August 26, 2020
At Crane Worldwide Logistics, we continue to provide services to our clients and communities in need through the COVID-19 pandemic. As companies start to reopen and businesses return to their normal operations, we want you to know we support the transition. The supply chain is considered an essential service and critical to supporting the infrastructure for our communities. Guidelines are in place, and we are following all recommendations set forth by government agencies and health organizations at all of our facilities.
We have warehouse space available, ground transportation options globally and are continuing to book air charters and fill space on ocean carriers.
Find below updates regarding COVID-19 impacts for August 2020. To see our previous updates, please visit our Coronavirus COVID-19 Resource Center on our website.
Week 35 (August 24 - 30)
IATA released an information page listing the status of airlines globally, which is free for all to access. Visit the page here
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China and U.S. agree to double flights’ frequencies Airlines will be allowed to double the amount of flights between China and the United States following the easing of travel restrictions, the U.S. Department of Transportation confirmed. On September 4, 2020, United Airlines will add two more weekly flights from San Francisco to Shanghai, while Delta Airlines will add two more from Seattle and Detroit to Shanghai starting on August 24. Likewise, China Southern Airlines plans to increase weekly flights from Guangdong to Los Angeles, and Xiamen Air – from Xiamen to Los Angeles. It is the second relaxation of U.S.-China flight bans since the inception of COVID-19 pandemic and subsequent lockdowns. China allowed four weekly flights from the U.S. on June 4, and the U.S subsequently did the same. The tensions between the world’s two largest economies spiked in the first days of June, as the U.S. banned Chinese carriers from flying into the country following a set of Chinese restrictions on international travel.
Air Bridge Cargo - Asia Pacific scheduled freighter services are on the road to recovery, according to Air Bridge Cargo (ABC), with the airline still anticipating a peak season. Eric Lamare, ABC’s director of scheduled cargo operations for Asia Pacific, said while any forecast was “sensitive” at this stage, an uptick in volumes in June showed promising signs. “Asia Pacific was the first region to re-start scheduled services and, most likely, will be the first for a full recovery by 2021,” he told The Loadstar. “This will be facilitated by growing exports from North-east Asia and, in particular, by China’s GDP growth, which saw a 3.2% increase in the second quarter, following the withdrawal of coronavirus lockdowns and government stimulus to revive its economy. ”ABC has so far resumed around 50% of its scheduled cargo operations, with the rest of its services operated on charter flights. In Vietnam, where ABC saw strong growth in 2019, the airline’s volumes almost halved during the first five months of the year, due to lockdowns. We had to refocus on charter freighter services, the same as for other markets,” Mr. Lamare said. “For the moment, we only operate charter flights from Vietnam as we receive regular demands to carry PPE, mainly to the Americas. “With US and European passenger fleets still largely grounded, he indicated there would still be enough demand for an end-of-year peak season – for freighter airlines, at least Lamare added: “Peak season might be less striking than in previous years, but the lack of belly capacity will have a significant impact on logistics flows during this period and customers will want to secure capacities through cargo carriers.”
Air Canada - cargo revenues have exceeded passenger revenues for the first time, the carrier said in its second quarter results, which were released on July 31. Total operating revenue in the second quarter fell 89% to C$527 million. Of that, C$269m came from cargo — a 52% year-on-year increase from the same period last year — and $207m came from passenger transport. The airline also achieved ebitda of C$-832m in the second quarter compared with C$916m in the same period last year. Since March, Air Canada Cargo has operated more than 2,000 cargo-only flights across its network, which includes cities in Europe, Asia, South America and the US, as well as New Zealand and Australia. These flights were both scheduled and on-demand flights. The carrier also plans to operate up to 100 all-cargo flights per week in the third quarter using a combination of Boeing 787 and Boeing 777 aircraft, as well as four recently converted Boeing 777 and three converted Airbus A330 aircraft that have had their passenger seats removed. “These aircraft currently operate on international routes, carrying personal protective equipment (PPE), mail and perishables loaded in the cabin,” the company said in a statement. Air Canada Cargo’s Tim Strauss in surprise move to Amerijet. Air Canada reveals impact of Covid-19 in Q1 results Air Canada Cargo vice president, Tim Strauss, commented: “All of us are incredibly grateful to our cargo customers for allowing us to serve them in ways we never anticipated in the midst of this global disaster. “Equally, we are proud of the teamwork, creativity and focus of our employees around the world who have given their very best every day and allowed us to grow a North America best 52% year over year.”
Alitalia - As Italian government proceeds with a restructuring of its long-bankrupt national carrier Alitalia, the company’s new CEO and president are named and plans for the future operations of the airline are laid out, including a purchase of the new aircraft. By the decree by Italian Prime Minister Giuseppe Conte, signed on August 7, 2020, the new Alitalia is assigned 20 million euros as its capital, in addition to sanctioning 250 million of 3 billion euros already approved for the restructuring. One of the first priorities on which the money will be spent is acquisition of a new and efficient fleet capable of generating operational profit of at least 100 million euros, Italian newspaper Corriere della Sera reports. The new Alitalia will shed old Airbus A320s, A319s, A321s, A330s and Boeing 777s that comprise its fleet in favor of brand new A320s for short haul and Boeing 787 Dreamliners for intercontinental routes. The aircraft are expected to be purchased with 50% discount. The purchase was not confirmed by the airline, but Corriere della Sera cites four independent anonymous sources within the company, all claiming to be familiar with the plan. According to the sources, the talks with Boeing and Airbus’ sales departments are already underway, but agreements are not yet signed. The talks are spearheaded by the new management of the company, as Conte’s decree named Alitalia’s former CBO Fabio Maria Lazzerini as the new CEO and Francesco Caio, who previously oversaw Italian oilfield services company SAIPEM, as the new director of the airline. Their plan is to shrink the company’s operational costs by optimizing the fleet around fewer and newer aircraft models. A320s are selected because of their history with the airline and a potential to save on crew training costs; 787s were chosen at least partially because of the impact on the nation’s economy, as parts of the Dreamliner are manufactured in Italian plants.The decision to renationalize Alitalia came in March 2020, after the hopes to find a buyer for Italia’s long-suffering airline collapsed in the wake of COVID-19 pandemic. The company has been bankrupt since May 2017, taking billions of euros in bailouts and burning through them as the potential buyers, one after another, declined to invest into the company.
American Airlines - will fly 1,000 cargo-only flights in September after only returning to all-cargo operations in March. The airline re-launched cargo-only flights in March, with 20 strategic flights to two key destinations. “A plan that began as an experiment has now grown exponentially over the last six months,” the airline said. “Since being reintroduced, American’s cargo-only flights — which hadn’t been operated in more than 35 years — have moved more than 45m pounds of cargo around the world. But getting the first flight off the ground was nothing short of a symphony, played by team members from across the company.” After exploring options, the group began planning a cargo-only flight from Dallas-Fort Worth (DFW) to Frankfurt (FRA) scheduled to take off on Friday, March 20. “While figuring out the safety, logistics and economics of the flight was a challenge, team members were prepared for the test,” American said. “Crews were briefed, safety procedures were established, and international rules were carefully followed, “this September, more than 1,000 scheduled cargo-only flights will be accompanied by more than 1,200 passenger flights also offering cargo services. American announced to be removing services to 15 cities in the United States due to low demand. The network cuts come into effect starting from October 7, 2020.On August 20, 2020, American Airlines released a statement stating that it would suspend service to some domestic destinations as a result of “low demand and the expiration of the air service requirements associated with Coronavirus Aid, Relief and Economy Security (CARES) act. “According to the airline, these changes were temporary and only set to run through November 3, 2020. The company was also on the watch for any changes to the Payroll Support Program, keeping these and other markets under consideration. The cities with suspended services are Del Rio, Dubuque, Florence (S.C.), Greenville, Huntington, Joplin, Kalamazoo, Lake Charles, New Haven, New Windsor, Roswell, Sioux City, Springfield, Stillwater, and Williamsport. The sudden network cuts are most likely the result of the shaky financial situation in the aviation industry. American has reported $2.5 billion in losses in Q2 of FY21 while seeing a 86% drop in passengers from the prior year.
Cathay Pacific - Group reported an operating loss of HK$8.7bn ($1.13bn) for its half-year financial results, in what its chairman led the “most challenging” period for the group in its 70-year history. Cargo proved to be the sole bright spot for the troubled group, which in recent months was the subject of a government bailout, with revenue for the segment reporting the only year-on-year increase. The group’s operating loss for the six months ended June 30 was in contrast with a year ago, when it reported a half-year operating profit of HK$2.47bn. The group saw revenue for the period nearly halve, to HK$27.7 billion. Mainline carrier Cathay Pacific and regional unit Cathay Dragon saw passenger revenue collapse 72% year on year to HK$10.4bn. Cargo revenue for the two carriers saw an 8.8% year-on-year increase to HK$11.2bn, despite a decrease in cargo capacity. Total group expenses declined about 32% year on year to HK$35.6bn It reported a net loss of about HK$9.9 billion, reversing the net profit of HK$1.35 billion it reported in the first half of 2019. In July the group said that expected a net loss of about HK$9.9bn, on the back of a disastrous first half of the year that saw passenger travel demand plunge from the coronavirus outbreak.
Delta - Following United Airlines, another major U.S. carrier plans additional furloughs. Delta Airlines’ reportedly plans for 2,000 pilots to leave jobs in October 2020, after the $32 billion payroll aid to the industry by the U.S. government expires. The extensive changes to the employee structure are reportedly due to the slow aviation industry recovery after the COVID-19 crisis. Previously, 1,806 Delta’s pilots already took early retirement, but the company now says this was not enough to offset the situation. “The voluntary measures currently on the table just don’t move the needle enough. It’s with this reality that we, unfortunately, will move forward to furlough 1,941 pilots in October,” senior vice president of flight operations John Laughter allegedly wrote in an internal memo received by the New York Times. The U.S. Coronavirus Aid, Relief, and Economic Security Act (CARES) was established by the U.S. government as a payroll aid for employees to keep their jobs. As the deadline for CARES approaches its expiration date on October 1, 2020, some airlines have begun announcing plans for mass layoffs. There were talks of a $25 billion aid package for the U.S. airlines after a group of Republican senators backed the payroll assistance program’s extension on August 6, 2020. However, that deal remains at a standstill.
Qatar Airways - drops International CEO with overseas flights grounded The Qantas Group has revealed that the airline’s head of International services will leave the group as overseas flights will continue to remain grounded until at least mid-2021. In an official press release, Qantas Airways announced a reduction of its group management committee as part of its response to the expanding COVID-19 crisis. Tino La Spina, the CEO of Qantas International, will leave the Group in light of what is likely to be the extended grounding of this part of the airline. “Tino has done a superb job throughout his 14 years at Qantas. He’s a talented executive who brings his trademark enthusiasm to every challenge. I know I speak for the rest of the executive team and for the Board in thanking him sincerely for the huge contribution he has made, particularly as Deputy CFO and then CFO for most of that time,” said Alan Joyce, the CEO of Qantas Group. The Group announced that it made the decision to consolidate the domestic and international business units under a single divisional CEO. Whilst John Gissing, the Group executive of associated airlines and service, will continue to have a responsibility for the regional carrier QantasLink, the responsibilities currently held by La Spina, who leaves at the of August, will transfer to Andrew David, the CEO of Qantas Domestic. As it is stated by the CEO of Qantas Group, it will make significant changes in David’s role in the Group as a result, adding new responsibilities for Qantas International in addition to his existing duties for Qantas Domestic and Qantas Freight. According to the airline’s official statement released earlier in July 2020, Australian flag carrier planned to cut 6,000 jobs, that equated to about a fifth of the airline's workforce prior to the crisis, as well as grounding 100 planes for a year or even more. Around 4,000 of its 6,000 planned job cuts are expected to be finalized by the end of September 2020. The airline planned to be back to 40% of its pre-crisis domestic flying by July 2020, but, as the CEO of Qantas Group said, international routes would take much longer to return. “The COVID-19 crisis is forcing us to rethink our business at every level. It’s increasingly clear that our international flights will be grounded until at least mid-2021 and it will take years for activity to return to what it was before,” said Joyce. As another strategic crisis response, the Qantas group management committee took three months of zero pay in the last quarter of FY20 and is on reduced pay (65% for the CEO and 85% for other executives) until November 2020, reported the airline.
New restrictions COIVID found on frozen food- Protein exporters are facing bigger hurdles as a result of fresh discoveries of the Covid-19 virus on packaging. Last week, Chinese officials announced tightened controls and inspection requirements on meat and seafood imports after traces of the virus were found on packages of imported frozen food. Inspections last Wednesday also discovered the virus on frozen chicken wings from Brazil, extending concerns about frozen meat as a potential repository of the virus to poultry. The day before, Covid-19 traces were identified in the south-eastern city of Wuhu on packaging of frozen shrimp from Ecuador, which, in turn, followed another discovery on seafood packaging in the port city of Yantai on Monday. On Friday, the General Administration of Customs announced local companies must obtain certification that strict sanitary controls are in place for production, packaging and transport of the shrimp. To date, Chinese authorities have reported more than ten cases where the virus was identified on the packaging of imported frozen food since last month in various cities. They have stepped up inspections of imported frozen food at ports and other locations. Since the beginning of July, they have also imposed temporary bans on frozen food from 23 companies from various countries, including the US, UK, Brazil and Germany. At Chinese ports, the screening of all incoming reefer containers holding meat or seafood has caused bottlenecks and delays. Last month, Hapag-Lloyd advised customers that “import container pick-up activities have been severely impacted and as a result reefer plugs are highly utilized”, and asked them to pick up their containers as soon as they were released by customs. “Given the current situation your reefer container(s) may be discharged at an intermediate or alternative port and held there until it is possible to forward them to the designated port of discharge. Please note that all additional costs, risks and liabilities related to the storage or movement of the cargo after discharge will be for account of the cargo owner,” it warned. After the discovery of the virus on chicken wings in Shenzhen, the local municipal health commission warned the city’s population that they should be cautious when buying imported frozen meat products and aquatic products, and also announced plans to establish a closed-loop management system of the entire imported frozen food supply chain. But the problem may go beyond imported frozen food: Reshipped, the grocery chain arm of Alibaba, closed all its 21 outlets in Shenzhen after employees at one branch tested positive for Covid-19.The World Health Organization has reiterated its claim that it is “highly unlikely that people can contract Covid from food or food packaging”, but Chinese consumers are wary, some even steering clear of restaurants where seafood is served. And some retail markets in Guangdong province have removed all seafood products and some require Covid-19 tests of imported meat and seafood before it is sold.
Week 34 (August 17 - 23)
Etihad Airways - To operate passenger flights to Bengaluru, Delhi and Mumbai from 21 August.
Qatar Airways - Will operate flights between Doha and 13 Indian cities between 18-31 August; passengers must meet qualifications.
Canada: U.S. Border closure to all nonessential travel extended until 21 September.
Hong Kong: Travelers from China to be allowed to transit through Hong Kong Airport starting 15 August following COVID-19 ban.
South Africa: Inter-provincial travel resumes as government eases most remaining restrictions on economic activity from 17 August.
U.K.: Authorities extend COVID-19 lockdown in Aberdeen, Scotland.
United States: will extend ban on nonessential travel at land borders with Canada and Mexico through 21 September.
Week 33 (August 10 - 16)
“Capacity constraints have driven up rates for international shipments this year whether by sea, air or land, further complicating matters for supply-chain managers dealing with the effects of Covid-19 on their businesses.
The cost of moving goods by ship has climbed 12% in 2020 to the highest in 5 1/2 years, according to the Drewry World Container Index.
“Ocean-liner rates have benefited from the industry being more disciplined with idle capacity, coupled with support from general rate increases and peak-season surcharges,” said Lee Klaskow, a senior analyst with Bloomberg Intelligence. At the same time, “Asian exports are showing signs of improvement due to U.S. restocking activity.”
Limited passenger flights, which handle about half of the world’s airborne cargo, have created a significant reduction in available belly capacity, which has helped drive rates higher despite a decline in demand of about 19%.
Air-cargo rates from Hong Kong to North America almost tripled from the start of March to a record in mid-May as flights were grounded in worldwide lockdowns, TAC Index data show. While prices have fallen about 37% from the May peak, they’re still 60% higher than a year earlier.” – Bloomberg Supply Lines
Biman - The Covid-19 pandemic has forced Biman Bangladesh Airlines to suspend its move to acquire cargo planes in its fleet, despite the current potential for operating freighter services. In December 2018, Prime Minister Sheikh Hasina asked the Biman authority to start a freighter operation by acquiring two cargo aircraft. In the absence of freighters, the national flag carrier had been carrying cargo in passenger aircraft bellies. However, since the pandemic forced it to suspend passenger flights, Biman in mid-May converted passenger aircraft into full cargo flights, carrying boxes on passenger seats, in common with many airlines around the world. “There is no way to buy freighters now. Because the company itself is in ICU,” chief executive officer of Biman Bangladesh Airlines Mokabbir Hossain told The Loadstar. He said after the coronavirus spread worldwide early this year, the freighter purchase move did not see any progress: “The situation is not favorable.”Mr. Hossain said during the pandemic, Biman had been operating cargo flights to different destinations.
Cathay Pacific - In light of recently increased cargo operations, Cathay Pacific is to re-establish the position of director cargo. This is in line with its aim of becoming the “most customer-centric air cargo services provider in the world”. The role will be taken by Tom Owens, who has been director people for the past five years. The airline has also announced its annual management rotations. Nelson Chin, general manager cargo commercial for the past three years, becomes regional general manager for north-east Asia, based in Tokyo. Ronald Lam, chief customer and commercial officer, said: “I am happy that Nelson retains involvement with the cargo business and wish him every success in his new role.” He will be succeeded by George Edmunds, who has been head of revenue management operations for the passenger division. Mr. Lam said: “George has held posts in numerous geographies in Swire Group’s shipping business. These experiences stand him in good stead to steer our cargo business to a more digitized future and elevated level of customer responsiveness.”
Emirates - As the international market recovers, Emirates announced that it is adding one additional city to its Airbus A380 network. On August 6, 2020, Emirates announced that it will return to Toronto, Canada with one of its Airbus A380 aircraft. Starting August 16, the Dubai-based airline will fly from its Dubai International Airport (DXB) hub to Toronto’s Pearson International Airport (YYZ). The airline plans to operate five weekly flights. Toronto joins Amsterdam, Cairo, Paris, London and Guangzhou as cities served by Emirates’ Airbus A380 fleet. A favorite amongst its customers, according to the company’s press release, the Super Jumbo will return to more cities “in line with market demand and operational approvals,” reads the announcement. On August 5, 2020, Emirates reportedly permanently ceased its flights from Dubai to Adelaide, Fort Lauderdale, Buenos Aires and Santiago de Chile via Rio De Janeiro. The Fort Lauderdale service was established for connections to & from Latin America back in 2016 due to a partnership between Emirates and JetBlue. Emirates aims to gradually expand its passenger services to 70 cities in August, returning to over 50% of its pre-pandemic destination network.
Week 32 (August 03 - 09)
Fed-Ex - Pilots have called on the express company to suspend services to Hong Kong as a result of “unacceptable risks” related to the Covid-19 outbreak. The Air Line Pilots Association, Int’l (ALPA) has passed a resolution calling on their company to suspend operations in Hong Kong after pilots were forced into hospitals and government camps as a result of Covid-19. The union claimed that three Covid-19 positive asymptomatic FedEx pilots have been forced into mandated hospital facilities for up to 10 days in Hong Kong. Additionally, several pilots who already tested negative for Covid-19, but who had been in close contact with a Covid-19 positive person were put into government camps under “extremely difficult conditions”. Dave Chase, FedEx ALPA Master Executive Council chairman, said: “Not only do these situations pose unacceptable risks to our pilots’ safety and wellbeing, but they also create added stress and distraction for flight operations. “While the Covid-19 global pandemic rages on, FedEx pilots continue to provide essential services, operating in extremely challenging and ever-changing environments and constantly adapting to new government mandates and restrictions around the globe. “In Hong Kong, recent government mandates regarding Covid-19 testing have created unacceptable conditions for pilots, including our Hong Kong-based pilots and their families. “Pilots who test positive for Covid-19 face compulsory admission and treatment in government-selected public hospitals, with as many as five patients to a room with one shared bathroom. In addition, any pilot or family member in Hong Kong found to have been exposed to a Covid-19 positive individual is placed in a government quarantine facility for up to 14 days with very sparse provisions. “We are in contact with FedEx management as we advocate to protect the health, safety, and wellbeing of our crewmembers operating in Hong Kong. However, every day that passes with crews being exposed to these conditions is unacceptable. “In response, FedEx said the safety and well-being of its team members continues to be a top priority. “The situation in Hong Kong is dynamic as the Hong Kong government adapts its policies to prevent a resurgence of the virus there,” the express giant said. “We are fully engaged with government authorities to support our crew members in situations requiring medical treatment or self-isolation in Hong Kong. “Our operations in Asia Pacific are vital to our global network, and we are proud of the way our entire FedEx team has continued to operate through difficult circumstances to keep the global supply chain moving around the world.” This is not the first time US airlines have had issues with pilots flying into Hong Kong. Earlier in July, American Airlines and United Airlines temporarily suspended flights to the city because of regulations requiring all crew members to be tested for Covid-19 when they landed .Earlier in the week, the Hong Kong government announced new testing rules for flight crew as the city’s leader, Carrier Lam, warned Hong Kong was on the verge of a large scale community outbreak .air crew must test negative for Covid-19 an accredited laboratory with the specimen collected within 48 hours prior to boarding the flight to Hong Kong. Otherwise, the air crew must take a test on arrival at Hong Kong International Airport (HKIA) and wait for the test results there or at any other designated location. Carriers will need to ensure that crew self-isolate at a designated location in accordance with Department of Health’s requirements.
LATAM - The largest South American airline, has announced that due to the effects of COVID-19 pandemic over 2,700 of its workers are to be laid off. The company’s announcement came on July 31, 2020, after a round of unsuccessful talks with its workers union. A chance of voluntary departure will be offered, and the rced layoffs will begin on August 5. They will include not only ground crew, but pilots and flight attendants as well. According to the company, its pay was above average for the region, and reducing spending on wages is the only way to survive “the biggest public health crisis in history”. LATAM’s year-to-year passenger traffic decrease surpassed 95% in both May and June 2020, and the company already registered over $2 billion net loss in Q1 2020, even before the full impact of the pandemic.
UPS - Pilots are as concerned as those at FedEx, and have asked to be allowed to decline flight assignments to Hong Kong, which has tightened screening requirements amid an outbreak of Covid-19. Pilots are able to decline trips to mainland China and want that extended to Hong Kong, reports Freight waves. Earlier this week, FedEx pilots, via the Air Line Pilot Association, went further and called for a suspension of flights to Hong Kong.
Virgin Australia – Ceases all long haul flights! reorganization plan under voluntary administration includes mass layoffs, fleet decomposition and discontinuation of its subsidiary Tigerair Australia. On August 5, 2020, Virgin Australia revealed its plans for recovery from the Coronacrisis. The company underwent voluntary administration, as its revenues were depleted and it carried a lot of debt prior to the crisis. Despite unfavorable conditions, the Australian company managed to find new investors, namely U.S. based investment firm Bain Capital, willing to provide financial security to the airline in order for it to continue its operations. Virgin Australia plans to use this time of financial security for building “a stronger, more profitable and competitive Virgin Australia coming out of voluntary administration.” The press release highlights several strategies to help the company achieve this goal, including alignment of costs with the uncertain revenue outlook and reviewing contracts to match their future size. Furthermore, the airline will remove its ATR-72, Boeing 777, and the Airbus A330 in favor of a simplified all-Boeing 737 mainline fleet. The company also plans to cut 3,000 employees, hoping to re-hire them after the crisis averts, with an additional 3,000 new jobs on top. For now, long-haul international flights to Los Angeles and Tokyo will also be suspended until the market recovers, leaving Virgin Australia to focus on its core domestic and short-haul international flights for the time being. “Our aviation and tourism sectors face continued uncertainty in the face of COVID-19 with many Australian airports recording passenger numbers less than three percent of last year and ongoing changes to government travel restrictions,” said Virgin Australia Group CEO and Managing Director Paul Scurrah in the statement. Tigerair’s Airbus A320 aircraft will also leave the company’s fleet going forward. With a new roof of Bain Capital’s $AUD150 billion ($108 billion) of assets over its head.
Belgium: Antwerp, Belgium's most populous province, announced a curfew and other strict new regulations Monday as Belgium works to halt a dramatic rise in local coronavirus cases. The new measures will come into effect on July 29 and are set to be around for at least four weeks.