Jeff LeeHello and welcome to this episode of cargo facts connect, the podcast of cargo facts, the newsletter of record for the air cargo and freighter aircraft industries for over 40 years. I’m Jeff Lee, editor of cargo facts and it’s Friday, the 26th of April. Last week, the industry came together in Singapore for Cargo Facts Asia, and I had the chance to talk to Singapore Airlines senior vice president of cargo Marvin Tan in a fireside chat. Singapore Airlines is the launch operator of the upcoming A350F, and is working behind the scenes to prepare for the entry into service of the new type in 2026. Tan and I also discussed his background, the market generally, and more. Take a listen.
Jeff LeeNow, Marvin, you were appointed to your current role, almost a year ago. Now. Why don’t you share with us a bit about your personal and professional background? For those who may not be familiar with you?
Marvin TanSure. Thanks. Thanks, Jeff. I’ve been with Singapore Airlines for about 28 years. New to the cargo business. Yeah, most of my career has been spent on the passenger side of the business. So when I came in, in June of last year, a bit of a learning curve, you know, and some would say not the best time to come into the cargo business after the COVID period. But the other way to look at it is that the only way is, so what I have gone through over the last couple of months, reminds me in some ways of how volatile and how challenging in some ways the cargo segment of the business is compared to the passenger segment. I think the first panel talked a lot about the challenges, things like directionality, imbalances, these are really, really pronounced in the cargo segment of the industry compared to the passenger segment. So those are the things that we’re getting to know a lot more about. And of course, working with a team to find out what our strategies are moving forward of trying to deal with these kinds of challenges, which are pretty unique to SIA.
Jeff LeeAnd to go back even further, when How did you get into aviation? And how did you get into the SIA group?
Marvin TanOkay, I am not an aviation person by training. Yeah, I did my degrees in us. But having lived and studied overseas, obviously travel and everything was very interesting for me. So coming back to Singapore, Singapore Airlines, they do have a sort of management development program where they just bring in people with various backgrounds, and to give them opportunities to go and develop within the company and to rotate them. So I felt that was very interesting program for me to to, to hopefully be a part of. So that started my career back in 1996. My that’s not this actually my second job. My first job was in Hong Kong. And in some ways, it’s a bit of a back to the back to the circle type thing. This My first job was actually in garments and textiles in Hong Kong. So now I’m actually carrying the things I used to manufacture and produce. Yeah.
Jeff LeeAnd I mean, you touched on this, you were saying how this is perhaps not the best time. But in other ways, it’s also the best time to be joining. Because you, you’re learning, I’m sure you’re learning so much. And you’re dealing with so many different challenges, that you’re really equipping yourself. Going forward. How would you compare what you’re doing now on the cargo side with what you were doing previously on the passenger segment? I mean, you were, I believe, mainly looking after passenger services and interiors and seats and things like that. And now you’re dealing with planes that don’t have any seats, for the most part in that when you’re dealing with boxes and things.
Marvin TanYeah, I guess the first thing I don’t really miss about the passenger side of the business are having to look up the some of the issues when we dropped the ball in terms of customer services. That part of it is always a painful part because we take a lot of pride in our service. So obviously, when things don’t go to plan, flight delays, baggage handling, I think that is the kind of area where someone has to do the job here. And I’m thankful for the team that I had to work with. But that’s something that happens every day. So that can be a bit of a grind. But I think now moving into cargo side, I think two things one, obviously it’s a very heavy b2b space compared to passenger side. And related to that, obviously, it’s also the drive towards digitalization in the passenger space because it’s largely b2c. So it’s very easy in some ways to scale up once you find a workable platform that your customers and your passengers are happy to adopt. You can roll it up pretty quickly. But here because of supply chain, all the different stakeholders involved. I think getting systems and platforms up and running and all the integration I think tends to seem to be more of a challenge and takes a lot more time.
Jeff LeeNow, going back to the current market and the climate, what’s it like to be leading SAA cargo? I mean, we’ve got so many things going on and the world how are you addressing these, these events and managing your team?
Marvin TanYeah, in some ways, the also the first panel, I think he ever talked, talked with him or discussed with them about what happened in the pandemic, if you talk about the, I shouldn’t say the mother of all disruption events, because maybe that’s tempting trade a little bit. But clearly, the team had to go through that period, you know, obviously, the passenger side of the business had its challenges. And for the cargo side, similar to I think a lot of my colleagues in the industry, you got to find a way to pivot, right? So converting planes to carry cargo, including ripping out of seats to so that you can use the main cabin as well. I think those are the things that the team did over the COVID period. And it just highlighted the need to be ready and agile to look at all these kinds of solutions. Cargo, certainly we are very vulnerable to externalities. Over the weekend, with what happened over in with Iran and Israel, we’ve compiled issues now that we’re going to grapple with, right, because a lot of our capacities and medical, so the flights will go non stop, and they have to go non stop for the passenger experience. But it means unfortunately, cargo gets the short end of the stick, we have to adapt with that, we have to quickly find some solutions worked with our partners, to obviously try to recover the cargo that’s been held back. But at the same time, not knowing how long the situation is going to last. You also have to map out your sales strategies, your freight forwarder engagement in the days and weeks ahead. So this is the kind of thing I guess, particularly in the cargo business, where you really do need to have a team that can react and respond very quickly.
Jeff LeeHow about some of your freighter flights that go to Europe?
Marvin TanYeah, well freighter? The good thing is, we can always do a tech stop. Yeah, I think I don’t think all passengers from Singapore to London will be happy with Techstop. So that is the challenge that we faced with. So we’ve got more options. It may be more costly, but at least you still have options to try to protect the payload as best as you can.
Jeff LeeAnd I mean, generally what’s what’s your view of the current market we’re in? I mean, both globally, but specifically in the Asia Pacific region.
Marvin TanYeah, it’s, I think the panel also covered on the phenomenon the wrong word, but on this movement in terms of E commerce, and how it’s such a driving force, particularly in the last year or so. And we have no exception, we’ve seen that help to lift a lot about volumes as well. It’s it had been a tough first half of the year, last year. And then towards the second half, we started to see volumes pick up again, a lot of that is due to e commerce. And certainly, with the Red Sea situation also coming into the picture. We didn’t see too much of that at the end of the year. But I think after Chinese New Year, we started to see some of that impact flowing through in terms of our volumes. So that’s really where things stand out. The volumes are pretty healthy, but pricing is what is used are what they are and you just have to be competitive or continue to be competitive.
Jeff LeeRight. And hopefully, things will will get better as the year progresses. Speaking of just a quick follow up to that, on the E commerce side, what specific things are you an SAE cargo doing to to manage and address this this growing business segment of the business?
Marvin TanWell, for us, right now, the flows are pretty concentrated in terms of, obviously North Asia to the US and North Asia to Europe. So it’s really making best use of the capacity that we have, we’ve got seven freighters for flights to the US. And I think we have a couple of flights to the Europe as well. So we are fully maximizing those opportunities. The challenge we can’t get always is it’s not a problem. Mounting more services that way, is trying to make sure you can make the numbers work by also filling the return late. So I think that’s something that we have to work very closely with, in terms of our folks in the US and Europe as well. are looking at partnerships. I think the first group our first panel also talked about partnerships, it’s also very important for us to try and connect the dots to look for opportunities.
Jeff LeeAnd then we come, of course, to your e 350s. Of course, you were one of the first identified airlines or customers to order or to commit to the e 350. F. And you in fact, were the first 747 400, free to operator to pick the 350 to replace those seven, four sevens. How are you and your team preparing for the arrival of these brand new freighters?
Marvin TanYeah, it’s a it’s really a lot of work. In right me. So I think we really have to go through all of our processes, our systems, our training, our preparedness, even staff engagement with a fine tooth comb. Clearly, it’s not only just the introduction of the new fleet, but for us, it’ll be the first time really that we have had had to have a mixed operation for a period of time until obviously, when we retire the seven possible 400. So a lot of work on that front, not only in terms of getting on the aircraft itself, but also in terms of the ecosystem, the operations, the UL, these are loading equipment with all our ground handling agents and service partners. So a lot of work, I think, lined up to help us get ready ahead of the EIS in 2026.
Jeff LeeDuring this this period when you’ll be operating both types, you’ll obviously have more capacity than you do now. But when you do remove those you’ll kind of be taking a weigh capacity again. How do you balance that? And how do you think about that when it comes to offering offering this capacity and making use of it?
Marvin TanYeah, it, we can actually rule out the possibility that we may be prepared to go a little bit under capacity. Depending on the situation, depending on our landscape at that point in time, if demand is sluggish at that point in time, we’d have no, because we have to make some decisions is quite costly to go ahead with some of the HMB on the SSIs. So we do need to make a call as we get closer to the date to say, depending on the capacity that we need, at that point in time, we can go either way, at the keyboard a bit longer, but at the same time to clean make an exit with seven portfolios.
Jeff LeeSpeaking of the this transition from the seven footballs to the 350s, I have a question here from the audience is downgrading from the 747 400 F to the A 350. F, a vote against cargo groups at Sia?
Marvin TanIt’s in terms of the payload is actually six or half 1000. I think it’s pretty close. From an operational perspective, I think two things one, obviously, you lose a nose loading capability for us is a fairly small segment of the cargo. So I think it’s manageable for us. The other aspect, of course, is more just in terms of I go into detail operations, the loading configuration, because of the different contours of the aircraft, so some adjustment there. But if you’re talking about payload, I think the max payload differences about three to 4%. And, of course, bear in mind, we have 774 sevens, we could have up to 1218 50s as well. And then you add on all the beliau capacity that we’re also adding the we have 140 White bodies now, across the SIA group, we have orders for another 45 more planes coming in between now I think within the next five years. So there’s still a fair bit of capacity.
Jeff LeeHow, how do you balance that with your freighter fleet? And how does that influence whether you are how you think about your where you operate your Freighters versus the bellies, belly operation?
Marvin TanI think it gives us certainly a lot of flexibility in terms of how we want to configure that network with all that kind of value capacity. And clearly operators will go to most of the major Fortune, LA’s Hong Kong, Brussels. I think one of the benefits of having this kind of relationship is because when you look at the directionality of cargo, some right over the last, I guess, couple of years looking at us, I think it has sustained a lot of their freight operations. So you see a big injection of greater capacity coming into the market during COVID. And also remaining as we speak. But I think as operating conditions maybe start to change, we’ve seen handling costs, fuel costs is very high compared to pico bid. When we look at that picture, and we start to look at the US start to move. And if that sort of gap, if you want to call it that narrows, I think we have to take a very close to get free to operations. And as long term sustainability, I think that definitely How It Works has to be in tandem with how we also deploy our medical capacity, I think there will be opportunities where the numbers are very strong, very robust, make a very good case for freight operations. But for other routes, because of network is very important for us. Having the balance between passenger and belly hole will help us ensure that the network is still sustaining strong.
Jeff LeeNow, it’s obviously very, very hard to say and to look forward as to what’s going to happen. But how would you assess, you know, the next few months in terms of the market? And where do you think, by the last, let’s say, June, halfway point of this year? Where do you think we’ll be?
Marvin TanIf you ask me about the passenger in the next few months, I could tell you. But for cargo, it’s tough. Honestly, you can see over the weekend with the new inject that we’re having to grapple with. It’s really looking almost like a week by week basis. We were getting a bit of a purple patch with the Red Sea. Again, I don’t know how long that will last. So all these factors come into play in terms of us figuring out how best to make use of the capacity that we have on hand, until of course the 350s come online.
Jeff LeeRight. Well, speaking of the 350s we I’m sure we’re all looking forward to seeing your first one painted and delivered to Singapore Airlines and eventually start flying around the world. So thank you so much, Marvin, for talking to me and sharing your insight with us.
Jeff LeeThat was Marvin Tan, senior vice president of cargo at Singapore Airlines, talking to me at Cargo Facts Asia in Singapore last week. And that’s all the time we have today. For more coverage of the freighter aircraft market, visit cargo facts.com. Thank you very much for tuning in, and join us again next time.
