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Shanghai Pudong International Airport Cargo Terminal Co., Ltd.

Shanghai Pudong International Airport Cargo Terminal Co., Ltd. The Challenge of Growth. PACTL Introduction. The Sino-German Joint Venture, founded in 1999, successfully combines the knowledge of the three shareholders Shanghai Airport (Group) Co., Ltd. (51 %), Lufthansa Cargo AG (29%) and

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Shanghai Pudong International Airport Cargo Terminal Co., Ltd.

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  1. Shanghai Pudong International Airport Cargo Terminal Co., Ltd. The Challenge of Growth

  2. PACTL Introduction The Sino-German Joint Venture, founded in 1999, successfully combines the knowledge of the three shareholders Shanghai Airport (Group) Co., Ltd. (51 %), Lufthansa Cargo AG (29%) and JHJ Logistic Management (20%) as one of the top Cargo Terminals of the world.

  3. PACTL Vision Offering superior quality to our customers and being the leading Cargo Terminal in Mainland China

  4. PACTL Services To give our customer the competitive advantage and to be known as one of the best Cargo Terminals of the world is our ambition • PACTL Services: • Import/ Export and Transit Cargo and Mail Handling • Special Cargo Handling (DG, VAL, AVI, PER etc) • Cargo Document Handling • Cargo Inquiring • ULD Control • ULD pallet/ container Handling • Customs Control • Arrange for air-land and air-air transshipment • Miscellaneous Services as mutually agreed • Consol breakdown • DG Training PACTL Transshipment Shanghai

  5. +11% +21% +33% +45% +81% +49% +80% +87% +38% +13% +63% +16% +16% 122% PACTL -Development PACTL operation started in 1999 - with 4 customer – and 2,000 tons per month Source: PACTL Source: Shanghai Airport Operation Centre Presently some 1.700 employees - 36 customer - average 80.000 Tons per month

  6. The Challenges of Growth Capacity customs security cost management competition Quality People market growth training productivity infrastructure services IT others Processes

  7. Capacity – Main Challenges • PACTL was originally designed to handle annually 500,000 tons • In 2003 PACTL was already close to this designed capacity (420,000t) • Further strong cargo growths at PVG forecasted Capacity

  8. Capacity Extensions • PACTL Capacity Enhancements Phase I: • 2,250 m2 T-cargo area • 4,600 m2 Agent Buildup Area • Warehouse 4,200 m2 • Container Storage 5,000 m2 • Parking Area 13,000 m2 • 6,500 m2 additional roof • … • PACTL Capacity Extension Cargo Area (E): • 18,000 m2 warehouse

  9. Airport Expansion • West Extension: • 16.8 square-kilometer logistics park • 8.06 km2 west area • 2.55 km2 cargo area • 33-40 freighter positions • PACTL goes West: • 370.000 m2 area • 140.000 m2 W/H area • cooling facilities • Valuable storage • AVI room • DG W/H • Up to 7 ETVs, palletizing stations etc., scales, x-ray etc. PACTL West

  10. Ongoing & Increasing demands towards processes: flexibility quality demands efficiency speed costs pressure transparency safety and security Processes – Main Challenges Processes

  11. Processes • Quality Steering SystemQuality Measurement & Management; Customer Feedback; swift reaction times • Process Design System… as flexible as necessary to meet customer demands … as standardized as possible for cost efficiency & reliability … enhance to meet latest national and international standards • Cooperation SystemCooperation with national and international associations (e.g. CAAC, TAPA) • Handling IT System: HERMESreal time; data integrity and consistency; customized steering – standard process flow & individual SLAs pre-alert for process control; data and process security • Safety & Security System:Access and exit control, CCTV monitoring, patrol guards, constant supervision, technology upgrades, security and safety training and awareness

  12. Quality Quality – Main Challenges Tonnage increase - higher utilization of capacity - ongoing need of qualified staff to keep and to increase quality Increased demands - customers - customs - society Competition - competitors ‘don’t sleep’

  13. PACTL - Customer • Communication: • easy to deal with and easy to contact • immediate feedback to customer inquiries • joint regular customer meetings • regular customer feedback evaluation • scope: • Intensify cooperation • Better understanding of customer needs

  14. Quality • Training, training, training… • Introduction of new EDI • Optimize procedures, processes and capacity • Concentration on supervisory skills and in-role performance • Listen to the customer - actively (1=very unsatisfied / 2=unsatisfied /4=satisfied /5=very satisfied)

  15. People People – Main Challenges Main Challenges: Recruit find the right persons in the existing salary system Train develop employees to fulfill the requirements of the different jobs Retain avoid the leave of employees after training

  16. +22% +32% Personal development and Challenges Growth triggered by: Increased tonnage Increased demands (customers, customs, qualitysafety and security …) Split and specialized operationIncreased supervision +71% +15% +26% +71% Source: PACTL HR company report

  17. Personal development and Challenges • Use diverse recruitment channels • Create an attractive company image • Cooperate with schools and universities • Retention Management - foster employee loyalty • Develop potentials and give career opportunities • Dedicated training program with external coaching and in-house training. Accredited Dangerous Goods school

  18. Capacity Quality People Processes The Challenges of Growth Sustainable growth can only be achieved by improving on all key elements PACTL to concentrate on the key success factors of our line of business PACTL values present and new customers and identifies their needs for future growth PACTL will observe future developments of our line of business; close cooperation with all key players of our industry PACTL is actively shaping its own future PACTL invests into all key elements All resources on hand shall be used PACTL – a millions tons in 2007 =A million reasons to upgrade the future

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