he air cargo charter broker market could become a lot stormier this year. And that doesn't count the expected challenges of locating capacity to organize last minute ad hoc freighter flights to the far-flung corners of the globe.

The turbulence is set to come in the form of increased competition from the brokers themselves.

The air cargo broker business is recognized as the "must do" end of the air freight business. Rate considerations go out the window as priority to deliver urgent, often outsized shipments become the prime objective. It is a close-knit community, where knowledge and experience comes from just a small elite cadre.

But that community is about to change in coming months. Until now two companies have dominated the air cargo brokerage scene globally, Air Charter Service and Chapman Freeborn, both of the United Kingdom. Their nearest rival has been Air Partner, also UK-based.

Air Partner is the global leader in passenger charter brokerage, with freight forming a lesser part of its business. But quietly over the last couple of years, the company has built up its air cargo brokerage business and now says it wants to be the top dog in both markets.

New Blood

Richard Smith has been brought in to head up the rebranded Air Partner Freight operation. He joins the company after tenures as business development manager for both the UK's HeavyLift Cargo Airlines and Russia's Volga-Dnepr Airlines.

"We are not making any avowed aim that we are determined to take over the top spot in the cargo broker market," said Smith. "But when you are the market leader on one side of the business there is a natural inclination to think you can repeat that success on the other side."

Smith has not set a timeline to achieve even the most modest goals with the revamped Air Partner Freight business, but clearly he is a man on a mission.

"What we have set about doing as a priority is to establish cargo broker specialists in the key locations in our existing passenger network of offices, Smith said. "This has included locating dedicated staff to our offices in Germany and Dubai, which are both beginning to generate substantial business for us."

To break into the Asian market, the company recruited Karl Yam, previously an analyst with a major cargo charter broker in Hong Kong and brought him to the UK to establish the groundwork for its Asia operation. Japan is another priority for the company and will be handled separately from its Asian business.

"North America and the U.S. in particular is obviously also a very big priority for us," Smith said. "It's essential we get our own professionals on the ground as soon as possible and that is something I expect to see happen in the near future."

Smith says he's also keeping a close watch on less developed cargo charter markets such as India, where business is beginning to build.

Charter Built

Air Partner Freight isn't making a cold start in the cargo charter broker business.

Often, on the back of its existing passenger brokerage business, it has won substantial cargo charter contracts. The company is the main provider of both passenger and freighter capacity for the UK Ministry of Defense. Meaning, at present, the company handles numerous cargo charters to both Iraq and Afghanistan.

Simultaneously, the company enjoys considerable success in the commercial market, setting up ad hoc cargo charters to move every conceivable type of cargo, invariably at short notice.

"What we're now seeking is to establish a stronger rapport with this market segment," Smith said. "We want to achieve that by working more closely with the freight forwarders, at a local level, who still traditionally drive this market."

Smith's antecedence points to a close association with the heavier end of the market, particularly the giant AN-124. And most of the leading brokers want a piece of the lucrative outsize market.

Looking at future prospects, Smith said 2008 began with the AN-124 being very much in demand. "The capacity is there usually, but it can be hard to find at times," he said. "It will be interesting to see how that segment of the market shapes up through the year and if we can create a bit more slack."

Smith said the recently introduced re-engined IL-76 is proving a welcome addition to the market, effectively reprising its original role. But again, scarcity of new-built capacity is currently making the aircraft an expensive option.

The air cargo charter market is no doubt set for another interesting year ahead. Just how interesting it gets, could be up to the cargo charter brokers.

SEKO France

Supply chain provider SEKO is expanding its operations in France with the additional operations in Le Havre, Lyon and Marseille.

The company has appointed logistics veteran Jason Denne General Manager of SEKO France to lead its expanded efforts in France in areas of aeronautics, telecommunications, automotive, electronics and cosmetics. Denne will also help to develop new business in the retail arena, such as clothing, footwear, fashion and textiles.

"With the extensive SEKO global operating network and our local representation, SEKO France is well positioned to provide consistent and highly effective innovative solutions that deliver service excellence while reducing total supply chain costs for customers."

Denne has been in the logistics field for more than 20 years. Prior to joining SEKO France, Denne worked for five years for Schneider Logistics Europe in Venlo, The Netherlands.

Denne will report to Joel Glusman, president of SEKO France.

… Briefly

Cargo traffic for European airlines grew 3.5 percent in November, including a 5.1 percent gain in North Atlantic business, according to the Association of European Airlines. ... AirBridge Cargo, part of the Volga-Dnepr Group took delivery of its first of three 747-400 freighters. … British Airways will spend $1.7 million to expand its perishables handling center at London Heathrow Airport, adding space and a border inspection post for the site. … Lufthansa Cargo's traffic grew 4.3 percent in 2007, including a 2.9 percent gain in December. Asia-Pacific cargo traffic soared 14.4 percent in December and was up 8.4 percent for the year over 2006. ... Amsterdam Airport Schiphol's cargo traffic grew 5.5 percent in 2007, outpacing passenger growth, and airport managers Schiphol Group project cargo business will expand 4 percent in an otherwise stagnant 2008. Cargo traffic at the airport grew 10.2 in November, including a 17.6 percent jump in trade with Asia. … Cargo traffic at London Heathrow Airport grew 3.9 percent in 2007, to 1.313 million tonnes, helped by a 16.8 percent surge in December. … Luxembourg-based CHAMP Cargosystems acquired SOFTAIR, a German provider of software to cargo carriers. ... CargoWise, a supply chain logistics services provider, has been selected by forwarder DSV Air & Sea to implement a global enterprise software system. … CMB and the Petercam Group will acquire from Imperial Holdings its share in the Air Contractors Group, a European air freight and aircraft leasing business. … Personal computer shipments in Europe grew 17.7 percent in the third quarter, including 23 percent growth in Germany, according to Gartner Group. … Belgian freighter operator Cargo B announced weekly 747 flights to Sao Paolo, Brazil, through Senegal. … Forwarder GAC opened a station in Prague, Czech Republic. … Cargolux added a second gateway in Kazakhstan with weekly 747-400 freighter service through Atyrau. … Israel Aircraft Industries' net profit grew 51 percent in the first nine months of 2007 to $107 million and sales of $2.4 billion were up 14 percent over the year before. … The United Kingdom's Civil Aviation Authority could allow airport operator BAA to charge airlines 16 percent more in landing fees in 2008 over 2007 at Heathrow and 8.2 percent at Gatwick, according to published reports. … Toymaker Mattel signed a five-year contract to have French logistics provider Geodis manage its Northern European distribution center in Venlo, the Netherlands. … Finnair named VIA Belgium its cargo general sales agent in Belgium and Luxembourg. … Centurion Air Cargo named SKY XS as its general sales agent in the Netherlands for the airline's DC-10 freighter services in Latin America. … El Al Israel Airlines showed a $41.2 million net profit in the third quarter compared to a $1.4 million profit the year before, and its operating profit grew from $8.5 million last year to $63.8 million in the 2007 third quarter. … Forwarder SEKO expanded its operations into Dublin near the international airport and the Dublin Sea Port Tunnel. … Swift Global Logistics opened two offices in Africa - one in Goma, in the Democratic Republic of the Congo, the other in Maputo, Mozambique. … CHAMP Cargo Systems signed five small airlines, including Uzbekistan Airways, to its airline cargo management system. … Airbus delivered its second production A380 to launch customer Singapore Airlines. … The Volga-Dnepr Group reported a 49.6 percent increase in revenue for the first nine months of 2007 to $720 million, reflecting the continued strong growth of the Group's AN-124 and IL-76 charter business and 747 scheduled operations. … Annual air freight throughput at Frankfurt Airport reached a new record of 2.1 million tons. … Austrian Airlines added Sochi and Nizhniy Novgorod to its network, giving the carrier seven destinations in Russia. Austrian's cargo traffic fell 21.5 percent in the first 10 months of 2007. ... Cargo traffic at Virgin Atlantic Airways grew 8.1 percent in October, pushing traffic at the carrier up 13.4 percent in the first 10 months of 2007. ... Babcock & Brown, a commercial lessor of aircraft, declared a fourth quarter cash dividend of $0.50.