Logistics Management - October 2011

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Get your daily fix of industry news on logisticsmgmt.comcontinuedm Wanted: National airline policy. The AirTransport Association of America, Inc. (ATA),the industry trade organization for the leadingU.S. airlines, was calling on the FederalAviation Administration (FAA) last month toaccelerate its timetable for implementing newand more efficient air traffic procedures, akey pillar of a needed National Airline Policy.“Near-term FAA action will help governmentfocus on priorities that can provide immediateeconomic and customer service benefits,” saidATA President and CEO Nicholas E. Calio in aspeech at the Boyd Group International AviationForecast Summit. As a first step towardexecuting a National Airline Policy, the ATAcalled on the Obama Administration andthe FAA to focus its resources on expeditingthe most cost-beneficial elements, includingperformance-based procedures.m UPS beefs up European hub. UPS is makingmajor expansions to its European air hubfacilities at Cologne/Bonn Airport in Germany.Company officials said that the roughly$200 million expansion, which is expected tobe completed by the end of 2013, will consistof equipping the existing facility with additionalstate-of-the-art technology as well asan extension to the existing building. Thegoal is to allow the building to process largerfreight shipments. UPS added that theseefforts will boost the carrier’s package sortingcapacity from the current level of 110,000packages per hour to 190,000 packages perhour. UPS has roughly 2,300 employees at theCologne/Bonn Airport, and the company saidthis expansion should add up to 200 jobs bythe end of 2013.m Massport cleans up. In keeping with anational trend, The Massachusetts Port Authority(Massport) began developing its own “CleanTrucks Program.” Last month’s announcementincluded news that the Environmental ProtectionAgency (EPA) had “teamed up” with theport to establish a program giving ownersof older trucks servicing Conley ContainerTerminal an incentive to replace the vehicleswith ones that are 2007 emission compliant ornewer. With a $500,000 EPA Diesel EmissionsReduction Act, a total of $1.5 million will beavailable to provide truck owners with 50 percentof the replacement cost. Massport ExecutiveDirector Mike Leone said unionization ofdrivers was not a mandate for this program.“This program regulates trucks not truckers,”said Leone.m Better, but not great says IATA.The InternationalAir Transport Association (IATA)announced an upgrading of its industry profitexpectations to $6.9 billion—up from $4.0billion projected in June. IATA emphasizedthat, despite the improvements, profitabilityat these levels is still exceptionally weak (1.2percent net margin) considering the industry’stotal revenues of $594 billion. In its firstlook at 2012, IATA is projecting profits to fallto $4.9 billion on revenues of $632 billion fora net margin of just 0.8 percent. “Airlines aregoing to make a little more money in 2011than we thought. Given the strong headwindsof high oil prices and economic uncertainty,remaining in the black is a great achievement,”said Tony Tyler, IATA’s director generaland CEO. “But we should keep the improvementin perspective. The $2.9 billion bottomline improvement is equal to about a half apercent of revenue, and the margin is a paltry1.2 percent,” he added.m Manufacturers look to the clouds. Theemergence of cloud computing is having adirect and positive impact on manufacturers’IT performance and subsequently supplychain operations, according to a report fromIDC Manufacturing Insights. In its reportBusiness Strategy: Cloud Computing in Manufacturing,IDC stresses how “cloud computingwill have a very positive impact on ITperformance for those firms that take a wellconsidered approach to investment.” Two ofthe report’s notable findings include how 44.3percent of the nearly 100 manufacturers surveyedare either implementing or currentlyevaluating cloud deployments, and more than22 percent have already implemented cloudcomputing systems.October 2011 | WWW.LOGISTICSMGMT.COM Logistics Management 3
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