The air cargo industry in particular, has been hit hard this past year. Figures published by The International Air Cargo Association (TIACA) in September indicated that airlines losses could total US$11 billion for 2009. Consequently, cost pressure on air carriers has caused them to outsource their network-wide cargo sales and services offices to General Sales Agents (GSAs) and General Sales and Service Agents (GSSAs).

“We started at a difficult time, but I believe it’s also a good time for this business, especially given how airlines recognise a need for expanded services while reducing their own staffing,” saysTubbesing.

Building an Asian portfolio
Currently, Tubbesing’s company is representing Hainan Airlines, a carrier that flies four times a week between Seattle and Beijing. In January, Airlines National Services will also commence a new relationship with another Asian carrier, but cannot disclose which one just yet. “We are very eager to grow and develop relationships with Asian carriers,” Tubbesing stresses, however.

Although Airlines National Services, headquartered in Dallas, Texas, has been in existence for only one year, in that short period it has grown to seven offices (Dallas, New York, Chicago, San Francisco, Seattle, Los Angeles, and Atlanta), and will be adding three more in Canada (Vancouver, Toronto and Montreal) in January 2010.

“Our business model is to offer nationwide coverage throughout the United States and Canada to an Asian air carrier,” Tubbesing states. “The benefit of that is to obviously work with a reduced number of partners, and offer a commitment on a larger scale.”

Airlines National Services aims to focus its business customer service to both freight forwarder customers and airlines.

“We are taking great pains to offer quality service,” he says. “Operational quality and performance is key. We hope that through our efforts and the data we offer, we can provide value-added service.”

A bright future
For Tubbesing, the future looks bright. Business between North America and Asia, especially China, continues to grow, especially exports from the US due to the weak US dollar.

“I think the carriers that are operating in that market right now are happy with business,” Tubbesing says. “There’s still an imbalance — price-wise, but that has always been the case. Export volumes are stable now and that is a good sign.”

What could further help matters is if the Chinese government eases some of the taxation and tariffs on certain US exports to China.

“This would provide another substantive sign for trade relations,” he comments.

Asian carriers are already taking note. Many are indicating a renewed interest in expanding or bringing service or certain routes back to the US that they had abandoned earlier this year. Among them are China Eastern, which has applied for additional flights to the US and China Southern, which is discussing comingback to the US with freighters.

Specialised service
Tubbesing is eager to develop relationships with such Asian carriers. To grow that relationship, his company offers business and technology solutions in which Chinese carriers are not well versed.

“For example their websites are only in Chinese, which makes it difficult to implement track and trace functions in North America,” he says.

Air carriers in China also have not built up business components, such as paperless filing of air waybills, to the same level as their European or American counterparts.

“These issues can become a differentiator when competing for business with other carriers,” he says. “We are working hard to minimise that gap.”

To do this, the company utilises its own website, which also bridges a cultural gap since Asian carriers conduct business quite differently than those in the United States.

“For one, air carriers in China are traditionally used to being the king, since they are the one with the capacity all the forwarders there want,” he says. “Here in the US, it is not the same. Forwarders are in the position of strength and consequently have higher expectations of carriers in regards to communications because they are the customer.”

Furthermore, to Chinese carrier executives in China, North American forwarder expectations seem over the top.

“Understanding both sides and developing trust will take time,” Tubbesing remarks. “But it is important because Asian carriers will become a permanent fixture in the US and will need more market share. Chinese airlines look for long partnerships, not a fast and quick fix.”

For that reason, Tubbesing is glad his company started business during the slow economy, since he now has the time to start with the right customer focus.

“I’m not caught up in crazy things like money with little return,” he says. “If you grow your business during these times and have success, it will be easier when the market becomes more positive. Customers appreciate the fact we work hard on their behalf in difficulttimes.”