Over the past decade, Modern Logistics has grown to become the dominant cargo company in Brazil’s logistics market and is the first and only Brazilian company devoted exclusively to cargo services.
Modern Logistics is the only cargo carrier in Brazil that provides an integrated logistics model to serve clients, a key advantage which has driven the company’s market share. Having cemented its position in Brazil’s vast logistics sector, the company now seeks to materially expand its logistics services throughout South America, leveraging its dominant industry position to firmly establish a market presence ahead of emerging competition.
Modern Logistics is embarking on a two-stage strategy for international expansion starting on 15th August 15, according to the company’s CEO Cristiano Koga.
The company’s initial phase will expand Modern’s service to Colombia, Ecuador, Chile, Argentina, and Uruguay. The second phase will target Mexico and the US within six to twelve months. Stated CEO Koga, “We will start with at least two weekly frequencies [for each route]. We are still defining the days of the week. In terms of capacity, it is 20 to 22 tons per leg.”
These expansions are being supported by Modern Logistics’ aquisition of two 737-800 Boeing Converted Freighters (BCFs) over the course of the past year which represents a significant upgrade to its fleet of air cargo aircraft. Modern Logistics acquired its first 737-800 BCF late last year, which marked the first 737-800 ever within Brazil’s logistics industry. Going forward, Modern Logistics looks to acquire additional aircraft for underserved regional airports as part of its five-year plan. “We have options for expanding our fleet. With international accreditation, we will be able to acquire two 737-800 NG aircraft in 12 months,” said Koga.
The availability of the two “next generation” (NG) aircraft, a key milestone for the company, will significantly enhance Modern Logistics’ capabilities in expanding into other Latin American markets, particularly Argentina, Colombia, and Central America, as well as establishing a facility in Miami. For the first time, the larger and more efficient aircraft will position the company to more easily increase market share internationally.
Modern Logistics, founded in 2012, is an integrated logistics company based in São Paulo, Brazil and is a pioneer in the development of a one-stop-shop model using air freighters to provide logistics services that are materially hastening supply chains across the country.
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Both 737 NGs are leased through Babcock & Brown Aircraft Management (BBAM) . The Next Generation of 737s are more cost efficient in terms of ton-miles transported and have a cargo capacity approximately 10 percent larger than the previous generation of 737s. The aircraft have passed certification by PCA Airworthiness and have received final approval by ANAC, Brazil’s aviation regulator.
Modern Logistics CEO Cristiano Koga stated, “We are very excited about the addition of two advanced airfraft to our fleet. The additional capacity and efficiency of the new aircraft will assure the future success of the company by hastening entry into international makets and better responding to the needs and requirements of our clients.”
Currently, Modern Logistics has three Classics 737s in its fleet. The introduction of the new 737-800s is part of a fleet renewal to enhance operational efficiency. As the replacement of the existing fleet will take place gradually, the company will operate both classic 737s and NGs over the near term.
The incorporation of the new 737-800s firmly places Modern Logistics in a greater competitive position within the industry as the bulk of air logistic firms continue to use older, less efficient 737’s which have been converted to freighters. Modern Logistics provides logistic services throughout Brazil and is authorized by ANAC to serve international destinations.
Modern Logistics’ operations are supported by a vast 32,000sf cargo facility at Viracopos which is able to accommodate several cargo aircraft simultaneously. The facility is equipped to meet risk management requirements for transporting high-value cargo across an array of segments, such as industrial, automotive, technology, clothing, electronics, and now pharmaceuticals. More recently, a special distribution center was opened at Viracopos exclusively serving the pharmaceutical sector. The opening of this DC makes Modern Logistics the first integrated logistics company in Brazil to have, in a domestic terminal, its own warehouse equipped in accordance with Anvisa’s requirements to serve the pharmaceutical industry.
With an operation that ranges from ground transport with its own and third-party fleet to a quality cargo and warehousing facility, Modern Logistics is well prepared to serve e-commerce in the “middle mile” (fwith air and road transport from the distribution centers of large retailers;, the “last mile” (distribution center to the customer’s home); and the “first mile” (from the home to the centers). “We have already started operating for e-commerce, and the expectation is that we will grow in this segment from now on,” says Koga.
