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June 09, 2014

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INTERNATIONAL MARITIME 30 THE JOURNAL OF COMMERCE www.joc.com JUNE 9.2014 Business continuity plans cannot be standalone, sequential or linear, Seah said, because providing logistics services requires a network solution. "The contingencies and alternatives should cover every available mode and transport option to keep the sup- ply chain moving," he said. Based on experience, Bangkok's old Don Muang International Airport, U-Tapao International in eastern Thailand and Chiang Mai International airport in the north were all possible alternatives should Suvarnab- humi be unavailable, said Alwyn Mendonca, managing director of logistics provider Gulf Agency Co. (Thailand). "Other airports in Thailand will be an option, but their viability depends on their capacity and the flexibility of each airline to suddenly shift service," he said. "Perishable cargo will be most affected by any national airport disruption." For Mathias Madritsch, regional director for sales management, marketing and com- munications at French logistics provider SDV, keeping the freight moving was simple: "We have done it before when the airport was closed before the last coup," he said. "We trucked cargo to the nearest open airport." Morten Damgaard, Agility's CEO for Southeast Asia, said key verticals served and requiring air cargo include high-tech, retail, chemicals, automotive and perish- ables, and if Bangkok airport were closed, there were options to keep customers' sup- plies coming in. "This includes road freight service to Malaysia or Singapore and then air freight on to final destination, or to use combined sea-air freight via Singapore," he told the JOC. Kerry Logistics also is keeping its options open. "If ever the Bangkok airport is shut off, we can divert cargo to other nearby airports at Don Muang, Chiang Mai, Had Yai or Phuket," a spokesman for the Hong Kong-based 3PL said. Global logistics providers routinely build business contingency planning into their supply chains, but no matter how effi- cient or innovative those plans may be, the closure of Bangkok airport would cause mas- sive disruption. Suvarnabhumi Interna- tional is the world's 20th-busiest cargo airport, with 2013 throughput of 1.2 million tons. In the first four months of this year, the airport handled more than 400,000 tons of cargo, and a significant amount of that was perishables and time-sensitive shipments. By way of comparison, Singapore Changi Airport, Southeast Asia's busiest hub, reported throughput of nearly 1.9 million tons in 2013. The greatest impact on logistics com- panies from the coup so far seems to be traffic; the 11 p.m.-to-5 a.m. curfew has worsened Bangkok's legendary gridlock. Desmond Chan, managing director of Menlo Worldwide South Asia, said some domestic deliveries to customer stores were being delayed and have had to be rescheduled. Logistics companies appear to be tak- ing the latest Thailand crisis in stride, but if an Asia-Pacific risk consultant's dire warn- ings are correct, it won't be business as usual for much longer. "Those businesses heavily reliant on air freight or on key dis- tribution or just-in-time manufacturing should make contingency plans now in the event of disruption to air and road trans- portation," Steve Vickers Associates said in a report. "This situation will rapidly evolve," it said. "Previous assumptions that military coups will not affect foreign businesses or interests operating in Thailand may not apply to this situation." JOC Contact Greg Knowler at gknowler@joc.com and follow him on Twitter: @greg_knowler. "Perishable cargo will be most affected by any national airport disruption."

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