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Issue 2 2015 - Freight Business Journal


Container pool cuts cabotage costs


European Containers (ECS) entered into a cooperation agreement with Containerships in February. The companies aim to improve the efficiency of import and export flows within Europe by combining


their transport


networks. Containerships has 19 offices


across Europe, operating its own terminals in many countries and using its own fleet of ships, trucks


and containers where


possible. ECS, the Zeebrugge- headquartered 45ſt intermodal logistics operator specialising in transport between the UK, Ireland and mainland Europe, has a main hub at Venlo in the Netherlands and offices in Le Havre, Waterford and Novara, Italy. The partners will look for


synergies at sales and customer service level, starting with ECS’s appointment as agent for


Containerships in Italy. They also believe that sharing a common container pool will ensure better availability and reduce repositioning costs. “That will really help us here,


as we have been cabotaging empties into Ireland,” says Fintan Dawson, Ireland sales manager for Containerships. Cork is short of 45ſt units but there is a surplus in Dublin, he adds. The company relies on its preferred operators, Eucon and DFDS, to help reposition them. “Reefers are a bit of an issue so


we could reduce costs by sharing a container pool,” Dawson says. Containerships’ Irish traffic


grew 13% in 2014, with exports accounting for 53% of the total. “That’s a better balance than in previous years, which we strive for,” he says. Russia, Belarus, Finland and the


Baltic states are the company’s main markets. Sawn timber is a major westbound product out of Russia via the ports of Klaipeda and Riga. Dawson expects volumes to build in line with increasing construction activity in Ireland, assuming political tensions between Russia and the West do not intensify. Containerships is applying


a SECA charge of €100 per teu to cover the low-sulphur fuel regulation that came into force this year in its core operating areas of the Baltic and North Sea. This partly compensated the fall in the oil price, which leſt the operator’s BAF at minus €20 in February. “I would say 90% of customers


understand the logic, but it’s an administrative nightmare when you may be tendering for business for up to a year,” Dawson says.


///IRELAND Hard work and clever thinking


Dublin-based Johnston Logistics – Dachser’s Irish partner - has taken delivery of 12 double-deck trailers, six standard 13.6 metre trailer and three more trailers fitted with fold- away tail liſts. All carry the new “Johnston Intelligent Logistics” branding


and the additional


equipment reflects continued rapid growth for the company, whose turnover


reached €19.6


million last year. “We’re seeing a significant


turnaround and can definitely say the recession is over,” says sales manager Niall Hickey. The main source of growth is


multinational blue-chip clients rather than indigenous Irish companies, Hickey points out. But Johnston is having to work harder for its revenues. “No end user wants to have


money tied up in inventory. The trend is towards one pallet daily rather than a ten-pallet load,” he says. “That’s an opportunity for us to grow sales, but you have to be able to respond and margins are


Etihad win boosts IAM share


Etihad Airways grew its cargo volumes out of Ireland by 3% to more than 4,100 tonnes last year, thanks to twice-daily services direct from Dublin to Abu Dhabi. This put it third in the CASS rankings, behind only Aer Lingus and Emirates, says International Airline Marketing, which began acting as Irish GSA for the Middle East carrier last December. IAM can also truck large


shipments to Amsterdam, from where Etihad operates five freighter services per week to its Gulf hub. “It’s a major win for us and we


have taken on two new people specifically to look after the new account,” says Ian McCool, MD of IAM. Overall uplift ex-Ireland was


up 8.6% at 48,655 tonnes in 2014 while for IAM the increase was more than 14%, even ahead of the Etihad deal. McCool


estimates the company, which represents a number of other major carriers including American Airlines, Air Canada and Japan’s ANA, now has a 25% share of the outbound air freight market. Following its merger


with US Airways, American continued through the winter with


its previously seasonal


Dublin-Chicago service. The former US


Airways Dublin-


Philadelphia route has been maintained by the combined carrier and will increase to a wide-body from the end of March. “AA has opened a big new pharmaceutical facility in Philadelphia and a lot of temperature-controlled traffic goes into there,” McCool says. Equipment for the summer


schedule has yet to be confirmed, but with more B777s and 787s on the way, he expects New York and


Charlotte services to upgrade as well, offering Irish shippers more capacity. Air Canada has increased


its cargo volumes out of Ireland by more than 20% after introducing year-round services. “This means they can tap into good pharmaceutical allocations,” McCool says. Japan has been a strong


market, especially for main- deck cargo such as capital equipment decommissioned by Irish semiconductor plants. The carrier is looking to re-start services to Australia after many years off this route, which McCool sees as a potentially significant development for Ireland’s exporters. One of the main losers in


2014 was Delta, which lost ground after replacing a Dublin- Atlanta service, where it had a monopoly, with a New York routing that brought the airline


up against heavy competition. GSAs have long been


unhappy with the prevalence of air freight surcharges on which they do not earn commission, so McCool welcomes the return of all-in rates. “It was confined to one or two carriers to begin with but now applies to around about 50% of the business we do,” he says. Karl Louwrens director


of marketing and business development for IAM, reports that Translogic, a new sales agency for temperature control products established last year, is making gradual headway. The company offers temperature loggers which several forwarders are currently trialling, Kalibox insulated containers and TP3 pallet covers. These are now being used to protect pharmaceutical and perishable shipments in transit.


not where they should be.” Premium service providers


must seek to increase rates where possible to reflect their higher costs, and Hickey includes Johnston in this category. “We have made considerable investment in buildings, equipment and IT and must generate an adequate return,” he says. The company has built another


warehouse at its Rathcoole site, taking total pick-and-pack capacity to 17,000 pallets. But it is import-export traffic to and from


the UK and Europe that Johnston is looking for, with less focus on domestic distribution. Imports from its partner


Dachser’s main hub in Northampton


are up 35%


year-on-year, while Johnston linehauls three to four double- deck groupage trailers per day to Dachser’s Rochdale hub, described by Hickey as “our daily import-export gateway to Europe,” carrying mainly chemical, pharmaceutical and general industrial products.


The race is to the swiſt in the new Ireland


The recession has had one beneficial effect for the faster Anglo-Irish freighter operators, says Dachser UK managing director, Nick Lowe. “Companies that held stocks in both the UK and Ireland have cut back and taken stock out of Ireland. But because they are used to fulfilling next-day orders from stocks held in Ireland, that has increased demand for companies that can offer a fast service from the UK.” Dachser, together with its Irish


partner of eight years, Johnston Logistics, can offer a next day service from the UK to Dublin and 48-hours to the rest of the country. It offers


regular services from


its three UK depots at Dartford, Northampton and Rochdale into Ireland via Johnston’s Dublin area depot at Rathcoole and the rest of its Irish network which covers all the major Irish centres such as Cork and Waterford. Dachser operates a mixture of unaccompanied trailers via


Birkenhead from its Rochdale depot and driver accompanied units on the longer haul from Dartford and Northampton. Freight only ferries have to be used for some of the hazardous goods, and generally there is a good range of


ferry


services available. It’s always debatable whether


Ireland is an extension of UK distribution network or


part of


a wider pan-European market; there are companies that treat it as both, says Lowe. For Dachser UK, Ireland accounts for 10-15% of European exports, big in relation to the country’s population, but then Ireland is a very close trading partner of the UK. Traffic moving across the Irish


Sea is quite a mix he adds – sports apparel, car parts and electronics out of the UK, and chemicals in both directions. The Irish customer base is especially varied – anything from small family firms to multinationals that have set up operations in Ireland.


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