Hactl Company Visit

During the course, we had an opportunity to visit Hong Kong Air Cargo Terminals Limited (Hactl). Hactl is one of the leading air cargo terminal company in the world because of its specialized cargo handling facilities, a comprehensive range of services, and innovative technology. It aims at providing the highest standard of air cargo delivery services, and the most efficient trucking and logistics supports for cargo as well. 

Company Background
Hactl was founded in 1971 and is located at Hong Kong International Airport, which has been the world's busiest cargo airport in 2010. In order to become the market leader of logistics industry, Hactl strives to deliver consistent and high quality services to over hundreds airline companies and freight forwarders, e.g. DHL Express. It offers a full range of value-added services including pre-arrival customs clearance, import scheduled collection, and schedule empty unit release, to satisfy customers’ needs. 
Due to tons of data transaction need to be processed, Hactl mainly invests a lot in innovating technology for smoothing information and logistics process. Airline customers can check status of cargo when simply using cargo tracking services through the internet and apps. And secure storage and world-class facilities improve efficiency for all cargo types, from refrigerated to valuable goods, and sizes. Moreover, it partners with HACTL Solutions Limited (HSL), its wholly-owned subsidiary, to provide an integrated supply chain management solutions to strengthen the logistics connectivity. 

Visit Agenda
When we arrived the company, it first introduced its company background, business and services through a video. After finishing the Q&A session, they provided us a tour at the Superterminal 1, which is the single largest multi-level air cargo terminal in the world. We can walk around the terminals to be nearer to cargos and freights. The ramp handling, where Hactl crew members did the loading and breakdown cargo processes, passed besides us. Furthermore, we saw the eco-car, an environmentally friendly vehicle for transporting documents or crew members.


Q & A

1.   In case of facing extreme weather problem, what is the contingency plan of Hactl?

A: If typhoon signal no.8 or above is hoisted, people are prohibited to work at aircraft parking apron. Due to the inclement weather, flight schedules would continue to change, and then the cargo would be hoarded up. In order to ease the cargo bottleneck, Hactl works closely together with airlines to help handling cargo process. When the typhoon signal is cancelled, more frontline staff would be mobilized to help with the resumption of orderly and efficient operation in the apron.

2.   Nowadays, the global warming is a hot issue. What is Hactl doing to reduce its carbon footprint?

A: There are several ways to reduce, the first one is by recycling the plastic wrapping used in packing cargo. When the cargo is ready to load up, the plastic can be put in the collection bins, and then collected to be recycled. Second, Hactl introduces the biofuel for forklift trucks using less gas and produces cleaner and fewer emissions. Also, electrically-power cars (E-car) are available for transporting documents or small cargo. To power these vehicles, charging stations have to be set up. Lastly, Hactl has also coordinated with customers if they hoped to use e-flights to reduce the use of paper documents. It is called E-freight scheme.

3.   Hactl had no competitor in the past. How has Hactl formulated its strategy as they are no longer the monopoly to the market?

A: In the past, there were few competitors; the largest one was Asia Airfreight Terminal, which took about 20% of the market share. So, Hactl domained the market and took around 80% of market share. After Cathay Pacific, which was the main customer of Hactl, constructed and operated its own terminal- Cathay Pacific Cargo Terminal, cargo volume have dropped by about 30%. Then, Hactl had do lots of preparation about this dramatically big change. In fact, this terminal was not suddenly announced to be built, Hactl knew Cathy Pacific will build its own terminal long time ago. So, its team had enough time to do a contingency plan. In the past, there were tons of air cargo shipped into Superteminal1 every day. During the peak season, there was not enough space to receive other cargos from new airline customers, so lots of businesses have been rejected. And because of a plenty of and bulk Cathay Pacific cargo demand, there was little resources to provide premium customer services. However, now, it can absorb new or small-scaled airline companies with more manpower and capacity available. The excess resource can also help to diversify its business to a one-stop logistics service. Hacis, its subsidiary, provides transportation services. That means, customers can not only enjoy storage services, but also the logistics services for helping shipment into Southern China.

4.   One of the core values of Hactl is the logistic support between Hong Kong and mainland china. What is the logistic support of Hactl right now and how will they continuing improve this core value?
A: Hactl basically has one major logistics supports for the mainland. Its subsidiary- Hacis provides SuperLink China Direct service, a customized solutions to meet the increasing demands of cargo connection between Hong Kong and the Pearl River Delta Region (PRD). Some goods arrive in Hong Kong and then need to be transported to southern China, e.g. Shenzhen, Xiamen and Fuzhou. Then, its self-owned truck teams can provide efficient and logistics support to those customers. Besides, she stressed that Hactl has professional truck teams to help transport special goods. Take drugs as an example. They are regarded as temperature-sensitive goods, so some trucks are designed with a temperature-controlled environment to transport drugs.

5.   As the infrastructure and carrier are getting depreciated, is the cost of maintenance a heavy burden for your company?

A: Maintenance is very important since all facilities and systems are fully automated. And Hactl’s facilities are very famous in the world, many worldwide terminal company visit Hactl for reference. If the facilities are broken down and the power is short supply, engineering department would repair them. And facilities keep maintenance regularly to ensure they can be 24-hour operated. Maintenance is regarded as an investment rather than a burden.

6.   Training is important in the cargo industry as mistake is unacceptable, what major practices did you provide to your workers?

A: As Hactl believes that employees are company’s greatest assets, it puts more resources into recruiting, training and retaining qualified employees. They can learn how to store basic cargo, and how to handle dangerous goods by IATA DG Training so as to reduce probability of accidents happen. Then, Hactl’s team can be more knowledgeable and professional to help Hactl become more competitive with the market’s need. Apart from its own employees, Hactl also provides training to competitors’ employees as long as they pay fee.

7.   Commitment on service standards is increasingly important for the air cargo industry, especially security issues, which refers to the safety of the goods in transit, since it affects the inventory level and stockout costs. How do Hactl improve the service performance with safety measure?

Scenarios such as:

• Airport security and threat of terrorism

A: In Hactl, there is no passenger; only cargo there. Some cargo may be cash or valuable goods. To keep safety environment, 1000 24-hour of CCTVs have been set-up to monitor activities inside and outside the buildings. Hactl has also outsourced 2 specialized security companies, which are Avseco and G4S, to carry out regular patrols

• Airspace congestion (collision)

A: This is not Hactl’s responsibility, but is Civil Aviation Department’s.

• Cargo mishandling cases, e.g. unmanifested, shortshipped, unlocated

A: To deal with these cases, Hactl relies on CCTV. If the cargo are mishandled, Hactl can trace the point of departure. And COSAC-Plus has developed superb performances for customers to monitor status of their cargo.

• Special arrangement for bad weather condition

A: This refers to question 1.

8.   Hong Kong government has made continuous investments in terminals and operating infrastructure in order to boost the handling capacity of HKIA. How do Hactl catch this kind of business opportunities to generate more revenue on air cargo terminal operations?

A: After building the third runway at the Airport and Hong Kong Zhuhai Macao Bridge, there would be more traffic flow and even more airlines would come to Hong Kong. Despite of carrying too much uncertainty, Hacis continuously helps Hactl to diversify its business so as to ties in with these developments. Also, Hactl has more capacity available for its new customers to catch the opportunities.

9.   It is the fact that the competition between Hong Kong airport and other mainland airport is getting fierce. Is air transportation industry still profitable now? What is the future outlook of Hong Kong air transportation industry?

A: In last year, cargo volumes increased by 2.4% in Hong Kong and increased by 1.4% worldwide. HKIA forecasted that there will be an increase of 4% about Hong Kong cargo volumes in 2014 and airlines estimated there will be 3.2%. So, the air transportation industry is still profitable and can be continuously developed.

The re-export trade becomes more important in Hong Kong since some countries’ flights cannot fly to Europe directly, e.g. Vietnam. As Hong Kong is a transshipment point, there is a steady increase of the transshipment business in Hactl. So, Hactl increases capacity available for transshipment cargo, and creates business strategies and facilities to focus on transshipment.

10.  What is the policy or strategy of HACTL in the area of CSR? How do HACTL contribute to the community and being a sustainable responsible business?

A: CSR can be refer to question 2 about doing environmentally friendly works.

Hactl maintains business strategies for sustainable development of itself and terminal industry, such as providing customized solutions.