Asia remains a difficult market for aglobal GSA like European Cargo Services(ECS), but that should change asair freight rates fall, predicts its presidentand CEO, Guy Tordjman.
“Competition is increasing in Asia,and rates will not stay so high, so airlineswill have to compensate by reducingcosts,” he says. “They will then seethe need to turn to GSAs much more than they have in the past.”
To be ready for that day, ECS continuesto try and develop its networkin the region, using Singapore as thebase for ECS Asia. From here it isexpanding to the rest of China andHong Kong, mainly using the GlobeAir brand that it has rolled out overmuch of Europe.
Tordjman says the company alsohas “two or three projects pending” inMalaysia, and Indonesia, saying that itwould like to make acquisitions in thesecountries and elsewhere in Asia.
“But it is not so easy as in Europe,because, for example in Malaysia, cargoGSA businesses are not independent.They are involved in passenger trafficor freight forwarding, and sometimesare more brokerage companies or consolidatorsthan GSAs. We want to haveindependent cargo GSAs on the same model as we have in Europe.”
Dubai has also proved somewhatharder going than expected for thegroup, though it did open an office atthe new Jebel Ali airport in January.
Tordjman admits that it was drivento this by a lack of suitable companiesto buy, and concedes that many airlinesalso prefer to have their own staff inDubai.
Having said that, he sees the potentialto feed sea-air traffic from Dubaito ECS’ global airline customers.These include Ukraine International,which ECS represents everywhere butin its home market, and SN BrusselsAirlines, for whom ECS provides acomplete cargo capacity managementservice.
“A lot of sea-air traffic throughDubai is destined for Africa, so itmakes sense for SN Brussels to have an offline representative in Dubai,” Tordjman points out. “We can feed cargo into Africa via Brussels, but we are also exploring direct connections from Dubai to Africa.”
Dubai is also a convenient base tocapture Indian Subcontinent or EastAsian traffic destined for Africa, aswell as cargo on flights that terminatein Dubai. “Flights from the Far East to Europe are full, but there are still flights by Asian or Indian airlines that terminate in Dubai as a final destination. Through our office there, we can take some of this cargo onwards to Europe or Africa,” Tordjman says.
One further way to develop the businessmight even be to represent Asianor Indian carriers in Dubai on theseterminating flights, he adds.
Back in Europe, ECS recently pickedup a contract to fill El Al flights toAsian and US destinations, though notto Tel Aviv.
Tordjman points out that many ofthe new Asian cargo carriers Â¨C suchas Jade Cargo International and GreatWall Airlines have also chosen the GSAroute for their new services to the continent,and predicts that this will be agood source of business growth in thefuture.
– Peter Conway