1 Jan 2013

Introduction


The Air Cargo Market


The Air Transport Mode

For someone who wants to send a shipment door-to-door and over a medium to long distance fast, the air transport mode will best fit this purpose.

With air transport, cargo can be transported in different types of aircraft:
  • Passenger aircraft 
    • in the cargo area below the passengers, the so-called "belly" 
      • look here for an example: the Airbus A320 (ANA) 
      • look here for an example: the Boeing 737 NG (Boeing) 
      • look here for another example: the Airbus A380 (Emirates on Airliners.net) 
      • look here for another example: cross-section of the Airbus A330 fuselage (Wapedia) 
    • in the passenger cabin as hand-carry by a so-called "on-board courier" (OBC) flying as passenger, sometimes also called "hand-carry services" 
      • the OBC is mostly an employee working for a forwarder or courier service (see below) and can also take care of the total door-to-door transport, all eventual customs formalities for export or import, as well as the hand-over at destination 
      • this type of service is mainly used for very urgent or valuable documents and small goods ; as with all cargo services, also here the entry requirements and customs regulations of the country of import, as well as the regulations for restricted articles on board of the aircraft must be known and adhered to 
  • Cargo aircraft, or: Freighters 
    • on the main-deck or in the belly ; by means of nose-loading, where the whole nose is opened, or side loading, through a large cargo door 
  • Combi aircraft 
    • on the main-deck behind the passengers’ area with side loading through a large cargo door, and in the belly 

As you can see in the examples above, the dimensions of the aircraft can vary, which of course also influences the amount of passengers and/or cargo that can be taken. The amount and weight of cargo that can be carried depends a.o. on the fuselage dimensions (esp. the diameter) of the aircraft. For the bigger aircraft or airliners a difference is made between narrow body and wide body aircraft.

See also the "Cargo Aircraft Specifications" item in the right-hand column of this website --->



Volga-Dnepr Ilyushin Il-76 freighter



Air Cargo Facts

According to IATA, in 2016, airlines transported 52 million metric tons of goods, representing more than 35% of global trade by value but less than 1% of world trade by volume. That is equivalent to $6.8 trillion worth of goods annually, or $18.6 billion worth of goods every day. Find out more interesting air cargo facts (pdf).

According to plane maker Boeing in 2012, cargo-only aircraft or freighters handle about 60 percent of global airfreight shipments, while passenger planes fly the other 40 percent in their bellies.

On average, cargo business generates 9% of airline revenues, representing more than twice the revenues from the airlines' first class passenger segment.



Shipping By Air: Parties In The Market



Someone wants to ship a parcel from Los Angeles (LAX) to Hong Kong (HKG)



From a potential shipper’s or customer’s viewpoint, the international (door-to-door) air cargo market can be divided in four major supplier categories according to their core business:


The real air transport (or: airport-to-airport) part is actually outsourced by these companies to an air operator or airline (except in case of the Integrators, that operate an in-house aircraft fleet for the main part of their air transport needs and outsource only partially).

The combined airlines have the biggest share of this world wide air transport market for cargo.

So the above mentioned Postal companies, Couriers, Integrators and Forwarders, are the cargo customers of the airlines ; and thus the airlines are their suppliers or partners.

The air cargo forwarders are the ‘traditional’ and still most important customers for the airlines. According to FIATA, forwarders contract, book and process over 80 per cent of international air cargo consignments. They compile the complete and (where necessary) customized door-to-door (D2D) air cargo supply chains for their customers, which are often called end-customers by the airlines. The airlines deliver the airport-to-airport (A2A) transport in this chain.



The Air Cargo Supply Chain

When a demand on one place is supplied from another place with air transport as the main transport mode, an air cargo supply chain must be compiled.

Air transport is relatively expensive, but often the fastest mode of transport available to cover medium to long distances.
Therefore typical air cargo consists of goods with a high value and/or an operationally or commercially critical delivery time (high financial breakdown risk):
  • Airmail, diplomatic mail 
  • Live animals, hatching eggs, human organs, human remains, medical supplies 
  • Express parcels 
  • Perishables (food, flowers, dry-ice shipments) 
  • Pharmaceuticals 
  • Valuables (money, gold bars, diamonds) 
  • Technical supplies (high tech, oil & gas, aerospace, automotive, ship spares) 
  • Luxury consumer goods (electronics, fashion goods, accessories) 

A typical air cargo supply chain consists of the following steps:





(yes I know you'd better get to HKG the other way round but I have no other map, and besides we need this set-up further on in the process... :)



A good (2009-2010) presentation on the air cargo market can be found here on slideshare.net: Air Cargo 101.

Read about the most important differences between the passenger airline industry and the cargo airline industry here on Air Transparency: The unique air cargo industry.






Cargolux Boeing 747-400F takeoff




I invite all of you in the industry to contact me for corrections or additions, 
and who are new in the business to question me 
in order to improve the information on this site! 



go back to: Start Page >>>

move on to the first process step: Shipping >>> 














58 comments:

dangerous goods training said...

One of my dream jobs from the past is to be able to travel around the world. Even if it would just have to take a day for a country. For jobs like those shippers, I'm sure they are enjoying it as they get to be in a lot of places - well, of course I know the job could be demanding and it is not always fun but it is a great way to be seeing the world for free and while earning good money.

Anonymous said...

Using air cargo charters is the quickest way to move your freight or cargo over long distances it can also be very costly. If time is not of the essence and price is more of a factor you might look into shipping.

Josh said...

I agree completely with Ashe here. But, Cargo Aircraft Charter is one of the best ways to quickly move.

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Nice post! I'm so glad to get to visit this site. Thank you for sharing this interesting and informative post. I'll be looking forward for your other posts as well. Keep it up! In October of 2011, the last available statistics showed there where 25,746 domestic flights and 15,685 international flights which departed from Logan International Airport. For domestic operations this allows us a choice of approximately 860 flights a day to either direct ship or connect from other hubs for our Next Flight Out operations.
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Sweet stuff here! Do you do any cargo shipping in Tukwila, WA? That would be great!

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Air shipping is also an essential means of transportation through which people can transport their luggage easily.

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Megan Jones said...

I didn't know much about the air shipping process until I read this article. It makes sense that it can be complex at times because there isn't always a plane going to every place that something needs to be shipped to. Though last Christmas my mom sent a package to my brother two weeks before Christmas. He lived in Utah, but for some reason the package went out to Louisiana when it was originally sent from Oregon. That is still a bit confusing to us.
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This was a good explanation of Air freight forwarding. The bulleted points and the images makes the article more reader friendly. Thanks!

JL Freight said...

Shipping via air is the quickest way ship any cargo to any destinations. This is a good explanation on how air cargo works and the role or Airport Logistics offering companies.

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