Gargantuan logistics projects on Sakhalin Island

The Panalpina magazine 1 | 2003 

<strong>Gargantuan</strong> <strong>logistics</strong> <strong>projects</strong> 

on Sakhalin Island

connect 1 | 2003 

2 

interview 

Profitable growth – Roland Wider talks 

about his new area of responsibility 

and his goals 

oil & gas 

Oil <strong>logistics</strong> on Sakhalin – Panalpina 

Oil & Gas handles huge <strong>logistics</strong> project in 

Russian Far East 

oil & gas 

By barge to Kazakhstan 

– Knocked-down drilling rig moved 

<strong>projects</strong> 

Giant US diesels cross the Atlantic 

airfreight 

Highlights of ACF 2002 


Mind the gap! – Metro trains 

flown to China 

human resources 

Bringing the strategy to life 

– CEO Bruno Sidler addresses 

all staff in video 

worldwide 

page 4 

page 6 

page 12 

page 24 

page 26 

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2261111. Responsible for contents: Martin Spohn and Christoph Rytz. Editor: Martin Spohn. E-mail: 

martin.spohn@panalpina.com. Distribution: Monika Dups: E-mail: monika.dups@panalpina.com. Publication 

intervals/languages: ‘connect’ is published several times a year in German, English, French, Spanish and 

Chinese in over 100 countries. Total circulation: 60 000 copies. Photos: Peter Maurer, Weisslingen: p.19 

top left, p.25, p.26 top, p.27 bottom, p.29 bottom left, p.32; Julian Salinas, Basel: p.3 (Bruno Sidler), p.4; 

Rolf D. Sulser, Basel: p.19 top right and bottom; Envirotainer: p.28 bottom. Getty Images: title page p.16 

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Basel. Printed on 100% chlorine-free bleached paper. 

page 14 

page 18 

page 20

Bruno Sidler 

President of the 

Executive Board 

and CEO 

Gerard W. Fischer celebrated 

his 70th birthday in March 

Pioneering spirit 

and dedication 

Ladies and gentlemen 

The cover story of this edition of connect is about the exciting developments 

on the island of Sakhalin, way out in the far eastern corner of the 

Russian Federation, where Moscow is 6 time zones away and where 

the proximity of the potent energy markets of Northern Asia bear the 

promise of a bright future. 

Panalpina has a history and an impressive track record within the oil 

patch, so it is no surprise that we were investing in presence and infrastructure 

on the island as far back as 1997. The early days were prone to 

long winded processes, and lots of patience and stamina was needed to 

ride out the dramatic changes from a Soviet style 

bureaucracy to a market oriented energy development policy. Today 

we are proud to be the leading <strong>logistics</strong> provider to Sakhalin and our 

international clients are able to profit from our profound local know-how. 

This is further compounded by solid partnerships with local subcontractors 

plus excellent relations with the local government and the 

customs authorities. 

Long-term thinking and stamina are a must if you want to be a serious 

player in a vertically integrated industry such as oil & gas. This is 

not only valid for this particular key industry, but is the very essence of 

Panalpina’s approach to its core business. 

This is further illustrated by the interest and involvement of our top 

management in the business of our customers, and it is therefore no 

surprise that our Chairman Gerard W. Fischer accompanied me on a 

trip to Eastern Siberia and Sakhalin Island in September last year. 

Our Chairman, who is celebrating his 70th birthday in March, has been 

instrumental in building up the oil & gas competence within our group, 

and has been very supportive of the company’s drive to establish its 

network in the emerging production areas of the Russian Federation 

and Central Asia. 

Gerard W. Fischer has been a pioneer in many respects and his 

achievements are many. The spirit exhibited by our staff on the 

island coincide with many of his own values, which are embedded in 

our corporate culture. We need to remember where we come from and 

we need to concentrate on what we know best, but most of all we need 

to have people who are prepared to go to places like Sakhalin. 

Mr. Chairman, we are proud of you and we salute you on your birthday! 

Yours sincerely, 

Bruno Sidler 


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4 

Growth must 

Roland Wider on his new job and his 

objectives as Panalpina’s CFO 

Mr. Wider, you have been 

Chief Financial Officer 

of Panalpina since the 

beginning of September. 

What particularly attracted 

you to the job? 

First it was naturally the job itself: taking 

responsibility as CFO for the financial area 

and actively helping to shape the future of 

a very successful group. Having spent ten 

years abroad myself (in Taiwan, Thailand 

and Hong Kong), I find the international 

environment especially important. Also I 

think the freight-forwarding sector is extremely 

interesting and exciting. What particularly 

appeals to me about Panalpina is its 

flat hierarchies and its open, uncomplicated 

management. I was also impressed by the 

atmosphere at Panalpina, which despite 

its size is just like one big happy family. 

With its personal experience of the <strong>logistics</strong> 

business, management knows exactly what 

the people at the sharp end are doing. This 

practice-oriented management approach is 

exactly my style. It’s a problem for me when 

executive territory is teeming with consultants 

closeted with top management and 

thinking up all sorts of academic theories. 

Panalpina puts service to the customer first, 

at every hierarchical level. 

So your first impressions 

are positive? 

Absolutely, my expectations have been 

more than fulfilled: I’m certain I made the 

right decision. The working atmosphere is 

very pleasant, and the ambience is open 

and congenial. I may not have been here 

long, but already I can clearly sense this ‘Panalpina 

spirit’. Even at group-management 

level, discussion is frank and open, and you 

sense the readiness of all concerned to work 

together to achieve the common aim. This is

e profitable! 

not something that can be taken for granted, 

and even as a newcomer to the field I find 

my colleagues receptive to my ideas and 

inputs. 

What’s on your list of 

priorities? 

First and foremost, we need to use the 

advantages arising from our regionalized 

management structure, not least in financial 

respects, and work in greater proximity to 

the local market. This is not yet being done 

as much as it should be. As part of this we 

must carefully nurture and encourage our 

local staff. We have a highly motivated, 

technically competent team, and we must 

capitalize on them by every means at our 

disposal – for example by offering interested, 

talented staff more opportunities to improve 

their qualifications and by involving them in 

decision-making processes. 

Another priority is to steadily 

improve data quality and increase transparency. 

Among other things, that means 

standardizing and simplifying the reporting 

system. 

Apart from that, in future we shall attach 

even more importance to risk management 

than we did in the past. The specific 

measures I have in mind include hedging 

currency risks, and credit control in the context 

of accounts-receivable management. 

Which do you prefer, 

organic growth or growth by 

acquisition? 

Obviously it depends on the situation. 

Growth is very important, but whether it 

takes place organically or by acquisition 

must always hinge on the circumstances, 

risks and opportunities of each case. What 

matters most of all is that growth must be 

profitable, and at all levels. Growth for the 

sake of growth is not an option. 

Corporate governance is on 

everybody’s lips. How do 

you approach the subject? 

You’re right, a great deal is being said and 

written about corporate governance at the 

moment – particularly because of certain dubious 

business practices that really do give 

us all cause for thought. But basically the 

subject is by no means new. It’s just a matter 

of companies and their management teams 

concentrating on fundamental values, values 

that must be upheld as a matter of course. 

One example is fulfilling the responsibility 

that has always existed – and still exists 

today – vis-à-vis our employees, customers, 

partners, financial backers and the public. 

Fundamental values like honesty, openness 

and transparency haven’t changed, but they 

have to be lived – for example by presenting 

facts as they really are. 

What qualities do you 

consider to be Panalpina’s 

particular strengths? 

Panalpina pursues a clearly defined strategy, 

concentrating on its core business. This is 

an enormous strength. We do not try to grow 

at any price, expanding into areas that we 

do not adequately understand. We can also 

react very rapidly and flexibly to market 

changes, because of our flat hierarchies and 

because we are asset-lean – which means 

we have very little capital tied up. On top of 

that we are almost 50% self-financing, a very 

sound position, and are well-prepared for a 

difficult economic environment. But most 

important of all – and this struck me very 

quickly – are our highly motivated, technically 

competent employees. I am convinced 

that employee satisfaction leads to customer 

satisfaction. And the reverse is also true: 

without employee satisfaction, customer 

satisfaction is impossible to achieve! 

interview 

What is it about your 

profession that excites you? 

Everything, actually! I’ve always worked in 

finance, a field that I find fascinating. But it’s 

not enough to concentrate entirely on the financial 

sector within a company. I also need 

to understand the operating business – that‘s 

essential for a good financial expert. Putting 

this principle into practice is not easy, but 

it’s very satisfying. Suffice it to mention the 

contact it gives me with very many people. 

Panalpina is a highly international concern: 

we are active not only in many countries 

but in many different cultures. This makes 

the work uncommonly varied. And another 

thing: at Panalpina suggestions for improvement 

are seen not as criticism but as a 

challenge, and accordingly they are treated 

constructively. I find that both appealing and 

motivating! 


5


6 

Oil <strong>logistics</strong> 

on Sakhalin 

When the Russian playwright Anton Pavlovich 

Chekhov visited Sakhalin in 1890, it 

was for a seven-month survey of the penal 

colony the Tsarist rulers had created in 

the Russian Far East. Then home to more 

than 10 000 convicts and exiles, it was the 

source and inspiration for the 300 pages 

of Chekhov’s ‘Sakhalin Island’ his personal 

view of one of the harshest outposts of the 

Russian empire. 

Eight years after the founding of 

Vladimirovka (the present day Yuzhno- 

Sakhalinsk) in 1882, Chekhov wrote to his 

publisher friend Aleksei Suvorin. …‘you write 

that no one needs Sakhalin and no one cares 

about it… I’m sorry I’m not more sentimental, 

else I would say it is to places as Sakhalin that 

we should go to worship’. He later described 

the island as ‘the most depressing place in 

our land I have been.’ So why more than 100 

years later is Panalpina investing time and 

considerable resources in Sakhalin islands? 

Why is ASB-Air making daily charters from 

Luxembourg and eight-hour flights from

Vast oil reserves: Oil exploration 

on Sakhalin Island in the Russian 

Far East presented Panalpina 

Oil & Gas with a <strong>logistics</strong> challenge 

on a gargantuan scale. 

Moscow? The answers lie under the waters 

of Sakhalin as well as in the warm coastal 

waters of West Africa. 

The giants of the oil world 

Oil and gas were there when Chekhov 

left Sakhalin and long before he mused 

that no one needed the place. It has taken 

the giants of the oil world ExxonMobil, Royal 

Dutch/Shell and a consortium of Russian interests 

to dispel that view. Sakhalin is now 

one of the world’s richest oilfields and for the 

next few decades will need all the help it can 

get. There are more than 420 000 people living 

on the island, the majority based in the 

capital Yuzhno-Sakhalinsk, but the island is 

also home to a colony of Europeans, Americans 

and Japanese who make the oil and gas 

industry live. 

Erik Hutter, Senior VP in charge of 

the company’s global oil and gas services, 

and his team of industry specialists pointed 

out early in 2002 that Exxon were looking for 

reliable services that would make life easier 

by Mike Godfrey* 

oil & gas 


7


8 

and more productive for the oil industry 

in the Russian Far East. ‘When we spoke 

with them, they really wanted a complete 

<strong>logistics</strong> chain, an ongoing process that 

will service their operations in this remote 

region. With our background in the oil and 

gas stretching back more than 40 years in 

Houston and Africa, we knew we could offer 

them what they wanted.’ 

West African coastal 

services 

Panalpina’s oil and gas experience 

stretches back to the 1970s when West Africa 

– in particular Nigeria – was an oil region 

served mainly by small boats and chartered 

aircraft from ASB-Air out of Luxembourg. 

Expansion of the business came through 

bunker deliveries to the offshore oilrigs at 

the end of the 1980s and the growth in intercoastal 

delivery services using a converted 

speedboat for delivering up to 50 tonnes in 

one run. 

The expansion of the company’s 

sea services in the region meant a growing 

reputation and an expansion into the 

Middle East: Dubai, Saudi Arabia and Bahrain 

followed in the early 1990s. This was the 

stepping-stone to the Russian oilfields. As 

Panalpina’s reputation grew worldwide, it 

was also experiencing a growing awareness 

of its capabilities by those involved in the 

oil industry in Houston. It was here that the 

idea of a partnership and joint <strong>projects</strong> with 

Crowley Marine Services was formalized. 

Worldwide means more than geographical 

location though, as the ability to service 

and support is enhanced by an understand- 

ing of the oil and gas industry. The proof 

of this is highlighted by the knowledge of 

Panalpina staff worldwide. Put in your own 

people, says Erik Hutter, but make sure they 

work with the locals. On Sakhalin, this has 

become part of the overall strategy and is 

already paying dividends. 

Exemplary cooperation 

Although the first oil from Sakhalin 

is not expected to flow before 2005, the oil 

companies and Panalpina have been on the 

island for a number of years. The Sakhalin 

consortium that is drilling for oil was formed 

in 1995 by a raft of foreign companies from 

Japan, the USA, India, the Netherlands and 

the UK. Russian interest in the consortium 

and oilfields is of paramount importance 

both to the local populace and the power-

okers in Moscow. It has been a real case 

of cooperation and mutual support as the oil 

giants have formed alliances and partnerships 

with local companies and enjoyed the 

support of the Russian President Vladimir 

Putin. His insistence that foreign oil investment 

be increased, has led to an increased 

demand for local knowledge, contractors and 

<strong>logistics</strong>. Yet the real power needed and the 

real support has had to be brought in by air 

and sea. It is here that Panalpina has taken 

the lead and established itself as the leading 

<strong>logistics</strong> player for the oil and gas industry 

in the region. 

Logistics solutions spring 

into action 

The establishment of Panalpina 

Sakhalin Projects was the response to the 

Alla Polischuk, 

Branch Manager 

Yuzhno-Sakhalinsk, 

and Peter Manger, 

Director Russian 

Far East 

oil & gas 

Panalpina CEO Bruno 

Sidler in Yuzhno- 

Sachalinsk with Roman 

Kristhal, President 

Atran Cargo Airlines 

(second from right), the 

airfreight partner of 

Panalpina in Russia. 


9


10 

The oil 

companies and 

Panalpina have 

been working 

on Sakhalin for 

some years. 

Russian request for at least 70% project 

content and 80% manpower content and 

it is this operation that is designated to 

handle the logistical services onto Sakhalin. 

When ExxonMobil confirmed the potential 

of the oil and gas reserves in late 2001, it 

was the signal for the support services to 

begin operations on a grand scale. For Panalpina 

this was not really news. Erik Hutter 

and his team have been involved with this 

project since 1997 thanks to the company’s 

increasing importance in the Houston oil 

industry. But it is at the coalface that the 

true face of Panalpina is most visible, with 

General Director Tom Moeller and Russian 

Far East Director, Peter Manger, based in 

Yuzhno-Sakhalinsk. 

These are people who know the location, 

understand the people and can bring 

influence to bear to achieve the results the 

industry expects. In the words of Erik Hutter, 

‘you have to know and be known in the 

market and you have to talk their language.’ 

That language on Sakhalin translates the 

‘would like’ into the ‘can and will do’. Panalpina 

has shipped more than 135 000 freight 

tons onto the island last year, the majority of 

it headed for the site of the latest oil drilling 

operations at Chayvo Beach. The approach 

from Exxon to move the world’s largest drilling 

rig to Sakhalin from Texas, came through 

Panalpina’s oil and gas operations center in 

Houston. Although the transportation of the 

land-based rig was handled by Panalpina 

Houston, the Russian part of the operation 

was run by Panalpina Sakhalin Projects. 

This was a true partnership in every aspect, 

with the joint venture with Crowley Marine 

Services a vital part of the beach landings 

at Chayvo. 

The windswept coast of 

Chayvo Barrier Island 

Ask Peter Manger about the place 

and he nods knowingly about a deserted and 

very windswept beach on Chayvo Barrier Island. 

The site of the current extended reach 

drilling project, it is a barren site on which 

Parker Drilling Company are now operating 

the world’s largest land rig. Getting the rig to 

Sakhalin and onto the beach was the culmination 

of a detailed project by Panalpina and 

partner Crowley Marine Services from Houston 

during the latter part of 2002. Using the 

MS Freya, more than 54,000 cubic meters 

of drilling rig, camp and rolling stock were 

transported in little more than 25 days to the 

outer fringes of the beach-landing site. The 

cargo included not only the 31 000 freight 

tons of rig, but nearly 15 000 freight tons of 

drilling camp – vital for the workers when the 

harsh Siberian style winter descends. The 

biggest land rig in the world it may have 

been, but the power of the seas was enough 

to delay landing for a further two weeks. 

Heavy swells postponed the original 

landing and it was not until mid October that 

the combination of 100 x 400’ barges and two 

250 tonne lift cranes managed to land the entire 

cargo onto the beach. The joint venture 

with Crowley Marine Services is another example 

of the flexibility shown by Panalpina 

to fully support the oil industry in the Russian 

Far East. During his visit to Sakhalin in 

September 2002, CEO Bruno Sidler pointed 

out that Panalpina has a commitment to establish 

a long-term relationship with Sakhalin. 

We have been involved in the oil industry 

for the past 40 years and in all the difficult 

places in the world! An amusing aside, but 

in reality a strong statement that reflects 

the intense planning that is still shaping the 

Sakhalin logistical plan. 

USD 12 billion invested 

The talk is mostly of 13 billion barrels 

of oil lying beneath the waters of the island

Over 54 000 cubic meters of 

freight were transported to 

Sakhalin by ship. 

and how more than $12 billion will be needed 

to ensure that it comes out. What is less well 

known or spoken about are the statistics that 

make up the complete oil and gas exploration 

picture. Getting the essential supplies 

from Moscow, Tokyo, Houston and Europe 

to Sakhalin is not as easy as planning to do 

it. Distances are great, but Panalpina has 

the support of an ace card in its pack – the 

company’s own in-house carrier ASB-Air. 

Wolfgang Meier, Executive VP of ASB-Air, 

supports Erik Hutter’s view of experience 

backed with understanding. ‘Lots of people 

can move freight, lots of people can fly in 

and deliver. What we offer is the flexibility 

to tailor our services to what the oil companies 

want. It’s this mixture that makes our 

support of the oil industry on Sakhalin work. 

The market tells us what they want – and 

we deliver.’ 

Comprehensive supply 

network 

The 59 000 tonne Orlan offshore 

platform is expected to be operational 

sometime in 2004 and will form the next 

phase of Panalpina’s support operations in 

the region. ASB-Air is already providing air 

charters onto Sakhalin via Incheon, Seoul, 

Vladivostok and Luxembourg, as part of a 

comprehensive supply network. With supplies 

coming in from the USA and Europe, 

the infrastructure will grow and – in line 

with predictions – the scope and demand 

for support services will increase accordingly. 

For the company, Sakhalin will grow 

and the oil and gas industry will expand 

in line with Putin’s hopes and Panalpina’s 

expectations. 

Bruno Sidler’s observation in Yuzhno-Sakhalinsk 

that it had taken a long time 

to develop the structure in the Russian Far 

East, was a statement of commitment from 

Panalpina. ‘Those of you who have been on 

Sakhalin for a long time will know that we are 

not new to this industry. For the past 40 years 

we have worked in all the difficult places in 

the world you work in. Our presence here to 

support you is a statement of faith about your 

business and the prospects for the region.’ 

It’s not Chekhov, but very much spot on.» 

*Mike Godfrey is a freelance 

journalist and lives in London. 

oil & gas 


11


12 

By barge 

to Kazakhstan 

Transshipment in 

Mariupol: Panalpina 

organized the transfer 

of a knocked-down 

oil drilling rig to a 

manmade island in the 

Caspian Sea. In recent 

years, the Group has 

steadily expanded its 

presence in the CIS 

countries and Central 

Asia. 

On behalf of Pride International, one of 

its key accounts, Panalpina Oil&Gas has 

moved a drilling rig originating in Houston, 

Texas, from the Black Sea port of Mariupol 

to Kazakhstan. The final destination was an 

artificial island in the Caspian Sea off the 

Kazakh coast. 

On arrival of the ocean-going vessel 

at the Ukrainian port of Mariupol, Panalpina 

took over the 9000-cubic meter, 2000-tonne 

consignment and organized transshipment 

onto three barges. These took the rig through 

the Don-Volga canal, passing from Ukraine to 

Russia and finally to Aktau in Kazakhstan. 

Following customs clearance at Aktau, the 

equipment was transferred to the manmade 

island. The rig, which had been dismantled 

prior to shipment, then had to be reassembled 

according to detailed plans.

‘You have to be 

familiar with the 

business, the 

companies involved 

and how everything 

fits together’. Yuri 

A Kichigin, project 

manager 

Spot-on timing 

Precise timing was of the essence, as 

the various legs of the journey had to follow 

a strict schedule. Early or late delivery would 

have interfered with construction work and 

incurred high costs. Panalpina made sure 

that the barges arrived in Mariupol during 

the appointed time windows and were 

loaded with the freight held in interim storage 

on the quays in 24-hour shifts. No sooner had 

the first barge left on its canal journey than 

the second one arrived in Mariupol and the 

same procedure was repeated for the third 

shipment. In addition to the port cranes, 

floating cranes brought alongside the vessels 

were used for transshipment of the bulky rig 

components weighing up to 50 tonnes each. 

It was important to ensure that the freight 

was firmly lashed to the decks, and customer 

representatives were present to supervise 

the operation. 

In addition to the structures loaded 

onto barges in Mariupol, further goods 

(mostly containerized) were delivered by a 

oil & gas 

Don-Volga vessel. Moreover, mobile equipment 

such as trucks, cranes and building machinery 

arrived in Aktau by rail. The freight 

then proceeded to the manmade island on 

roll-on/roll-off vessels. 

Know-how and networking 

Performing services for the global 

oil and gas industry is one of Panalpina‘s 

core competencies, so it has considerable 

experience and know-how in this field. The 

Panalpina Oil&Gas business, which employs 

some 800 people, operates globally and has 

carried out assignments in a large number of 

countries, including Saudi Arabia, the United 

Arab Emirates, China, Indonesia, Thailand, 

Vietnam, Nigeria, Angola, Gabon, Congo, Algeria, 

Morocco, the UK, Norway, Venezuela, 

Columbia, Brazil and the USA. Over the last 

ten years, Panalpina has steadily expanded 

its presence in the CIS countries and Central 

Asia. According to Yuri Kichigin, project 

manager at Panalpina St. Petersburg, ‘Panalpina 

has proactively developed the necessary 

infrastructure for these operations, and 

employs an international team of specialists 

with in-depth knowledge of the oil and gas 

industry. That’s essential for the smooth 

handling of a consignment like the one for 

Kazakhstan.’ He stresses that ‘anyone who 

wants to operate successfully in the oil and 

gas industry must not only be familiar with 

the business, but must know the companies 

involved and how everything fits together and 

has to be flexible and quick off the mark.’ 

As Kichigin recalls, ‘Panalpina has 

been operating in this segment since the 

1950s, and can draw on a huge fund of knowhow 

accumulated while building up the CIS 

and Central Asian bases. You can’t acquire 

that sort of expertise overnight.’ This local 

knowledge is also essential when selecting 

the right partners at all the various interfaces 

and at the reassembly sites – a task that has 

to be addressed long before the freight is actually 

shipped. According to Yuri Kichigin, 

Panalpina experts inspected all the sites in 

person and chose the company’s partners 

themselves by adopting a best-in-class approach. 

‘Every rig move is unique and thus 

calls for customized solutions’, says Kichigin. 

‘Depending on the conditions prevailing, we 

decide on a case-to-case basis whether to set 

up a local office on site or whether a mobile 

team is sufficient for supervising operations 

in close cooperation with local staff.’ 


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14 

Big U.S. diesels 

make tracks 

ASB-PanProjects has been 

transporting global shipments 

on behalf of GETS for years 

A heavy load: GE Transportation Systems 

(GETS) in Erie, Pennsylvania, is a major client 

of the Panalpina subsidiary ASB-PanProjects, 

which specializes in project assignments. 

GE Transportation Systems, which is headquartered 

at Erie on the southern shores of 

the eponymous Great Lake – has regularly 

requested the Panalpina subsidiary ASB- 

PanProjects to ship heavy diesel locomotives 

and other equipment from the United States 

to destinations around the world. The most 

recent major assignment involved delivering 

77 locomotives for a privatized rail operator in 

the Baltic states. To handle this prestigious 

project, Panalpina chartered space on a total 

of six vessels over a six-month period, each 

of them providing capacity for between ten 

and 14 locomotives. 

Stowed below deck 

The locomotives had previously 

been in service with various railroad companies 

in North America. The type C30-7 and 

C30-7A locomotives underwent a complete 

overhaul in an assembly shop in Mexico to 

prepare them for service in Estonia. Mounted 

on temporary bogies, they were then transferred 

overland to the port of Beaumont in 

Texas. 

On arrival at Beaumont, the locomotives 

were prepared for their voyage across 

the Atlantic and through the Baltic to Tallinn. 

Among other things, this involved disman-

tling and sealing the brakepipes. In addition, 

the 125-tonne engines were treated with a 

rust-protection spray to protect them from 

the corrosive action of the sea air. Moreover, 

all the locomotive were stowed below deck. 

Panalpina had special ‘transport pyramids’ 

developed to facilitate shipment of the locomotives 

and their bogies. These pyramids 

allowed two 27-tonne bogies to be stowed on 

top of each other in the ship’s hold. 

Straight to Eesti Raudtee 

The journey across the Atlantic and 

through the Baltic to Tallinn took about three 

weeks. The first task on arrival was to lift the 

bogies straight onto the dockside rail tracks. 

Then, the ship’s heavy-lift cranes were used 

to lift the locomotive chassis out of the hold 

and onto the waiting bogies. Coupled together 

into convoys of 4-6 locomotives, the consignments 

made their way to the assembly 

shops of the Estonian railway company Eesti 

Raudtee (EVR), which brought them into 

service some two weeks later after recommissioning, 

final assembly and testing. 

Panalpina’s project specialists at 

ASB-PanProjects organized all the freight 

movements, from the assembly shop in Mex- 


On arrival in Tallinn, the 

locomotives were 

immediately handed over 

to their new owners 


15

connect 1 1 | 2003 

16

Photo: gettyimages 

ico through to delivery at the port of Tallinn. 

Among many other activities, this included 

customs clearance and the chartering of 

the vessels. During the preparatory phase, 

staff at ASB-PanProjects prepared detailed 

surveys for evaluating the best route and 

suitable transhipment ports for the Mexico- 

Estonia trip. 

Previous destinations: Brazil 

and Australia 

The Estonia-bound consignments 

were not the first project of this type. The 

ASB-PanProjects branch at Morristown (NJ), 

not far from New York, has been handling 

project commissions from GE Transportation 

Systems (GETS) to destinations around the 

globe for some years. In addition to locomotives, 

spare parts are continually being 

shipped around the world. 

For example, Panalpina has moved 

components for about 50 locomotives to 

the Adtranz/GE works in Kassel, Germany, 

where they were assembled and delivered 

direct to customers. It has also transported 

heavy Dash 9-44CW locomotives (each of 

which generates some 4400 hp) for use in 

Australian mines. At the Hamersley Iron 

project in Western Australia, these locomotives 

are used to haul iron ore along a 638-km 

line linking several of the company’s mines 

with the port of Dampier. The iron-ore trains 

weigh a total of 24 000 tonnes and are about 

2.3 km in length. 

The Matto Grosso region of Brazil 

is another destination for Panalpina’s locomotive 

shipments: in 1997-98 it moved 50 

locomotives from Philadelphia to Santos and 

then onwards overland for delivery to the 

Ferronorte Railroad Company. These Dash 

9-44CW locomotives, also originating from 

the GE factory in Erie, arrived punctually at 

the assembly shops in Brazil. Other <strong>projects</strong> 

have been handled for companies in Canada 

and Kazakhstan, as well as for the mining 

company CVRD in Brazil. 


Panalpina used a total of 

six ships to transport the 

77 locomotives to Estonia. 

10-14 diesels were stowed 

below deck on each vessel. 


17


18 

When will business in the airfreight sector 

pick up? The International Air Cargo Association 

(TIACA), organizer of ACF 2002, 

looked to the global experts gathered in Hong 

Kong for an answer. Asked about prospects 

for a rise in freight volumes over the next 12 

months, 55% of the conference participants 

declared themselves optimistic, 10% even 

very optimistic. 28% were undecided, while 

the remaining 8% wanted to know what was 

meant by ‘growth’. 

These reactions are likely to be 

representative as, according to TIACA, 70% 

of the 4000-plus ACF participants flew in to 

Hong Kong from Europe or the USA. The 

mood among the different contingents varied 

substantially. While, one year on, the Americans 

remained transfixed by the events of 

September 11, 2001, the Europeans were 

more concerned about the new regulations 

Washington might impose on global trade in 

the aftermath of 9/11. Having weathered their 

domestic crisis, the Asians pragmatically 

focused on current business in their booming 

home markets. That Asian confidence 

inspired the whole Air Cargo Forum in Hong 

Kong is the good news. 

Cyclical business 

The bad news is that the crisis persists. 

28% of the forum participants expected 

an upswing after one year, 41% after two, 19% 

in the fourth year at the latest, 7% in the fifth 

and 5% later still. 

Highlights of 

ACF 2002 

Three issues topped the agenda at the 21st International 

Air Cargo Forum (ACF 2002) in Hong Kong: the crisis in 

the airfreight sector, security in the sector, and freight 

exchanges. This article looks at the highlights of the forum 

discussions. 

by Rolf D. Sulser* 

Attention was drawn to the inherently 

cyclical trends in the airfreight sector 

– and faltering trade even before September 

11, 2001 – by Ting Ho (Logistics Ventures) 

and Douglas Harned (McKinsey & Co.), who 

pointed to the cargo volumes between January 

and August 2001. According to Harned, 

the cycles in the airfreight business are 

slowing down and the loss periods becoming 

longer: a single loss year in 1970 was 

followed by two during the 1974/5 oil crisis, 

four in the 1980s and five in the 1990s. In his 

view, these downturns were home-grown, 

triggered by overcapacities among airlines 

and a consequent slump in revenue. At present, 

there are 9.5% too many cargo planes, 

compared to 5.7% in 1992 and a mere 3.8% 

in 1990. 

What might spark the recovery? 

The speakers at ACF 2002 all agreed that 

their sector could hardly kick-start the global 

economy on its own. One priority, however, 

was the elimination of obstacles to an upturn. 

Ned Laird (Cargo Facts) called for an 

end to airfreight’s dependence on bilateral 

passenger-sector air traffic agreements. David 

Cunningham (FedEx) went further still, 

demanding open skies for all instead of some 

3000 bilateral aviation pacts worldwide. As 

quality largely stems from ground-based 

activities, he demanded round-the-clock 

operation of airports, streamlined customs 

formalities, well-trained staff and an acceptable 

system of charges and levies. 

Airfreight as a security risk? 

According to a further poll conducted 

at the ACF 2002, the security issue 

ranks a mere third (with 14% of the vote) 

among the problems facing the sector, behind 

revenue (31%) and regulations (25%). 

43% of participants wanted to pass on additional 

security costs to the shippers, 42% 

to the governments. Sudheer Raghavan (SIA) 

spoke out in favor of the latter: ‘Politicians 

create terrorists, so they should pay the resulting 

cost.’ 

Stephen Tisdalle (PWC Consulting) 

rocked the assembly with his contention that 

‘airfreight is the weakest link in a passenger 

aircraft’s security chain!’ This allegation was 

leveled chiefly at the USA, where ‘frequently, 

to pass as a known shipper, you only have 

to dispatch one package every few weeks’. 

Tisdalle demanded implementation of the 

standard European ‘known shipper’ system 

with its central database and selective x-raying 

of consignments. 

He rejected the wholesale x-raying 

of air cargo as this would cost USD 7.4 

bn in the USA and cause three-quarters 

of consignments to miss their scheduled 

flight. Tisdalle noted that a general ban on 

freight shipments by passenger plane would 

cost airlines 25% of their turnover and spell 

doom for many. This point was underlined 

by Michael Wisbrun (KLM), who predicted 

that a ban on belly-freight would result in 

the scratching of 80% of all destinations and

90% of services, while sounding the deathknell 

for many – even healthy – airlines. 

Supply-chain concepts would no longer be 

feasible; forwarding costs for shippers would 

skyrocket. The sole beneficiaries would be 

freight-only carriers and integrators. 

Ian Gilchrist (Hill & Associates), on 

the other hand, addressed practical security 

issues. ‘Security personnel at airports are 

the poor relation of the entire sector: badly 

paid, inefficient, inadequately managed and 

hardly trained,’ was his devastating verdict. 

‘The warnings issued by security officers are 

unspecific and belated, and aren’t passed 

on.’ 

John Mascaritolo (NCR) described 

the impact of 9/11 as follows: ‘Within minutes 

of the attacks on the Twin Towers, 

public attention was focused on <strong>logistics</strong>. 

All of a sudden, globally operating shippers 

found themselves embroiled in the war on 

terror.’ He warned forwarders against indiscriminately 

passing on additional charges: 

‘Shippers have a right to know why and by 

whom these are levied.’ 

More money only for more 

value 

Additional costs and their often dubious 

justification – this was one key issue 

addressed by Robert Frei (Panalpina). His 

criticisms centered on IATA Resolution 502, 

with which the airlines propose to change 

the conversion factor for volumetric charges 

from 6000 cm 3 /kg to 5000 cm 3 /kg. Frei accused 

them of trying to ‘improve their own 

results without creating any added value’. 

As he saw it, however, market forces would 

solve the problem. Frei was particularly aggrieved 

at their – initially unsuccessful – attempt 

to enforce the resolution unilaterally 

as of October 1, 2002. Sudheer Raghavan 

(SIA Cargo) concurred on this point, calling 

for a ‘wider discussion of such fundamental 

changes’. 

Frei similarly warned the airlines 

against attempting to impose ‘higher-revenue’, 

i.e. more expensive bids on their 

clients for existing freight volumes. They 

risked losing tonnage to those carriers 

seeking, ‘at fair market prices’, to maximize 

load factors on their new widebodies. ‘The 

core business of any airline is shipment from 

airport to airport,’ Frei stressed. ‘That’s all 

we expect.’ 

These arguments were reinforced 

by C.K. Lee (Exel), who bemoaned the 

declining status of traditional airfreight: 

‘Terms such as ‘offload’ and ‘standby’ are 

gaining increasing currency in connection 

with general cargo. Airlines honor the letter, 

but not the spirit of freight agreements.’ 

Frei also championed the GF-X 

freight portal: ‘For years, our sector has 

searched for a transparent solution to identify 

the shipping capacities available at a 

given price. With GF-X we have – at last 

– created such a tool. I am amazed it’s not 

‘With Resolution 

502, the airlines 

are trying to 

improve their own 

results without 

creating any added 

value’: Robert Frei 

at ACF 2002. 

airfreight 

found more support. Were we to jeopardize 

the successful development of this first platform, 

a second will be doomed from the start! 

There is no alternative in sight – neither now 

nor in the next few years.’ Frei added that 

fresh measures were in the pipeline to attract 

Asian carriers to GF-X, thus providing 

global coverage. 

*Rolf D. Sulser is a freelance 

aviation journalist based in Basel, 

Switzerland (rolf.sulser@aviatica.ch) 


19

connect 1 | 2003 Mind 

20 

the gap! 

Metro trains flown to China: To ensure that the rolling stock for the 

Guangzhou Metro’s Line No. 2 would reach the city in time for the line’s 

opening, Panalpina had some of the Metro cars flown from Germany to China. 

Panalpina’s <strong>projects</strong> division ASB-PanProjects of 

Hamburg achieved a ‘world first’ last November and 

December when, in cooperation with ASB-Air and 

Antonov Airlines, it had a complete 6-car metro train 

airfreighted from Parchim in Germany to the southern 

Chinese city of Guangzhou within 11 days. The aircraft 

was able to transport two cars at a time, so three flights 

were required altogether. 

Never before has such a shipment been organized. 

The required degree of precision was staggering: 

there were only centimeters to spare between the carriages 

and the aircraft’s sides, while the carriage roofs 

cleared the top of the cargo bay by precisely two centimeters! 

Six hours were needed to load the freighter 

with each pair of cars, which were produced at the 

Bombardier factory in Hennigsdorf. But before loading 

could even begin, a team from ASB-PanProjects and 

ASB-Air, working in close cooperation with Antonov 

Airlines and Bombardier Transportation, developed a 

100%-secure transshipment and forwarding plan covering 

the entire transport chain from the Hennigsdorf 

works through to delivery to the Guangzhou transport 

administration. 

At the end of November, the Metro cars were 

lifted onto purpose-built low-loading auxiliary bogies at 

the Bombardier factory. Meanwhile, experts at the airport 

were assembling special ramps so that the outsize 

loads could be rolled from the tarmac straight into the 

Antonov. ASB-PanProjects had ordered the construction 

of these 23.5 meter long ramps especially for this assignment. 

After the cars had made their way overnight 

from Hennigsdorf to the airfield at Parchim, a journey 

of some 120 km, the moment of truth arrived: with the 

help of two mobile cranes, they were edged, centimeter 

by centimeter, onto the ramps and then hauled into the 

Antonov on special guide-rails by the aircraft‘s own 

winch. The bogies, guide-rails and ramps all made the 

trip to China along with the cars themselves.

Loading the coaches 

with only millimeters 

to spare. 

VIP reception 

On arrival at Guangzhou’s Bayun International 

Airport, the aircraft was met by a high-ranking delegation 

led by Mayor Lin Shusen: neither he nor the officials 

accompanying him were deterred by the heavy 

rain from ‘meeting and greeting’ this first delivery of the 

new Metro trains. 

Backed up by 22 technicians and engineers from 

Antonov Airlines and the local handling company West 

True Dragon Transportation, the project experts from 

Panalpina organized unloading on the German-built 

ramps and transfer onto the waiting 32-metre hydraulic 

suspension low-loaders. Although it was only another 30 

km or so to the final destination, numerous pinch-points 

and low bridges had to be negotiated. Needless to say, 

all had already been inspected by Panalpina’s experts. 

After a journey under police escort lasting some 7 hours, 

the convoy finally reached the transport administration‘s 

depot in Guangzhou. Though no-one could have doubted 


that the operation would be a success, everyone must 

have breathed a sigh of relief. ‘We’re very proud to have 

conducted this complex task to the full satisfaction not 

only of Bombardier but also of the Guangzhou transport 

authority’, said an overjoyed Nick Winderlich, Senior 

Vice President of ASB-PanProjects China. 

Major order from Bombardier 

The six Metro cars delivered to China by Antonov 

AN 124-100 were the first tranche of a major order 

received from the Canadian manufacturer Bombardier. 

The entire project involves the shipment of some 20 000 

freight tons between 2002 and 2004, comprising a total 

of 26 Metro trains plus a large volume of welding and 

assembly equipment. Of the 26 trains, only the first two 

were assembled in Germany: the remaining 24 are being 

delivered in knocked-down form for assembly in the 

Chinese town of Changchun. Some of the assemblies and 

components originate in Europe. 


21


22 

ASB-Air and ASB- 

PanProjects drew 

up a detailed 

consignment plan 

together with 

Antonov Airlines 

and Bombardier 

Transportation. 

The project had been put out for tender by 

the joint venture Changchun Bombardier Railway 

Vehicles Company (CBRC). The project plan presented 

by Panalpina (or, more precisely, ASB-PanProjects) impressed 

the customer, who then entrusted Panalpina 

with all transportation <strong>logistics</strong> from the Hennigsdorf 

factory through to delivery to the end-user. Among 

other things, this assignment includes coordination of 

delivery dates, at-works loading, all transportation and 

packaging tasks, and the shipment of various components 

from a variety of European countries (including 

Italy, the UK and Sweden). ‘Panalpina‘s range of tasks 

is supplemented by the transportation of raw materials 

from China to Germany, including aluminum profiles 

for the construction of the coach bodies’, explains Michael 

Brose of ASB-PanProjects Hamburg. ‘The Chinese 

joint-venture regulations stipulate that certain materials 

have to be produced in China’, he continues. 

The first deliveries, which took place in August 

2002, consisted of flat packs containing ready-sprayed 

elements such as the coach roofs, side panels and floors. 

To prepare these delicate goods for their journey, ASB- 

PanProjects worked together with Repack, a firm that 

has developed a special packaging system that avoids 

multiple handling and thus lessens the risk of damage 

during transshipment. The first consignments then left 

Germany aboard the ‘Altair’, a freight vessel operated 

by the German shipping line Rickmers-Linie.

Panalpina China 

Landing and successfully handling this order would 

have been unthinkable without the help of the 

skilled and experienced Panalpina organization in 

China. Founded in Hong Kong in 1976, Panalpina 

China now has over 20 offices and about 450 

staff. It is headquartered in Hong Kong, and is 

also present in Beijing, Chengdu, Dalian, Guangzhou, 

Haikou, Macao, Nanjing, Ningbo, Qingdao, 

Shanghai, Shekou, Shenzhen, Tianjin, Xiamen and 

Urumqi. 

With its large network of offices, Panalpina China 

covers all strategically important locations in this 

huge country. It also has close ties with Sinotrans 

and EMS (it operates with the latter company in the 

express freight and parcels segment). Panalpina 

offers a full range of services in China, and has 

airfreight and seafreight hubs that are connected 

to its worldwide network. Hong Kong is home to 

the Asia Hub for seafreight groupage freight, while 

Macao boasts a weekly B747 charter flight to Luxembourg. 

In 2001, over 166 000 airfreight consignments 

and more than 120 000 TEUs were handled. 

Panalpina China is also, of course, very active in 

the <strong>logistics</strong> segment: its customers include a large 

number of major companies operating in China in 

the high-tech, automotive and healthcare sectors. 

In Hong Kong, Shanghai and Beijing, moreover, it 

has large and modern <strong>logistics</strong> terminals. In addition, 

it provides a wide range of services for the 

oil & gas industry and handles numerous project 

assignments. And finally, Panalpina China offers 

<strong>logistics</strong> solutions for a number of other sectors, 

including the food and textiles industries. 



23


24 

Bringing the 

strategy to life 

Any strategy, however clearly formulated, is 

hardly worth the paper it is written on unless 

it is understood and consistently implemented 

by company staff. The proclamation of 

strategic objectives at seminars, assemblies 

and press conferences is all well and good. 

Yet the involvement of the employees is much 

more crucial, given that they are the ones ultimately 

responsible for putting strategies into 

practice. But how, in a 12 000-strong company, 

do you reach every single staff member? 

Panalpina CEO Bruno Sidler opted for video 

and CD-ROM as the media through which to 

address the global Panalpina family. 

Prior to shooting the interview, a 

working group consulted with national organizations 

and branches to pinpoint those aspects 

of Panalpina’s strategic orientation requiring 

clarification. The resulting questions 

were then put to Bruno Sidler in the studio by 

Ingrid Bringas from the AMEC Regional Center 

and Glenn Barnes of Panalpina London. 

The outcome was an intensive and revealing 

20-minute discussion in which the CEO personally 

addressed the burning issues. 

Local presentations 

So far, so good – but how do you best 

present such an interview to staff members? 

Do they watch the film alone at their workstation 

or in the privacy of their home? Definitely 

not! Teamwork and a collaborative approach 

to problem-solving are part and parcel of 

Panalpina’s corporate culture and one of the 

keys to its success. The film was screened 

at events held specially for this purpose, and 

in a format freely selected by the country or 

branch in question. 

In-house communication: Panalpina CEO Bruno Sidler 

seeks to enhance client benefit through a video address to 

Panalpina’s workforce. 

Ingrid Bringas 

and Glenn 

Barnes weren’t 

afraid to 

pose tricky 

questions. 

Roadshow in Great Britain 

and Ireland 

The Panalpina management in 

Great Britain and Ireland, for instance, put 

on a ten-day roadshow that included over 

20 screenings at eight venues. ‘We visited 

all the branches in both countries and literally 

gave every single employee a chance to 

see the film,’ Panalpina Managing Director 

Sandro Knecht explains. He was particularly 

gratified by the positive feedback. 

‘Our staff really appreciated the 

first-hand information given on key issues 

such as strategy, standardization and 

operational excellence,’ Knecht adds. ‘We 

managed to hammer home why Panalpina 

has chosen this business model and what 

implications the Group’s global strategy has 

at a local level for individual staff members.’ 

He was pleased that the frank information 

policy had succeeded in dispelling a number 

of fears and uncertainties. ‘At Panalpina, 

the aim of process standardization isn’t 

to slash jobs, but to give employees more 

time to attend to our clients.’ 

Many of the events witnessed by 

Sandro Knecht and Operations Director 

Glenn Barnes revealed a genuine enthusiasm 

among employees for the <strong>logistics</strong> 

business. The presentations triggered lively 

discussions that culminated in stimulating, 

in-depth question-and-answer sessions. 

The key planks of Panalpina’s strategy were 

made clear to all and were widely applauded. 

As Sandro Knecht underlines, ‘I’m convinced 

we have the full backing of our staff in taking 

these crucial steps to secure an even better 

service for our clients.’ 

Picnicking with the CEO! 

‘Bruno Sidler, Ingrid Bringas and 

Glenn Barnes conducted the interview in 

English, and we produced French, German 

and Spanish versions,’ Panalpina’s Internal 

Communications Officer Marcello Corciulo 

explains. ‘But it didn‘t stop there: many 

local organizations, particularly in Asia, 

translated the interview into the official 

language of their country.’ The South Korean 

version, for instance, had Korean 

subtitles. ‘We also handed out a transcript 

of the interview in Korean and English to 

all participants,’ adds Winnie Kang from 

the Public Relations Department. In Korea, 

viewings were not confined to the office; the 

film was also shown as part of a specially 

arranged picnic outing.

Staff hard at work implementing 

the strategy. 

Different language versions 

Panalpina Thailand likewise translated 

the interview into the national language, 

combining its presentation with a 

customer service training program. In India, 

the film was simultaneously screened at all 

branches, where staff members watched in 

small groups. Management representatives 

then answered employees‘ questions after 

the showing. 

Panalpina China even went to the 

trouble of distributing two additional versions 

of the film, in Mandarin and Cantonese, 

to each of its branches. Managing Director 

Stephen Yeung provided further details on 

the local Intranet and urged his employees 

not to skimp with their questions. As Winnie 

Ho, Public Relations Officer in China, 

points out, ‘The film was an excellent way of 

directly communicating between Panalpina 

head office and the Chinese organization 

and was duly welcomed. For our personnel, 

the strategy has now ceased to be an abstract 

piece of correspondence, but some- 

human resources 

thing tangible with direct implications for 

our everyday routine.’ Lilian Tan from 

Panalpina Singapore was equally positive: 

‘Bruno Sidler found clear and simple words 

to describe the objectives the company has 

set itself and how these are to be achieved. 

It was also important for our staff to learn 

about the strategic orientation from the 

CEO in person.’ As Lilian Tan sees it, ‘Our 

employees now know the strategy has the 

full backing of management and that each 

individual is expected to make his or her 

own contribution.’ 


25

connect 1 1 | 2002 2003 

26 

Ready to spring 

into action 

USA: The events of late September and early October 2002 

testified once again to the speed, reliability and innovation of 

Panalpina in helping out its clients in a crisis. A labor dispute 

between port operators and dockworkers prompted a shutdown 

of the 29 US West Coast ports between San Diego 

and Seattle, which account for imports and exports worth 

some USD 300 bn a year. With over 200 ships forced to drop 

anchor outside the docks, suppliers were left sitting on their 

goods while deliveries to processing plants and retailers were 

suspended – all this bang on time for the start of Christmas 

trading! 

There was only one solution to the dilemma: an airlift! Backed 

by its sophisticated capacity management system and its 

top-performing Charter Division, Panalpina, in collaboration 

with in-house carrier ASB Air, managed to maintain supply 

chains between Asia and North America for a large number 

of its clients. In all, Panalpina arranged 21 unscheduled 

flights by B747 freighter along the Macao – Los Angeles, 

Macao – Chicago, Macao – Huntsville and Cebu – Huntsville 

routes. 

Australia: Panalpina’s Detroit-based automotive-sector 

client American Axle & Manufacturing (AAM) was another 

company hit by the blockade. Closure of the ports left some 

50 containers stranded at sea. These contained goods from 

Australian supplier PBR Automotive bound for the AAM 

plants at Detroit MI and Tonawanda NY. Working in tandem 

with ASB Air, Panalpina Detroit drew up an emergency plan 

that involved chartering two Antonov AN 124-100 planes to 

airlift the goods to Hamilton Ontario with onward shipment to 

the plants. Panalpina Melbourne immediately liaised with the 

consignor to arrange collection at two different sites, interim 

storage, loading onto the planes and customs clearance. 

The Melbourne staff remained in close contact with their 

Detroit and Toronto counterparts throughout. The products 

were stowed on board according to a priority list drawn up 

by the consignee. Each Antonov carried a total of 233 crates 

weighing 104 617 kg, with 91 bound for Tonawanda and 142 

for Detroit. Panalpina‘s triumphant achievement is a clear 

illustration of how the speed and efficiency of a forwarding 

operation can be maximized through the concerted efforts of 

all involved. 

ASB-Air organized 

21 additional flights 

with B747 freighters. 

Panalpina chartered 

two Antonov AN 

124-100s to supply 

its client AAM 

with goods from 

Australia.

Panalpina acquires 

a stake in Luxair 

Racing boats in action at the 

Formula 2000 World Championship 

in Qatar. Panalpina transported 

the boats from Europe to 

the Middle East. 

Basel/Luxembourg: Panalpina acquired 12.1% of the 

share capital of the Luxembourg airline Luxair at the end of 

November 2002. Since January this year, Panalpina CEO 

Bruno Sidler has had a seat on Luxair’s Board of Directors. 

Panalpina is a major customer both of Luxair and of its subsidiary 

Cargolux. By acquiring a strategic interest in Luxair, 

the latter has consolidated its strong position in the area of 

freight handling – one of the Group’s core competencies. Panalpina 

regards the equity stake as a key element in its drive 

to optimize its Luxembourg airfreight hub and in the development 

of the two companies’ joint activities. Luxair (Société 

Luxembourgeoise de Navigation Aérienne), was founded in 

1962 and now flies to some 50 European destinations. With 

an annual freight capacity of some 750 000 tonnes, Luxembourg 

airport is a significant platform for airfreight 

worldwide 

VIP treatment for 

power boats 

Qatar: Panalpina has organized international transport for 

about 20 power boats taking part in the Formula 2000 World 

Championship in Qatar and Great Britain. Having starred in the 

successful British Power Boat Grand Prix at the Royal Victoria 

Docks in London, the boats – each weighing some 1500 kg 

– were loaded into containers and prepared for their voyage to 

the Middle East. Specialists from the Middle East Department 

at Panalpina London supervised transhipment into 40-foot 

containers and ensured that the consignment was safely 

stowed. As soon as the ‘Al Noof’, a container vessel belonging 

to the United Arab Shipping Company (UASC), had docked 

at its destination, Panalpina Qatar – which was a sponsor 

and official carrier for the Qatari racing teams – received the 

precious consignment and delivered it punctually to the race 

venue at Doha. After the races, Panalpina also handled the 

transportation of Formula 2000 racing boats back to Valencia, 

Göthenburg and Como. 


27

Photo: gettyimage 

connect 1 1 | 2003 2002 

28 

Beaujolais Nouveau: This year, 

Panalpina shipped 890 tonnes 

of the young French wine to 

Japan, 50 tonnes to Korea and 

1160 tonnes to the US. 

6 000 miles at 5°C 

Switzerland/Japan: Panalpina Switzerland recently handled a challenging 

shipment using a new product launched by the Swedish company 

Envirotainer. The innovative freight container is able to maintain a constant 

temperature for 84 hours no matter how often the goods are transshipped. 

The cargo comprised small quantities of an exceedingly sensitive 

and very expensive pharmaceutical product urgently needed for a patient 

in Osaka. In the words of Pietro Albertalli, branch manager at Panalpina 

Lugano, ‘It was absolutely crucial that the medicine arrived in Japan as 

fast as possible and in sound condition.’ A constant temperature of 5°C 

was successfully maintained throughout the 6 000-mile journey between 

Lugano and Osaka – despite constant fluctuations in external temperatures 

and air pressures as the container was shifted between truck, rail 

and plane. 

Envirotainer developed the CLD (controlled <strong>logistics</strong> device) specifically 

for pharmaceutical items such as medicines, vaccines and blood samples 

that require shipment in small, even minute quantities at constant temperatures. 

As Bernhard Metzger, Envirotainer’s Executive Vice President 

for Marketing, Sales and Partnerships, explains, ‘Refrigerated airfreight 

consignments have always relied on passive cooling systems using insulation 

and cool packs. Envirotainer, however, recognized the need for an 

active system to guarantee an unbroken cooling chain between consignor 

and consignee. This is what we have achieved with the new CLD.’ 

The race to deliver the 

Beaujolais Nouveau 

France: Each November, 

Panalpina Lyon is at the focus of 

worldwide airfreight activities as the 

famous French wine is rushed out 

to connoisseurs. 

The moment countless wine 

fans around the world wait for is 

midnight on the second Thursday 

of November. At the stroke of 

twelve, the race for the Beaujolais 

Nouveau begins. Last year, over 

65 million bottles left the vineyards 

in southern Burgundy to find their 

way by the quickest route to lovers 

of this world-famous young red 

wine. 

The <strong>logistics</strong> involved in shipping 

hundreds of thousands of bottles 

out of the Beaujolais 

region calls for careful 

planning and huge 

amounts of airfreight 

capacity. 

Last year’s vintage 

of over 2100 tonnes 

made the 2002 race 

a record one for 

Panalpina. In addition 

to using scheduled 

air services, Panalpina Lyon – in 

conjunction with the Charter de- 

partment of ASB-Air – chartered 

nine flights purely for the transportation 

of 890 tonnes of Beaujolais 

Nouveau to Japan. Three took off 

from the European airfreight hub 

in Luxembourg while another four 

departed from Lyon and one each 

from Amsterdam and Liège. 

In addition, Panalpina transported 

50 tonnes to Korea and 

1160 tonnes to the US. 

Working closely together with 

Group companies overseas, 

specialists at Panalpina Lyon 

organized and executed the shipments 

with painstaking care. The 

principal destinations were Tokyo, 

Sapporo and Osaka, all of which 

were reached by direct flights from 

Europe. Additional consignments 

went to Fukuoka, Okinawa and Nagoya. 

Panalpina Japan coordinated 

on-forwarding of the shipments to 

numerous distribution centers all 

over Japan. Consignments bound 

for New Orleans went via Huntsville 

(Alabama) on ASB-Air’s Dixie-Jet 

service. At precisely 2.30 p.m. on 

17 November, the last consignments 

reached their final destinations 

– safe and sound as always.

Panalpina backs polar 

expedition 

Panalpina Germany played a supporting role in an expedition to the 

geographical North Pole organized by Dr. Victor Boyarsky, the celebrated 

polar explorer and Director of the Russian State Museum of Arctic and 

Antarctic in St Petersburg. The ten team members came from Japan, 

China, Sweden, Australia, USA, Switzerland, Austria, Germany and Russia. 

A journey to the North Pole is an arduous undertaking that requires a 

great deal of patience as well as a thirst for adventure. From St Petersburg 

the group took a scheduled flight to Moscow where they joined a 

chartered Antonov cargo plane for the onward flight over the Urals, via 

Norilsk, to the Russian mining town of Khatanga. Here, the team boarded 

another freighter (this time with unpressurized cabin and no heating) for 

the next leg via Sredni Island to Borneo, a temporary Russian ice station. 

The group was then taken by helicopter to the actual starting point on 

the 88th parallel. Temperatures during the 240 km trek (as the crow flies) 

periodically dipped below the -50°C mark. Classed as an arid desert, the 

North Pole experiences a similar amount of precipitation as a subtropical 

desert. The icecap chiefly comprises frozen seawater and windblown particles 

of snow and ice. At this time of the year, the North Pole has daylight 

round the clock, with the sun circling the pole at an angle of 30° to the 

horizon. The polar region is not terra firma, but a layer of ice (2.5 meters 

thick on average) permanently subject to drift. Owing to this movement, 

the distance covered in the daytime was on one occasion lost during the 

‘night’. Due to the extreme temperatures, some expedition members suf- 

Lufthansa Awards go to 

Panalpina Vietnam and Thailand 

Vietnam/Thailand: Panalpina Vietnam 

was presented with the ‘Golden Award 2002’ 

by its airfreight partner Lufthansa Cargo. By 

awarding this prize, the carrier has expressed 

its appreciation of its close cooperation with 

Panalpina Vietnam and of its partner’s reliability 

in confirming bookings and using the freight 

capacity it reserves. This attests to Panalpina 

Vietnam’s ability to plan ahead efficiently and 

make capacity available to its customers at 

all times. Panalpina is now Lufthansa’s best 

customer in Vietnam in terms of both tonnage 

and sales. 

Panalpina Thailand bags 2002 Splendor 

Award and Touchstone Award 

Panalpina Thailand was doubly honored by 

Lufthansa Cargo, scooping both the 2002 

Splendor Award for exceptional services and 

the 2002 Touchstone Award for outstanding 

quality. Regional CEO Lars-Ola Gunnarsson 

viewed the two prizes as a tribute to Panalpina 

Thailand’s endeavors in providing its clients with 

best-in-class services and products. 

worldwide 

fered frostbite on hands, fingers and in the face. Nonetheless, there was 

just cause for celebration when the destination was finally reached. Much 

to everyone’s joy, the temperature on this day was a ‘mild’ -30°C with 

practically no wind and a clear azure sky overhead. 

Panalpina 

extends cooperation 

with Delphi 

Delphi Corporation, one of the world’s leading 

manufacturers of car components, has entrusted 

Panalpina with its intercontinental air and seafreight 

shipments, including warehouse handling and 

brokerage, for a further three years. The agreement 

covers shipments to and from North America and 

Europe, between North and South America and 

between Europe and South America. In addition, 

Panalpina has been awarded a number of new 

routes between Asia and South America. 

The products handled comprise automotive 

components transported from Delphi’s suppliers to 

factories and assembly shops around the world. 

In some cases, Panalpina also delivers direct from 

the Delphi factories to the end users. 

The total number of consignments shipped by 

Panalpina has risen to over 60 000 per annum. 

With the additional routes to Asia, Panalpina now 

handles shipments for Delphi Corporation between 

more than 300 stations in 30 countries. In addition, 

Panalpina has been entrusted with customs 

clearance in the USA. At Delphi’s Automotive 

Logistics Center in Detroit (Michigan), Panalpina is 

also responsible for <strong>logistics</strong> services and quality 

control as well as for inventory management and 

for repacking goods in reusable containers. 


29


30 

Panalpina moves into 

CargoCity Süd 

Germany: On a site covering some 34 000 square meters at Frankfurt 

Airport‘s Cargo City Süd, Panalpina will operate a new 14 000 m 2 freight 

handling centre plus offices occupying a further 2 000 or so square meters . 

The Group plans in future to send the majority of airfreight passing into and 

out of Germany through Frankfurt. Some of the freight it handles for other 

European countries will also pass through the new hub. The new site means 

that Frankfurt is joining Luxembourg and Paris as one of Panalpina’s three 

western European airfreight hubs. The ultra-modern freight hub is due to be 

completed in summer 2003. 

The construction project is in the hands of the Hamburger Garbe Group, 

which has already invested in <strong>logistics</strong> centres at various European locations. 

ABB Meeting 

in Paris 

Front row, from left to right: Claudia Colet, Panalpina Milan; Lialian 

Nagaoka, ABB Brazil; Stefanie Mosnier, ABB France; Marina Herrero, 

Panalpina Mexico; Kerstin Hellbom, Panalpina Sweden; Veronique 

Triboulet, Panalpina France; Hans Peter Frey, Panalpina Germany; 

Giovani Gaetani, ABB Italy 

Back row, from left to right: Roland Selen, ABB Sweden; Gert Thamm, 

ABB Key Account Manager; Jean Marc Poret, Panalpina France; Kai 

Koivula, Panalpina Finland; Mats Widlund, Panalpina Sweden; Gilberto 

Zanon, Panalpina Brazil; Paolo Meroni, ABB Italy 

Key Accounts: The customer’s individual requirements 

are always the main focus of Panalpina‘s activities. Even the 

most sophisticated <strong>logistics</strong> solutions are of no use if they 

fail to match the customer‘s needs. We thus do our utmost 

to understand the customer and his business, to identify his 

requirements in person-to-person discussions, and to jointly 

seek the best solutions. In this way Panalpina ensures that 

concepts like ‘operational excellence’ and ‘total customer 

satisfaction’ are binding principles that lead us to concrete 

targets, and not just empty buzzwords. 

The ABB Key Account Management team’s recent meeting 

in Paris with the client’s representatives is a good example of 

this. The aim was firstly to analyze and adapt various aspects 

of the cooperation, and secondly to identify new potential 

areas for cooperation. The meeting was hosted by ABB Key 

Account Manager Gert Thamm, who was able to welcome 

the ABB representatives from Brazil, Mexico, Finland, France, 

Germany, Italy and Sweden. 

Young Freight 

Forwarder of the Year 

Gary Archer, Operations Manager 

at Panalpina Aberdeen, has been 

named ‘UK Young Freight Forwarder 

of the Year 2003’, having 

received the annual award of the 

British International Freight Association 

(BIFA). 

23-year-old Gary Archer joined 

Panalpina in 1998 and was soon 

entrusted with full operational 

responsibility for one of Panalpina’s 

top customers in the oil and gas 

industry. Since then, he has been 

able to gather wide experience of 

global <strong>logistics</strong> services for this 

customer segment – not least of all 

by working at a number of major oil 

and gas production sites. In 2001 

he transferred to Aberdeen, the 

heart of the European oil industry. 

‘Panalpina recognized my potential 

early on and gave me challenges 

that motivated me to proactively 

develop my professional skills’, 

says Archer. ‘I was soon given 

management responsibility and 

am now in charge of a major UK 

branch. I’m absolutely delighted to 

have received this award.’ 

Sandro Knecht, Managing Director 

of Panalpina UK/Ireland, stressed 

that ‘this prestigious award attests 

to Gary’s fantastic work and 

reflects the professional approach 

he has shown to his work for Panalpina 

in the last few years. Our 

fast-moving sector needs young 

and talented people like Gary 

Archer. Structured career plans like 

those we have implemented with 

Gary are decisive in ensuring that 

our customers receive top-quality 

forwarding and <strong>logistics</strong> services.’ 

In September, Gary Archer will be 

going to Bali as the UK’s official 

representative at the International 

Young Freight Forwarder of the 

Year Award 2003.

Humanitarian aid 

for Uzbekistan 

Panalpina has demonstrated its flexibility, reliability and professional knowhow 

in actively assisting with a project of the U.S. Department of State. 

Once again, Panalpina showed what it can achieve by efficiently coordinating 

the activities of its various national organizations. In this instance, 

Panalpina Washington, ASB-Air in Luxembourg and Panalpina Uzbekistan 

worked hand in hand to ensure that the challenging project was a complete 

success. The shipments consisted of drugs and medical supplies worth 

USD 60 m donated to Uzbekistan by the USA. The State Department was 

so impressed by Panalpina’s services that it awarded a ‘Certificate of Appreciation 

for outstanding effort’ to Ken Jones of Panalpina Washington. As 

Ken stresses, ‘Although the certificate carries my name, this great honor 

obviously goes to all those colleagues at Panalpina and ASB-Air who were 

involved in these shipments’. 

Aid for 

Kyrgyzstan 

Also on behalf of the U.S. State Department, Panalpina organized 

the transportation of a major consignment from the USA to 

Kyrgyzstan, utilizing the weekly B747 freighter service operated 

by ASB-Air. On arrival of the aircraft in the Kyrgyz capital Bishkek, 

the team was received by a delegation led by Kyrgyzstan’s ‘First 

Lady’. Also present were the Kyrgyz health minister and foreign 

minister plus representatives of the relief organizations involved 

and of the U.S. State Department. The shipment was part of an 

aid package for the treatment of children and cancer patients in 

Kyrgyzstan. 

Panalpina Singapore 

celebrates silver jubilee 

Singapore: At the 

end of October, some 

100 guests were invited 

to Hotel Fullerton Singapore 

to help Panalpina 

celebrate the 25th anniversary 

of its presence 

in Singapore: Both 

Managing Director Volker 

Sachse and Lars-Ola 

Gunnarsson, Regional 

CEO of the Asia-Pacific Region, were full of praise 

for the staff: both speakers emphasized the employees’ 

commitment, motivation and resourcefulness 

underpinning the Singapore organization’s success. 

Gunnarsson also thanked the customer representatives 

who, ‘with their initiative and far-sightedness, 

present Panalpina with a steady stream of fresh 

challenges’. He stressed that ‘a strong organization, 

competent staff and demanding customers are the 

recipe for a dynamic partnership.’ The celebration 

culminated in the Swiss Ambassador to Singapore, 

Dr. Daniel Woker, striking up a chorus of ‘Happy 

Birthday’ for Panalpina, and everyone present was 

delighted to join in. 

Founded in 1977, the Panalpina Organization in 

Singapore now has a workforce of 230. It offers the 

Group‘s full range of services, including comprehensive 

<strong>logistics</strong> solutions. Singapore is a major 

platform for the Panalpina Group’s <strong>logistics</strong> services 

in southeast Asia. Since 1996 it has operated the 

Harbour Link Distribution Centre – a large, state-ofthe-art 

<strong>logistics</strong> centre covering some 43 000 square 

meters. 

Qualcomm Partnership Award 2002 for 

Panalpina Singapore 

A major honor has been bestowed upon Panalpina 

Singapore: it was chosen by the high tech company 

Qualcomm CDMA Technologies Asia Pacific as winner 

of the Qualcomm Partnership Award for 2002. 

It conferred the award in recognition of Panalpina’s 

outstanding performance in terms of damage-free 

delivery, flawless documentation, reliability and 

punctuality. Panalpina Singapore’s outstanding quality 

and its relentless quest for operating excellence 

have thus once again received recognition. 

worldwide 

Panalpina Day 

in Miami 

USA: June 28, 

2002 was proclaimed 

‘Panalpina Day’ in 

Miami-Dade County. 

Alex Penelas, Mayor of 

Miami-Dade County, 

took this opportunity 

to praise Panalpina 

for its global successes in general and for the 

development of its business in the Miami region 

in particular. On awarding the certificate, Mayor 

Penelas highlighted the innovative drive and 

dynamism that has made Panalpina one of the 

world‘s leading <strong>logistics</strong> companies, whose 

presence in Miami has contributed to the region’s 

prosperity and quality of life. 

Panalpina 

ice hockey triumph 

Standing (l. to r.): Peter Baumgartner, Horst von Kanel, 

Boris Waldis, Hans Aeschbacher, Miguel Seco, Rolf 

Krattiger, Nick Kroebl, Philippe Queloz, Tobias Lüdin, 

Cyrill Gaechter. Kneeling (l. to r.): Chris Engeler, Jürg 

Koch, André Kaiser, Walter Isler, Christian Renz. 

Right: A victory sign for the sole female member of 

the team, Sandra Marti. 

Switzerland: 8:4 was the final 

scoreline of a fun match between 

the ice hockey teams of Panalpina/ 

ASB Air and Danzas/DHL played 

in Basel! Watched by Panalpina 

CEO Bruno Sidler, the team led by 

the player-manager duo Philippe 

Queloz and Cyrill Gaechter displayed 

supreme skill and fighting 

spirit in coming from behind to see 

off Danzas/DHL by an impressive 

four-goal margin. Walter Isler netted 

the puck three times to become top 

scorer, with Sandra Marti, Rolf Krattiger, 

Jürg Koch and Cyrill Gaechter 

adding to Panalpina‘s tally. Despite 

the tireless commitment of both 

teams, fair play was the motto of 

the day and, muscle strain aside, all 

emerged unscathed. 


31

Communicative 

and versatile 

Part of my job is to coordinate the work of my team 

and to make sure that the LCL shipments from 

Hong Kong to Germany are handled smoothly. I like 

my job, because it is both varied and challenging. 

On the one hand, I deal with the handling of the 

consolidated cargo, while on the other hand I get 

to communicate a lot with customers, partners and 

other Panalpina organizations overseas. I greatly 

enjoy the contact with people from other countries. 

I have been working for Panalpina for about 

10 years and like it as much as ever. If you 

feel comfortable with a company, you enjoy 

your work and therefore also carry it out 

more efficiently. In our team everybody is 

motivated and gives his all. 

Integrated solutions for your supply chain 

Tammy Wong 

Supervisor LCL-Team 

Panalpina Hong Kong

Gargantuan logistics projects on Sakhalin Island

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