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Breakbulk April 2018

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20 The Journal of Commerce | April 2018 Breakbulk & Project Cargo tarian cargoes, so the company flies into Cologne and Frankfurt-Hahn instead. Antonov lands at London Heathrow only to deliver engines for British Airways. Antonov has no immediate plans for fleet replacement, but is updat- ing its existing fleet, most of which was built in the 1980s and updated in the early 1990s. "All our planes are being modernized ... and could go on until the mid-2040s," Bingley said. The company is working with Ukrainian and Western suppliers, including Honeywell, Pratt & Whit- ney, Dowty Propellers, and Zodiac Aerospace. The production life of the rival 747 was extended in February when UPS placed an order for 14 747-8F freighters, ensuring production will continue into the 2020s. Airbus has just written off another 1.3 billion euros ($1.6 billion) on its prob- lematic A400M. This pushed the European aircraft consortium's total losses on the plane, which crashed on a test flight in Spain with the loss of four lives in 2015, to more than 8 billion euros. Volga-Dnepr is also planning to breakdowns only happen "once in a blue moon." The Leipzig hub dates back to a North Atlantic Treaty Organization contract for which Antonov transport- ed military equipment under the Stra- tegic Airlift Interim Solution (SAIS) program before the introduction of the Airbus A400M military aircraft. The one downside of the strengthening cargo market is the rapidly rising slot shortages at large freight airports, particularly in Europe. Cargo takes second place to passengers at Stansted, one of Eu- rope's fastest-growing airports. This has prompted Antonov to shift its UK flights to East Midlands airport, the UK hub for DHL and United Par- cel Service, and Doncaster/Sheffield, a former Royal Air Force base. Amsterdam Schiphol, Europe's third-largest cargo airport, "is a tough one for us and our rivals, too," Bingley said. As alternatives, Antonov is using the smaller Dutch airport of Maastricht and Ostend, the Belgian airport that has long served project cargo carriers. Frank- furt, Europe's largest freight airport, is "off limits" except for humani- that allows the company to operate to and from the US without special authorization from the US Depart- ment of Transportation. The compa- ny has also appointed sales agents in Australia, Japan, and India, markets with growing project cargo potential for the AN-124. Antonov has sought to differ- entiate itself by upgrading the payload of two of its planes to 150 metric tons and carrying unique adaptors that allow each of its aircraft to extend its normal 20-metric-ton crane lift to 30 metric tons. The carrier gets most of its work through air cargo brokers and freight forwarders. The last big one-off project Antonov secured on its own was for shipments to support Exxon Mobil's $19 billion liquefied natural gas project in Papua New Guinea. Construction of that project began in 2010, when Antonov was more than halfway through the Ruslan International joint venture with Volga-Dnepr. Antonov and its peers have ben- efited from a growing trend during the last 15 years toward manufactur- ing project equipment in low-cost regions and transporting them in modules to the site. Antonov flies equipment from Europe to East Asia, mainly China, Korea, and Japan. However, it no longer transports products such as electronics on the return journey. Conventional carriers such as Emirates and Etihad Airways tap that market with their belly capacity. The Ukraine airline's fleet operating schedules have changed significantly over recent years. "Planes don't sit around weeks on end. That's long gone. Two to three days is normal now," Bingley said. This means the aircraft carry big crews, up to 19 on a recent flight. They're mostly technicians who double as loaders and are on hand to perform scheduled maintenance after 500 hours of flight time. It's not easy competing with the 747s, Bingley said. AN-124s burn more fuel than 747s. The Boeing aircraft also can obtain emergency spare parts all over the world, while Antonov must "import" them from Kiev or its maintenance hub at Leipzig, Germany. But Bingley said Recovering oil prices and a resurgence in mining have increased demand for heavy-li shipments.

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