a new terminal with capacity of four million TEU. Together they take Jebel Ali's total capacity to 19 million TEU by 2014."

The event attended by scores of top industry leaders, including ship owners and maritime analysts, focused on some of the key areas shaping the container shipping industry in the Gulf, including the offshore support sector, available financial structures, leasing and marine piracy, according to Dubai's Khaleej Times.

Said Mr Al Muallem: "Today we must again quickly take stock of things and adopt business growth strategies in line with the emerging situation. The UAE and Dubai are a springboard for businesses and investors from around the world."

Source Shipping Gazette - Daily Shipping News

LOGWIN, Luxembourg's global logistics provider, has posted a 10 per cent drop in operating profit to EUR21.6 million (US$28.4 million) in 2011 drawn on revenues of EUR1.33 billion, which also declined 10 per cent

Its air and ocean sector declined by seven per cent year on year to EUR618.4 million in sales due to sea freight rates creating a challenging second half, despite volumes rising year on year for both sea and air freight.

General cargo volumes grew in both its retail network and the automotive sector with sales of EUR717.0 million.

Although profit has not met expectations Logwin chairman and CEO Berndt-Michael Winter is confident of "moderate growth" in business volumes for the growth markets it has targeted in its air and ocean sector.

Source Shipping Gazette - Daily Shipping News

HONG KONG's Orient Overseas Container Line has opened its OOCL Maritime Academy and the International Seaman Training Centre in Zhoushan in Zhejiang province to promote maritime education and to support the role that Chinese seafarers play in the world's maritime transportation and logistics industry.

Jointly established by OOCL and the Zhejiang International Maritime College, both the Academy and Training Centre, located at the college in Zhoushan, aims to greatly contribute to the development of maritime technology, safety, security, and environmental protection as well as open up professional career opportunities for Chinese seafarers to serve in international merchant fleets, the company said.

The training facility uses equipment and installations that simulate situations on board a real container vessel. This helps students to better understand and acquire the necessary knowledge and skills to prepare them for the challenging work on board a vessel.

OOCL chief operations officer Andy Tung and Zhejiang International Maritime College president Wang Jie welcomed guests at the opening ceremony, including Han Jie, deputy commissioner of the Department of Commerce of Zhejiang province and Zhu Shi Qiang, vice mayor of Zhoushan.

Said Mr Tung: "The relations of OOCL with Zhoushan and the Zhejiang International Maritime College can be traced back to 1998, when OOCL first helped set up what was then called the Zhoushan Maritime Simulator Centre at the campus, providing professional training for OOCL seafarers as well as for shipping companies from Beijing, Norway and Taiwan.

"We hope that with the establishment of the Academy and the Training Centre, more Chinese maritime professionals will be better equipped to contribute to the industry; as well as to help in the rapid development of the Zhoushan Archipelago New Area, as designated by the China State Council last June, to develop into a leading oceanic economic development area," he added.

Source Shipping Gazette - Daily Shipping News

PRIVATE smaller ports in India have been notching up double-digit volume growth whereas the 12 major ports are nowhere near the picture as they struggled to churn out a dismal 0.38 per cent increase, according to the Daily News & Analysis of India.

The divergence in growth rates between private and major public ports continues to be accentuated with every passing quarter and the assessment of the Indian Ports Association (IPA) with public port even suffering negative growth.

According to data available for the past two financial years, four minor ports - Essar Ports, Mundra, Gujarat Pipavav and Karaikal - are way ahead in performance compared with their public sector peers.

The volume at Adani-controlled Mundra Port in Gujarat grew 33 per cent to 16.6 million tonnes in the December quarter from 12.5 million tonnes in April-June 2010.

APM Terminal-controlled Gujarat Pipavav is cruising, too. In the last two years, container volumes have climbed a massive 90 per cent. The total container volumes handled in 2011 was 610,243 TEU, up from 321,400 TEU in 2009.

Volumes for the Tamil-Nadu based Karaikal port have almost doubled. The specifics are not available in the public domain, but insiders revealed that the increase has been a staggering 197 per cent.

The corresponding figures for Essar port are not available, but by all accounts, the private venture looks poised for a solid growth this fiscal. The total volume handled was 39.55 million tonnes last financial year and for April-December 2011, the number came in at around 30.87 million tonnes, the report said.

The major ports pale in comparison. Last fiscal, the growth rate in total volumes at all 12 major ports stood at a measly 1.57 per cent year on year. IPA data showed that the volume growth for April-February 2012 has been negative at -0.74 per cent.

To make things worse, individual performance of two main ports in the country is far from satisfactory. Mumbai's Jawaharlal Nehru Port Trust (JNPT), the busiest container port in the country, grew 5.82 per cent year on year in volumes last fiscal. For April-February 2012, the rate is much lower at three per cent. Similarly, Kandla port, the country's largest port in terms of volumes handled, has slowed. While for the last financial year, the port reported a three per cent year-on-year growth in volumes.

The bottom line is the momentum seems to lie with the private ports as these have been aggressively ramping up their capacity and improving cargo clearance measures. In contrast, major ports have given a poor account of themselves by failing to step up. Despite the Shipping Ministry drawing up ambitious measures under the 11th Five Year Plan, nothing much has seen the light of day. The ministry had set a target of awarding 23 projects this fiscal, in reality it has managed to award only two, which are the dry bulk terminal project at Kandla and JNPT's fourth container terminal.

Source Shipping Gazette - Daily Shipping News

INDIA's low-cost carrier Spicejet is to launch cargo services from Surat in the second week of April, with further approval pending on freight operations to Delhi and Mumbai.

The introduction of cargo operations from Surat, the diamond city, to Dubai has keen support from the South Gujarat Chamber of Commerce and Industries (SGCCI) and diamond representatives which met with the airline team on a visit to the city.

"We are planning special passenger-cum-cargo services for textile and diamond industry of the city. Once we finish discussing the modalities with different agencies, they will be started," said Spicejet cargo chief V Raghuraman, reported India's Economic Times.

Said SGCCI president Rohit Mehtav: "Federation of Surat Textiles Traders Association (FOSTTA) officials made their presentation for the cargo services to the cities like Hyderabad, Chennai and Kolkata. Representatives of diamond industry demanded cargo services to Dubai and Antwerp."

FOSTTA, he said, asked for connectivity to 11 different cities of the country from Surat to Kolkata, Patna, Ranchi, Cuttack, Guwahati, Varanasi, Lucknow, Amritsar, Ludhiana, Jalandhar, Jammu, Raipur, Bhopal, Indore, Goa, Kochi, Chennai, Bangalore and Trivandrum.

Source Shipping Gazette - Daily Shipping News

IN the 18 years since USAF Master Sgt Mitch Pykosz first became involved in air transportation, he has moved on from building cargo pallets for aircraft to become a team leader on Air Mobility Command's (AMC) cargo precision loading programme, working with a "great team" of mobility airmen across the globe to make cargo loading more effective and efficient.

Originally started in July 2010 as a next generation cargo capability initiative, the project morphed into "cargo precision loading," as it grew through the participation of a myriad of aerial ports, people and efforts throughout Air Mobility Command, said Mr Pykosz, precision loading programme manager for AMC's directorate of logistics, air transportation cargo policy team, a report by Avionics Intelligence said.

According to an AMC paper on the initiative, the precision loading programme "standardises air cargo build up from depot suppliers and AMC aerial ports to maximise volume and weight utilisation."

The programme increases operational effectiveness and reduces fuel cost while meeting the component commander end customers' "Time Definite Delivery," or TDD, requirements. The programme's principles lead to more efficiently-built cargo pallets, resulting in less pallets by-count, and more efficiently utilised aircraft, resulting in less aircraft sortie requirements.

"The bottom line," Mr Pykosz said, "is it saves AMC and the Air Force money."

The first four aerial port units to test out the new precision loading initiative were at Dover AFB, Delaware, Joint Base McGuire-Dix-Lakehurst, New Jersey, Travis AFB, California, and the AMC aerial port squadron in Norfolk, Virginia. In October 2011, AMC implemented a new precision loading policy at all AMC aerial ports throughout the world.

"At the same time as pallet building principles were being re-engineered and refocused, AMC personnel were partnering with US Transportation Command and Defense Logistics Agency personnel to seek utilisation improvements elsewhere."

On the implementation of the new policy, AMC instructed people at the cargo-processing and load planning levels to "strive for specific pallet and aircraft utilisation goals, in accordance with mission requirements."

Mr Pykosz has been present for the growth of the initiative since nearly the beginning. "The (precision loading) programme started several months before I started working with the team members," he said. "When I started, I was charged with giving the programme an expansion plan. As a team we've built that plan and expanded it to the rest of Air Mobility Command's aerial ports and en route air mobility squadrons. It's a great programme that is working very well with improving efficiency."

One area of efficiency that comes into play is utilising as much pallet space as possible on both contract and military airlift missions, which in turn requires less missions to complete, Mr Pykosz said. The effort includes building pallets to their maximum weight or volume goals, based on specific aircraft requirements.

Through February, precision loading enabled a nine per cent mission utilisation increase which led to an avoidance of 195 air missions.

Source Shipping Gazette - Daily Shipping News

5th generation Kongsberg Seatex motion sensor range expands

Kongsberg Seatex, Kongsberg Maritime’s position reference specialist division is launching two brand new Motion Reference Units (MRU) at Oceanology International 2012. Both products are part of the company’s market leading fifth generation range of MRUs and have been designed specifically for survey and crane operations, and outside installations such as helideck monitoring.

The new MRU 3 is designed for roll, pitch and heave compensation applications including real-time heave compensation of echo sounders during survey operations and active heave compensation of offshore cranes. It provides heave measurements to meet IHO standards ensuring that echo sounder data is highly accurate pre and post processing, whilst offshore crane safety and efficiency can be also be improved. The MRU 3 achieves high reliability by using solid state sensors with no rotational or mechanical parts.

A second new model, the MRU E, is specially designed for use in marine applications that require an extended temperature range. It can operate at ambient temperatures from -25 to +70°C and can be installed on open decks, inside cabinets or on bulkheads. Typical applications include direct mounting under the helideck centre to measure 3-axes linear accelerations together with roll, pitch and heave. Because of the extended temperature range of the MRU E, no additional enclosure or cabinet is required and the system meets Helideck Certification Agency (HCA) requirements to measure helideck acceleration and calculate Motion Severity Index (MSI).

Both new MRUs accept input of external speed and heading information on separate serial lines or Ethernet for improved accuracy in heave, roll and pitch during turns and accelerations. For time synchronization the MRU accepts 1-second time pulse (1PPS) input on a TTL line (XIN) or as RS-232 or 422 signal. The MRU 3 and MRU E also make data available through an Ethernet interface enabling easy distribution to multiple users on board the vessel. Output protocols for commonly used survey equipment are available on two individually configurable serial lines and Ethernet/UDP, with communication protocols selectable in the Windows based MRU configuration software.

To find out more about these new MRU variants, visit Kongsberg Maritime on stand E600 at Oceanology International 2012.

Source Kongsberg Maritime
The Chopin Airport City project launched by Warsaw Chopin Airport was presented to potential investors at the MIPIM International Real Estate Trade Show in Cannes. The concept of the business park with entertainment and leisure facilities to be developed on 22,5 ha area has already won recognition of the real estate en-vironment.

As part of the project, the area located near the Chopin Airport Terminal will be transformed into a modern business park open to the public. An innovative combination of the concept of commercial development of the area and a creative approach to public space functions will re-sult in a unique urban form, which should become one of the new architectural icons of the city. The project initiated by Warsaw Chopin Airport's operator, 'Polish Airports' State Enterprise was presented last week at the International Real Estate Trade Show in Cannes, as part of Warsaw's stand. The MIPIM trade show was its international debut and also the first attempt to obtain investors.

"MIPIM trade show was very fruitful time for our project. We had dozens of meetings with in-vestors and developers who showed a lot of interest in our investment”, says Michał Marzec, ‘Polish Airports’ General Director. “We managed to establish crucial business contacts. It all looks very promising.", concludes Michał Marzec.

The project is aimed at attracting business customers. Chopin Airport City will be set in War-saw, the capital of Poland, populated by nearly two million people. According to CB Richard Ellis' report (2012) Warsaw is the second most attractive business location among the top tar-gets for investors in Europe in 2012. Warsaw attracted more investors than Paris (3rd place), Berlin and Munich.

The Airport City's business concept requires developing appropriate office and conference facili-ties, corresponding to the highest international standards and meeting the expectations of the most demanding customers. Approximately 165 thousand sq. m. of usable space in sixteen 'class A' office buildings will form a business park, providing modern offices, conference rooms and retail services.

Work on some of the construction projects to develop what is to become part of Chopin Airport City infrastructure is already drawing to a close. Set to open in 2013 are two new hotels, the five-star Renaissance by Marriott and the two-star Hampton by Hilton, neighbouring the airport city. Situated right next to the Chopin Airport Terminal is the four-star Courtyard by Marriott.

Chopin Airport City will be easily accessible from Warsaw and beyond. A railway line with an underground station will soon be opened within the airport city's boundaries. The development of an expressway system around the airport, running south- and westwards, which is nearing completion, will also allow for fast and convenient access to the business park.   

It should be mentioned that the venue will also serve a recreational function, with plenty of greenery. The distinguishing feature of the area will be its spacious park, with a centrally-located plaza, featuring restaurants, fitness centres and galleries. The park will be open to eve-ryone – people working at the nearby office buildings, airport passengers, tourists and resi-dents.

Source Chopin Airport Press Office

Kuala Lumpur - The International Air Transport Association (IATA) announced that the  Secure Freight program has gained further recognition from governments around the world.

*         IATA and the Malaysia Civil Aviation Authority signed a Memorandum of Understanding (MOU) on expanding the Secure Freight pilot scheme, which began in 2010.

*         The UK Department of Transport (DfT) has agreed to endorse the Secure Freight principles, which paves the way for further recognition of Secure Freight principles and IATA's efforts to build supply chain security capacity across the world. The first authority to officially endorse Secure Freight principles was the Australian Office of Transport Security (AU OTS), last summer.

*         Five governments have agreed to be co-signing authorities on IATA's Information Paper on Secure Freight, which will be presented at ICAO's AVSEC Panel, March 26-30. The countries co-signing the document include the CAA's from Malaysia, Kenya, Mexico, UAE and Chile. This represents a major step forward in building shared global standards for cargo supply chain security programs.

The Secure Freight program works across the whole air cargo supply chain, helping to secure shipments upstream by ensuring that cargo has come from either a known consignor or regulated agent. Secure Freight evaluates the strength of a nation's aviation security infrastructure and works with the civil aviation authorities to ensure that cargo is kept sterile until it is loaded. Not only does this ensure greater security, it also helps prevent bottlenecks at airports.

"IATA is working with countries to build the capability for Secure Freight implementation, including the launching of pilot programs. The development of a consistent set of standards should facilitate the mutual recognition of secure freight programs. The UK DFT is an important indication of success so far and should encourage more governments to implement this global standard supply chain solution," said Des Vertannes, IATA's Global Head of Cargo.

The MOU was signed on the opening morning of the World Cargo Symposium in Kuala Lumpur, Malaysia, 13-15 March. Nearly 1000 cargo professionals have gathered to agree new solutions to deliver enhanced safety, security, quality and efficiency to the air freight sector.

"Since it launched the first IATA Secure Freight pilot initiative, Malaysia has been at the forefront of aviation cargo security, and this MOU commits us to work together for full implementation. Secure Freight offers the prospect of enhanced security and greater efficiency in the air cargo system, which should be of great benefit to the Malaysian economy," said Tony Tyler, IATA's Director General and CEO.

Commenting on the MOU, Mr YB Dato Seri' Kong Cho Ha, Minister of Transport, said "I am pleased that Malaysia is the pilot country for the Secure Freight program. The result of this close collaboration will benefit many industry players as it will reduce the complexities and costs of air cargo security, as well as ensuring that the supply chain stakeholders are working towards the same direction."

Source IATA

Kuala Lumpur -The International Air Transport Association (IATA) advocated strong partnerships across the air cargo value chain to address an industry agenda to enhance safety, security, sustainability and competitiveness.

“Air cargo is critical to the global economy. By value, over 35% of goods traded internationally are handled by air. But this accounts for just 0.5% of global volumes traded. Air cargo provides the connectivity that is at the core of modern businesses serving global markets. The growth potential is enormous. The challenge is to propel that growth sustainably, with quality products, efficiently delivered by a well-coordinated value chain,” said Tony Tyler, IATA’s Director General and CEO in a keynote address to the World Cargo Symposium which is meeting in Kuala Lumpur, Malaysia.

Safety: The 2011 hull loss rate for western-built jet aircraft stood at the historic low of 0.37 hull losses per million flights (one hull loss for every 2.7 million flights). However,managing shipments of dangerous goods is an increasingly complex challenge for air cargo as the number of shippers proliferates, particularly with the growth of e-commerce opportunities for individual entrepreneurs, who lack awareness of dangerous goods regulations.  “The concern over shipping lithium batteries is a good example of where the supply chain needs to cooperate to raise awareness levels,” said Tyler.

Security:Tyler urged the industry to work together and in cooperation with governments on industry solutions for cargo security, or risk the imposition of regulatory solutions that may not fully understand the operational realities of global air cargo. “The challenge is two-fold. We must continuously improve security to meet evolving threats. And we need to achieve this while maintaining the speed necessary to support global commerce,” said Tyler. He highlighted three areas for a particular focus:

Data to Support Risk Management:Tyler encouraged regulators to harmonize risk-assessment measures in compliance through the World Customs Organization SAFE standards. At the same time he urged the air cargo value chain to redouble its efforts to improve the quality of data provided by making the Message Improvement Program a priority for 2012. “Ensuring quality data will gain the confidence of regulators and customs authorities that is necessary to motivate them towards efficient paper-free processes,” said Tyler.
Securing the Supply Chain:   The IATA Secure Freight pilot program was launched in Malaysia in 2010 with the goal of securing the supply chain by ensuring that air cargo has come from either a known consignor or regulated agent and has been kept sterile until it is loaded onto the aircraft. The success of the Malaysian pilot project has encouraged Kenya, Mexico, Chile, South Africa, Egypt and the United Arab Emirates to start their own programs.
Technology:Tyler noted progress with regulators on addressing the constraints on current technology in screening air cargo. “It is clear that a robust risk-assessment needs both physical and data screening programs that are harmonized. The worst thing for both industry and states would be to have these programs competing with each other across airline networks,” said Tyler.

Competitiveness:  “Alongside a license to grow based on safety, security and environmental responsibility, to be successful the air cargo value chain must meet customer expectations with efficient and quality products and processes,” said Tyler, highlighting e-freight and the industry’s need to adopt Cargo 2000 as a global standard.

E-freight: E-freight penetration stood at 11% at the end of 2011, ahead of the 10% target set by the IATA Board of Governors. “I see three components to achieving 100% by 2015. First, we need to understand e-freight is a supply chain initiative driven forward by the Global Air Cargo Advisory Group (GACAG). Second airlines must drive forward the implementation of the e-air waybill (e-AWB). Cathay Pacific and Emirates have led the way with mandating 100% e-AWB in their home markets. And finally we must ensure that the rapidly developing BRICS countries are on board,” said Tyler. Current e-AWB penetration is 4.6%.  IATA is targeting 15% e-AWB penetration by the end of 2012 and 100% by 2014.
Quality: In the last year Cargo 2000 made its Master Operating Plan an open source platform. “This effectively makes Cargo 2000 the industry benchmark for performance and quality. They will also be introducing a membership grading system to further identify the highest-quality participants. These are positive steps that will help us to provide quality products to our customers,” said Tyler. Tyler reiterated that managing quality requires a harmonized approach across the value chain, noting the industry agreement to mandate the “Time and Temperature Sensitive” label as an important example of improvements that can be achieved when the industry works with a common purpose.

Industry Cooperation: Air transport is a team effort. And that is particularly true of air cargo. I am also making it a priority for IATA to work even more closely with our industry partners.  For example we are working to modernize the cargo agency program in close collaboration with the International Federation of Freight Forwarders Associations (FIATA).  I am also fully supportive of the GACAG. This group is unique in the air cargo industry and we must all support the efforts of this coalition. All its members won’t always have the same view of the world. But our fates are linked as we are in the same business. By focusing on our common interests, I am confident that much can be achieved,” said Tyler.


In its latest forecast (issued December 2011), IATA expects air cargo to generate about 11% of total revenues or $66 billion. This is only slightly behind the average 14% contribution of business class to industry revenues. Growth in both volumes and yields is expected to be flat in 2012 as a result of economic uncertainty primarily centered on Europe. IATA will issue a revised forecast on 20 March.

Source IATA

LSG Sky Chefs, the world’s largest provider of in-flight services, and Finnair have signed a Memorandum of Understanding  on LSG Sky Chefs acquiring Finnair’s catering operations. The acquisition would comprise the entire share capital of Finnair Catering Ltd. and Finncatering Ltd. Finnair would continue to buy its flight catering services from Finnair Catering Ltd., which transfers under LSG Sky Chefs ownership. The acquisition is subject to the approval of Lufthansa Board and the competition authority of Finland and it is expected to be closed by the end of first half of 2012.

"LSG Sky Chefs is one of the leading players in the in-flight service industry. Its international product development, global operations and profound know-how of in-flight services are an excellent basis for producing high-quality in-flight service for Finnair customers. We have positive experiences with LSG Sky Chefs from other airports outside Finland and this is a natural continuation of our partnership", says Anssi Komulainen, Senior Vice President of Customer Service at Finnair.

“Together with other measures taken to improve efficiency in catering operations of our airline business, we expect this transaction to result in substantial permanent annual cost savings contributing to our overall savings targets.”

"LSG Sky Chefs is extremely pleased to be able to widen its operations to the strategically important Finnish market. Finnair’s catering operations are well run, the personnel is very professional and the production facilities are state-of-the art. Finnair is an important client for us and we are convinced that we can further develop the operations, thus producing additional value for Finnair and its passengers", states Jochen Müller, Executive Board Member Operations of LSG Sky Chefs.

In 2010, the catering business included in the Memorandum of Understanding had net sales of 80 million euro. Subject to the final agreement, approximately 650 employees of Finnair Catering Ltd and Finncatering Ltd will be employed by LSG Sky Chefs. The transaction does not include Finnair Travel Retail, which as of January 1, 2012 has been a part of Finnair’s other operations.

Developing its partnership network is a part of Finnair’s strategy and the planned structural changes of the company, which aim at cost savings and facilitating growth through quality improvements. Finnair had announced earlier that it was looking for a cooperation partner for its catering services.

LSG Sky Chefs is the world’s largest provider of in-flight services. These include catering, in-flight equipment and logistics, in-flight retail as well as the management of onboard service and related airport services. LSG Sky Chefs partners with more than 300 airlines worldwide and operates some 200 customer service centers in 50 countries, producing around 460 million airline meals a year. In 2010, the companies belonging to LSG Sky Chefs Group achieved consolidated revenues of € 2.2 billion. For further information also visit

Finnair announced on August 5, 2011 that it targeted decreases in its annual costs of 140 million euros by 2014. Finnair has already announced that it:

  • has chosen Swissport as its partner for  baggage and apron services
  • is optimizing the size of its fleet in European air traffic, has discontinued the leases of four Airbus 320 series aircraft, and subleased four Embraer 170 aircraft
  • is exploring  different alternatives to improve cost-efficiency of its engine and component maintenance services
  • is streamlining its support functions as well as  marketing and distribution activities
  • seeks a partner to accelerate its Nordic Champion strategy and aims to significantly lower costs in European traffic
  • has initiated  numerous other savings measures throughout the company.

Source Nasdaqomx

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