Cargo Chat: Samuel Israel

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Samuel Israel is Damco’s regional CEO for the Latin America region. Israel has more than 30 years of logistics experience, previously serving as country manager for Mexico at Danzas and as CEO for DHL Global Forwarding Latin America. Before moving to Latin America in 1999, Israel, a French national, held various jobs in France. He talked with Air Cargo World about the future of the Latin American air cargo market and of Damco.

 

What is your outlook for the Latin American airfreight market in 2014?

We’ve seen some continued growth in the airfreight demand. And the load factors, that we’ve been checking with the carriers lately, show also some growth in capacity, so these are positive indications, positive trends, but the levels are still below the industry average. This is an overall observation. Maybe more specifically to Latin America, what we have seen is that some carriers have enlarged their fleets, people like Centurion…Panama is really staying the focus of many carriers and is slowly but surely becoming an alternative to Miami, although I think Miami has still a dominance in this market that will not be questioned for many years to come.

 

What is the outlook for Damco Latin America’s airfreight business in 2014?

Damco has embarked on a transformation program called One Damco, which means a concentration of service center or customer service in geo-strategic points…We are definitely eager to join the top 15 airfreight forwarders in the marketplace before 2015, and this will be achieved again through this transformation program, which, as I mentioned, definitely is primarily a growth program – and this growth is going to happen through an extension of our footprint. We are going to move from 300 to 600 sales offices and representative offices in the next few years and therefore, this will give us a much larger opportunity and presence to promote the airfreight product in the organization…As for Damco’s airfreight strategy in the region, and this has started before my time, my predecessors started structuring the product in the region, so we have established operational centers in Mexico and Brazil. Panama is in a migration mode as we speak. The focus, I must say, and also based on our existing customer portfolio but also market trends, the focus in Latin America for Damco is to definitely leverage our strengths in geographies like Asia, where we are one of the main loaders in the market out of China and Southeast Asia. And we are consolidating our trade lane approach with Asia as we speak…We also have a strong presence in the perishable market, particularly in oceanfreight…and we aim at eventually getting in a very selective mode into some airfreight perishable businesses. And last but not least, we are working more and more, closer and closer with the major Latin America air carriers to improve the relationship to improve our capacity and at the end, to improve the service we’ll be delivering to the customer, including optimizing the cost. So far, we’ve been getting very positive feedback from the carriers on this aspect…We have identified as another area to focus is the intra-Latin-America market, which as you know has grown substantially in the marketplace, and we aim at capturing our fair share of market there. And this is probably around consumer sectors – high-tech, health care, primarily where we have already some substantial expertise globally but also regionally.

 

Besides perishables, are there any other sectors that are gaining importance in the air cargo market in Latin America?

If you’re not in perishable, you’re not in business, at least in the export. And that’s why I mentioned that we want to have a very selective approach, and from my previous professional life, I had some substantial exposure to the perishable market and I’ve definitely come to the conclusion that our approach at Damco needs to be very, very selective. So that’s first thing on perishable. I think in general, Latin America market is – because of the growth and probably consolidation of the middle class, and the access to credit and the buying power which has somehow been stable and growing steadily in spite of the economic crisis, which probably has affected more in a heavier way some other geographies – the consumer sector is probably the fastest-growing sector in Latin America…Airfreight is more and more used in the [consumer electronic] sub-segment, and this is probably a growing segment within the airfreight market in Latin America. And, of course, this is very much related to inbound obviously from Asia but not limited to Asia, but also within Latin America.

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