Cargo operations: ULD management Life after CHEP

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Newly rebranded as Unilode, the world’s largest ULD management company has made a strong start to life as an independent

The world’s largest provider of outsourced unit load device (ULD) management and repair solutions, Unilode Aviation Solutions, has made a strong start to life as an independent.

Just a few weeks after its rebranding this year as Unilode due to the sale of the former CHEP Aerospace Solutions last November to Swedish private equity fund EQT Infrastructure, the company celebrated winning one of the largest ULD management contracts in the industry following a joint tender from Saudia and Saudia Cargo.

The deal, which became operational on 1 April, sees Saudia and Saudia Cargo choosing Unilode’s ‘Hybrid ULD Management’ solution in which Saudia’s containers remain part of a dedicated fleet and its pallets are supplied from Unilode’s pool, increasing Unilode’s overall managed fleet of ULDs by around 20% to 120,000 units.

Unilode president and CEO Ludwig Bertsch says such a major ULD management agreement “is a great sign of our business continuity”. And it also demonstrates that the company’s ambitions are undimmed by its sale by CHEP’s Australian owner Brambles.

But then Bertsch and his company are no strangers to being bought and sold. Indeed, Bertsch was part owner of the holding company Aviation Services Holdings that sold what was then ‘Unitpool’ to Brambles in 2010. And the company had originally developed its ULD pooling concept under the brand Globepool within the SAirGroup, for members of the now defunct Qualiflyer Alliance, until the demise of Swissair in 2002 when it was renamed Unitpool and had a brief period as an independent. It was acquired the following year by handler Swissport , a relationship lasting four years, until Swissport sold the majority of its shares in Unitpool to Aviation Services Holdings, the holding company created by former Swissport executive Bertsch, and Afinum, a German private equity house.

Bertsch told CAAS that since the company’s rebranding from CHEP Aerospace Solutions to Unilode Aviation Solutions in February there had been “many activities and projects being carried out in relation to the acquisition”. Among these has been the creation of the company’s own “back office function”, with reorganised and established IT and finance systems.

Alongside the substantial financial investment led by EQT, Bertsch notes that Unilode has also received investment from another infrastructural backer. He is confident that they are both “long-term” investments and they will work together on a five- and ten-year vision for the company.

Meanwhile, a major tenet of the current plan is to increase the fleet of ULDs that Unilode manages, and Bertsch is confident that Unilode can increase its revenue by 50% in the next five years. The Saudia contract increases the number of ULDs that Unilode manages to 120,000, which is more than double the level at the time of the company’s acquisition by Brambles seven years ago, but this is still only around 12% of the total global market of around 1 million. And with 80% of global ULDs still managed in-house by airlines, there is still a large part of the ULD market waiting to be outsourced, a trend that looks set to continue.

CAAS also talked to Bertsch about the current state of the ULD market:

What have been the most important developments in the cargo ULD market in the last 12-18 months?

“We continue to see emphasis from the manufacturers on reduction of weight using new composite materials. While ten years ago the average weight of an LD3 container was around 80 kg, five years ago around 65 kg, in the last two years we have seen further reductions to under 55 kg.

“We are aware of efforts to bring the weight of the LD3 container below 50 kg. As always though, there will be a payoff between weight reduction and potentially shorter life span − and/or increased repair costs. There are also developments to reduce the weight and increase the rigidity of pallets, which would take further weight off the aircraft.

“There are many developments in the area of safety and technology, with growing interest in fire-resistant containers and smart ULDs. Over the last two years, we have improved our award-winning ‘CanTrack’ device, which is a GPRS tracking solution for containers. We now have the third generation of this technology and, after a number of field trials, we will go live with one of our customers using a fleet of 1,500 containers to see how it works in real life.”

Have there been any significant new technologies, materials, process improvements, or legislative changes recently in the cargo ULD market?

“We remain very interested in the development of collapsible containers as that will always be an opportunity to reduce ULD imbalances around the world, and we continue to work with the OEMs for a feasible useable certified design.

“There has also been increased focus by the regulatory authorities on both the age and condition of cargo restraint nets in use. We see increased awareness from our customers of the importance of this vital equipment and we continue to work with the OEMs to establish easier methodology to enable the user to identify nets that, for example, are approaching their expiry date, as per ULD regulations.

“Without doubt IATA, ULD CARE, and other organisations have contributed to the increased focus on the ULD and its use, highlighting many of the handling practices that need improvement. Training programmes are being offered and good working relationships have been established with many user groups, such as the FIATA Air Freight Institute.”

Do you think the introduction of IATA’s ULD Regulations (ULDR) manual (since 2013) has done anything to improve the standards of ULD handling across the ULD handling chain?

“The regulation addresses important areas such as handling and messaging which greatly impact the serviceability and visibility of the ULDs in the supply chain. It has certainly been very helpful and is a crucial document for the user as it has been simplified and is easier to follow than previous documents.

“It has, with all the other initiatives, increased awareness, but there are still too many examples of poor handling and lack of correct storage for ULD equipment at many airports globally. There are handlers with exceptional equipment, systems, processes and people, while others are in urgent need of improvement. Extensive awareness programmes and training for the whole ULD handling chain continue to be necessary, as the manual in itself will not improve the standards of ULD handling.”

Do you welcome IATA’s more recent damage-prevention campaign, and do you think it is having or will have any significant effect?

“Any damage prevention campaign is to be applauded and encouraged. The ULD handling culture throughout the world does need to improve, and this will only happen with continued focus such as the recent campaign.

“Unilode staff at airports make lots of efforts in promoting safe handling practices among the ground handler community and our containers carry a ‘Handle with Care’ label to call the handlers’ attention that a ULD is an aircraft part and incorrect loading and handling could put the safety of passengers, crew and aircraft at risk.”

Do you plan to make any significant changes to your products and services in 2017?

“From the ULD angle, we continue our efforts to ensure that our containers and pallets are economical and repair hours are reduced so that the total cost of ownership remains reasonable and we have good availability of equipment throughout our network.

“We will continue to focus on our core services of ULD management and ULD and galley cart maintenance and repair solutions. Our customer base is growing as we now provide ULD management to 40 airlines and repair services to around 50 customers. We have recently opened an FAA-approved repair station in Santiago de Chile and will add further service centres in South America and the Middle East.

“2017 is an important year in our company’s history and we will make sure that the positive changes we see following the acquisition by EQT will be passed on to our customers and people − and our position as the world’s leading provider for outsourced ULD and galley cart solutions will be consolidated.”


A flexible soultion

New-generation collapsible containers using lightweight materials such as Graphene could help solve the growing challenge of container repositioning, writes Tom Willis

The idea of collapsible containers first rose to prominence ten to fifteen years ago when fuel prices increased and shippers and airlines explored various possible solutions to rising costs, but when fuel prices subsequently dropped, the idea also dropped out of fashion.

However, it could be making a comeback, according to some in the air cargo industry. The exponential growth of e-commerce and the logistical problems that this brings to air freight operations − shipments that cannot easily be palletized and need to be shipped in containers, combined with strong directional imbalances and sharp seasonal peaks – will require a long-term solution for the container imbalances this creates and the need to reposition them more efficiently and cost-effectively than is currently possible, argues Pieter van Calcar, director and general manager for Asia Pacific at ACL Airshop. ‘Themed’ event days such Valentine’s Day, Singles’ Day and Black Friday further add to the container repositioning challenges.

The solution, he believes, is containers that can be collapsed flat until they are only around 10cm high and stacked into units of six that fit into the low er deck of a wide-body aircraft.

Although there are some collapsible containers already currently used in the market, these tend to be for specific solutions, such as horse stalls. ACL Airshop has also developed collapsible products to transport automobile frames, but these are also not widely used or accessible. Van Calcar says ACL Airshop plans to create a family of collapsible containers, starting with main-deck containers. Development has started, a prototype should be created soon, and the company hopes to finalise a timeline of development before the end of this year.

Graphene revolution

Meanwhile, AV Dome is also working to develop a “revolutionary” new-generation collapsible container using the material Graphene.  The company says its collapsible Graphene ULD products will be lightweight, strong, and flexible, also coming with an “electronic data recorder.” AV Dome is still awaiting the certification required for production as the patents on the containers are still pending.

Ludwig Bertsch, CEO of Unilode, says his company has a small quantity of collapsible containers among its managed pool of containers, but they have remained unused for the best part of two decades because they are too heavy and therefore too expensive to fly around the world. But he agrees that the growth of e-commerce has added to container imbalances and hence the challenge of managing fleets of ULDs. Bertsch warmly welcomes the potential development of a viable collapsible container, but notes that it would need to pass certification and be something that employees on the ramp would be comfortable handling – and robust enough to survive the rough treatment ULDs are currently subjected to.