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US airport security agency is not ruling out privatization
The acting director of Transportation Security Administration stated on Tuesday that the agency had not ruled out the possibility of considering a plan for privatization, while defending the proposed reduction in screening officers. Why it's important Some Republican Senators want to privatize an agency created by Congress following the September 11th attacks. KEY QUOTE Ha McNeill, acting TSA administrator, said that "nothing is off-the-table" at a hearing of the U.S. House Appropriations Subcommittee. We're willing to discuss new privatization schemes if they make sense. Airports may choose to privatize, while others do not. She said that since the new rules went into effect two weeks ago, nearly 7% (or 7,000) of U.S. travellers are not complying to the enhanced ID requirements for entry at airport security checkpoints. CONTEXT The White House announced earlier this month that it wanted to reduce funding for TSA by $247,000,000, stating "TSA has consistently been found wanting in audits, while implementing intrusive and humiliating screening measures which violate Americans' dignity and privacy." McNeill stated that the budget cuts represented a 3-4 percent reduction in TSA staffing -- half of which was for exit lanes, and the remainder 2% of Transportation Security Officers spread out across 435 airports. In recent years, as air travel increased, the Biden administration expanded the TSA. It now has almost 60,000 employees. In 2024, the TSA screened 904 millions passengers. This was a new record and an increase of 5% over 2023. Homeland Security Secretary KristiNoem stated earlier this month that air travelers without "REAL ID cards" could face enhanced screening procedures, but they would not be denied entry to flights according to the rules which took effect on May 7.
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US to announce Newark flight reductions to reduce congestion
Sean Duffy, Transportation Secretary, said that the U.S. Department of Transportation would announce Tuesday it will be implementing temporary flight cuts at Newark following meetings with major U.S. Airlines to address the impact of congestion. Duffy, a CNBC reporter, said that the Federal Aviation Administration will announce a revised schedule for Newark in order to reduce congestion. The airport has had to deal with a series of chaotic equipment failures, runway construction issues and staffing problems. "We have a structure that determines how many flights we can depart per hour." Duffy explained that we have a schedule for delayed takeoffs. "You will see a reduction." Last week, the FAA held three one-on-one sessions with airlines to "find a balance between their airport operations and meeting the individual needs of each airline." The airlines said they expected that additional flight reductions would be needed on top of the voluntary flight reductions. Duffy responded: "They are the largest player at Newark. And... most (of the airlines) will agree to the cuts." You might need to push a bit harder at the FAA in order to get the numbers you require. United declined to comment. The FAA announced Friday that it would propose a maximum arrival at Newark rate of 28 aircraft an hour until runway construction is completed by June 15, except on Saturdays, until the end the year. Until October 25, the maximum rate of arrival outside the construction period is 34 aircraft per hour. United, Delta Air Lines and JetBlue Airways were present, as well as American Airlines, Alaska Airlines Spirit Airlines, Allegiant Air, Alaska Airlines and Alaska Airlines. United has drastically reduced flights at its Newark hub, and is asking the FAA for new restrictions on flights to reduce delays. Last year, the FAA relocated Newark's airspace from Philadelphia to Philadelphia due to staffing issues and congestion in New York City and surrounding areas. The facility also faced numerous technological problems. The FAA is short of its target staffing level. (Reporting and editing by Mark Porter, Aurora Ellis, and David Shepardson)
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Musk: Tesla is on track to start a robotaxi trial by the end of June in Austin, Texas.
Elon Musk, Tesla's CEO, said that the company will begin testing its robotaxi service in Austin, Texas by the end June. This is despite questions about safety from an American regulator. Musk, in an interview with CNBC said that the electric car maker would roll out 10 self-driving vehicles in certain parts of the city. He added that robotaxi deployment will scale up to around a thousand in a few month. "We will not deploy to the entire Austin area, but to only the areas that are safest." Musk said, "We will geofence the area." In afternoon trading, shares were down less than 1%. Musk's decision to shift the focus of the company from developing a cheaper EV platform in the face of waning demand, to launching its robotaxi service and Optimus humanoid robotics will be critical for Tesla. This bet is a major part of the company's value. Musk said to CNBC that the only thing that matters in the long run is autonomy and Optimus. Many companies have closed shop because of the high costs and regulations that are required to commercialize autonomous vehicles. Alphabet Waymo and the other companies in the race have been under increased scrutiny. Since October, the National Highway Traffic Safety Administration (NHTSA) has been investigating accidents involving Tesla's advanced driver assistance (ADAS) software that is fully self-driving in low visibility road conditions. Last week, the U.S. road regulator asked Tesla to answer some questions about its robotaxi service to see how they will perform under bad weather. Musk stated that Tesla is in discussions with major automakers about licensing the FSD software, which is expected to be used to power its robotaxis.
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Brazil's chicken exporters prepare for rejection of cargo amid bird flu outbreak
The Brazilian meat lobby ABPA (which represents large food processors) said that following the confirmation of Brazil's first outbreak of bird flu, countries including China will not accept chicken consignments being transported from Brazil. In an interview with ABPA President Ricardo Santin, he said that the refusal of cargoes can vary depending on the date of shipment prior to outbreak confirmation. This ranges from 14 to 28 day at the discretionary of the official veterinary services of the destination country. This puts BRF SA, JBS SA and other meat processors in a difficult position as they have to deal with increased logistics costs and the uncertainty of the ongoing trade embargoes caused by the public health emergency. Santin, citing new trade data, said that Brazil accounts for 39% the global poultry trade. Santin stated that the possibility of easing restrictions on cargos in transit exists, especially if they come from a far-off region from the outbreak in the state Rio Grande do Sul. Santin stated that negotiations would be required. He added that Mexico and Chile would also reject cargoes if they were to be affected by bird flu outbreaks. Santin stated that it is impossible to calculate the losses resulting from the export restrictions in place after the confirmation of a first bird flu outbreak at a Brazilian commercial poultry farm. Santin explained that the duration and scope of trade restrictions may differ depending on health protocols and negotiations between importing countries. Will Some health protocols call for regional or local export bans while others demand a suspension of all imports. Brazil has stopped issuing health certificates for all cargoes bound for China, the European Union, and South Africa under existing protocols. Other major importers, such as Japan, the United Arab Emirates, and Saudi Arabia, are less strict, and enforce regional restrictions under the existing protocol. Santin stated that it was up to exporting companies to handle returned cargoes. He added they have the option of redirecting certain consignments. (Reporting and editing by Alistair Bell; Ana Mano, Roberto Samora)
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Rubio: US hasn't discussed the deportation to Libya of Palestinians from Gaza
U.S. Secretary Marco Rubio stated on Tuesday that Washington has not discussed deporting Palestinians from Gaza into Libya. However, he did say that Washington asked other countries to the region if there would be an openness to accept Gazans that want to move voluntarily. "We have spoken to some nations to see if there are countries willing to accept someone for a period of time if they say that they want to leave because of illness, schooling for their children, or whatever else.," Rubio said. He added that he wasn't aware that Libya was included. Rubio told the Senate Foreign Relations Committee the United States were pleased with the resumption in food shipments into Gaza. He added that they understood that 100 more trucks would be crossing in behind the first ones and that there could be many more in the days to come.
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State media reports that Vietnam has approved the establishment of Sun PhuQuoc Airways
The official Vietnam News Agency announced on Tuesday that Pham Minh Chinh has approved the creation of Sun PhuQuoc Airways. VNA reported that the airline's parent company, real estate and hospitality developer Sun Group will invest an initial 2.5 trillion dong (96 million dollars) to begin operations and launch its first flight in the fourth quarter 2025. Vietnam's aviation market, which has a population of over 100 million people, has grown rapidly after recovering from the COVID epidemic, causing businesses to compete for market share. Sun PhuQuoc Airways will operate alongside the national flag carrier Vietnam Airlines as well as low-cost carrier VietJet and Bamboo Airways. The airline aims to increase its fleet size to 31 aircrafts by 2030. The new airline is expected to offer both commercial and chartered flights. According to the website of Sun Group, Sun Air is a premium airline that offers private jet services for wealthy clients. According to official statistics, Vietnam's first four months saw an increase of 23% in visitors compared to the same period last year. 7.7 million tourists visited the country. Sun Group is not available for comments outside of normal business hours. Reporting by Phuong nguyen. (Editing by David Goodman, Mark Potter and Mark Potter.)
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Ride-hailing drivers protest in Indonesia for better pay
On Tuesday, hundreds of taxi drivers and delivery men protested in various cities throughout Indonesia over low wages. They also opposed a merger planned between GoTo, the largest tech company in Indonesia and Grab, a ride-hailing competitor listed on the U.S. stock exchange. In Southeast Asia's biggest economy, ride-hailing services and delivery services are an important part of the transportation landscape, particularly in large cities. GoTo's unit Gojek, which has more than 3.1 million motorcycle drivers on its books, and Singapore-headquartered Grab have dominated the Indonesian market for years. In Jakarta's early afternoon, drivers dressed in their green jackets, helmets, and trademarks, gathered near the President's Office, the parliamentary buildings and the Transport Ministry. The protesters delivered fiery speeches over loudspeakers and waved flags, while holding up posters that criticized what they called unfair and exploitative policies of the company. The drivers, who claim to make between 100,000 and 150,000 rupiah per 10-12 hour day, rode together in a convoy. GoTo stated in a press release that it would welcome drivers' feedback, but that reducing its share of the fares wasn't a good solution. It said that it had received merger proposals from different parties, but "had not made any decisions." Tirza Munusamy is the head of public affairs at Grab's Indonesian unit. She said that Grab respects the drivers' right to express their opinions. She said that the speculation about a merger was "not based on verified data". Raden Igun Wikaksono, head of the online motorcycle drivers association, said that drivers asked the government to make sure they receive 90% of their fare for each trip. Wicaksono stated that although the regulations state that companies can only take 20% of the fare at any time, some companies have taken more. He said, "There are no sanctions in the regulations and the government is always lenient with the companies." Transport Minister Dudy purwagandhi met with company representatives to discuss these issues on Monday. He acknowledged that drivers were concerned about the amount of commissions. In a press release, he said the government is evaluating the scheme. Grab and GoTo have said that they receive a commission based on the fares set by the government. Local media reported that protests were held in Surabaya and Bandung as well as Yogyakarta and Semarang, on Java's main island. Sunardi, a 47-year-old who took part in the Jakarta protests, claimed that the company's discounted fares also affected the driver's income and demanded an end to this practice. Wicaksono said that the drivers feared that a merger of GoTo and Grab could lead to a "monopoly", which would then result in layoffs and "predatory" prices for consumers. Two sources familiar with the matter said earlier this month that Grab was looking to make a deal in order to acquire GoTo by the end of the second quarter. Euromonitor International estimates that if the merger proceeds, it will create a regional giant in the ride-hailing industry with 85% of the $8 Billion market. ($1 = 16,410.0000 rupiah) (Reporting by Ananda Teresia, Heru Asprihanto, Johan Purnomo, and Yuddy Cahya Budiman; Editing by Kate Mayberry)
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Canada - May 20
These are some of the most important stories in selected Canadian newspapers. These stories have not been verified and we cannot vouch for the accuracy of these stories. THE GLOBE AND MAIL Canada Post has been notified by its union that it will be laying off 55,000 workers this week. TotalEnergies of France signed a contract to purchase liquefied gas from the proposed Ksi Lisims facility in British Columbia. However, the Nisga'a Nation's project must wait for the outcome of the pipeline associated with the project whose costs are estimated to have risen by billions. ** On Tuesday, the finance ministers of Group of Seven industrialized nations met in Banff (Canada) to try to de-escalate an international trade war that was started by U.S. president Donald Trump. Washington is trying to direct discussion towards what it believes are unfair commercial practices.
Airlines adjust routes after 'de minimis tariff' causes China-US air cargo to plummet
Industry data shows that air freight capacity between China, the U.S., and Canada dropped by nearly a third this month after a tax exemption was removed for low-value goods leaving China. This has impacted a major revenue stream for Asia’s largest airlines.
Air cargo carriers such as Cathay Pacific and China Southern have benefited from the booming volume of ecommerce from China to America, led by fast fashion retailers like Shein and PDD Holdings Temu.
The temporary reduction in reciprocal tariffs between Washington and Beijing on Monday, from over 100% to more than 50%, prompted U.S. companies to resume their orders from China.
Experts in the industry said that the suspension of the "de minimis duty-free" access for low value shipments from China or Hong Kong to the United States could have a long-term impact on demand.
Marco Bloemen is the managing director of Aevean, an air cargo consultancy. He said that since Monday, there has been a recovery in the capacity for air cargo. But on the ecommerce side, volume has been temporarily affected.
Airlines in Asia are facing a number of challenges, including a drop in air fares for passengers and a possible global recession.
Cathay Air and Korean Air generate around a quarter their total revenues from cargo. The cargo yields and revenues of a number Asian airlines grew much faster last year than the passenger segment.
Aevean's analysis revealed that in 2018, e-commerce low-value shipments made up just 5% of the goods flown from China to the United States.
The pandemic has boosted air freight demand in Asia, and major freight carriers like Cathay Pacific, Singapore Airlines, and Taiwan's China Airlines, have all ordered new large freighters to serve the busiest trade routes.
As "de minimis exemptions" are unlikely to be reinstated, companies like Shein and Temu will increasingly ship their products via sea to the U.S.A. or to other warehouse locations rather than sending individual shipments directly to consumers.
Reports on Thursday indicated that fast fashion retailer Shein had leased a large warehouse in Vietnam, a move which could help reduce the company's exposure to unpredictability of U.S. China trade tensions.
Cathay, the largest cargo airport in the world, said last month that it expected the demand for air cargo between mainland China, the U.S., and Canada to decline from this month as tariff increases take effect.
Cathay didn't immediately respond to an inquiry for comment.
SCRAMBLE
Data from Rotate, an air cargo consultancy, showed that operators flew 26% fewer freight capacities from China and Hong Kong into the United States from the "de minimis suspension" on May 2 to the detente on May 13, compared with the year before.
The capacity was 30% lower than the average for the four previous weeks.
South Korea, which is a hub for cargo and has been benefited by the growing volume of ecommerce coming out of China, experienced a 22% drop in capacity bound for the U.S. between May 2-13.
Korean Air stated in mid-April that it expects the volatility of air freight demand will increase as tariffs are imposed.
China's capacity was 15% higher in the 12 months prior to the fall than it had been the previous year, while South Korea's capacity was 14% higher.
Rotate data revealed that Atlas Air in the United States, which has the largest capacity on the Greater China-U.S. route from May 2-13, had a 28% drop in capacity compared to the same period last year.
Cathay Pacific's capacity dropped by 2%, while China Southern (owned by the Chinese government) saw its capacity fall 30%.
Cargo was the lifeline for airlines that had freighter aircraft during the pandemic, when almost all international passenger flights were grounded.
In financial reports for the period prior to the tariffs taking effect, several Asia-Pacific Airlines stated that they would move capacity onto other routes in order to cope with the fluctuating demand.
Dimerco, a freight forwarder specializing in Asia, announced this month that several freighter services on the China-U.S. route were cancelled. Some capacity was rerouted towards Mexico and Latin America.
Bloemen stated that about 70 freighters temporarily stopped flying on Transpacific routes. However, some of them were used in other markets.
Southeast Asia stands to benefit if manufacturers decide to ship goods from other countries to the United States instead of China, although many of these countries will also be subject to new tariffs.
Singapore Airlines, which is based in Southeast Asia said that changes in trade flows could open up new opportunities.
Singapore Airlines CEO Goh Choon Phong said to the media that tariff issues are unlikely to be as shocking as COVID-19. However, it is likely to be more uncertain. (Reporting and editing by Lisa Barrington, Miyoung Kim, and Kate Mayberry).
(source: Reuters)