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Cutting the paper

E-freight adoption is moving more slowly than anticipated – but while initiatives like eAWB360 will help encourage faster progress, it is down to operators and their customers to change their mindset from paper to digital. Kerry Reals reports

The air cargo industry is moving grindingly slowly towards adopting paperless operations, forcing IATA to lower its e-Air Waybill (e-AWB) global penetration target for 2016 to 56%, from its original goal of 80%.


Companies already on board with the e-freight initiative that have made good progress point to a need for greater technology investment and a complete change in the industry’s mindset to ensure more widespread adoption.


E-freight was launched by IATA in 2006 as part of its ‘Simplifying the Business’ programme. Its aim was to get carriers, freight forwarders, ground handlers, shippers and customs authorities to work together to digitise the process for transporting goods by air, beginning with replacing the traditional paper Air Waybill with an alternative electronic contract – the e-AWB.


But the fanfare that accompanied the initiative’s launch a decade ago has been somewhat muffled by the air cargo industry’s slower-than-expected response. Global e-AWB penetration in 2015 peaked at 36%, falling short of IATA’s 45% target. The association responded with the aforementioned slashing of its target for this year to 56%.


“E-freight kind of stalled because its original concept was extremely ambitious, it was comprised
of multiple levels of modules,” says Steve Hill, a principal industry consultant for IT solutions provider, CHAMP Cargosystems, who has been involved with the e-freight initiative since its inception. “Uptake has been slower than the industry expected, and it’s difficult to put a finger on one reason. Ultimately, there is a transformational element to this – in procedures, policies and the way people have to work in their day-to-day business.”


“The initiative has not progressed as effectively as we expected or wished,” says Hill, adding that e-freight implementation still has a long way to go.


Speaking at the IATA World Cargo Symposium in Berlin in March, Director General, Tony Tyler, described global e-AWB implementation as a “struggle”, lamenting the air cargo industry’s slow embrace of digital processes, in comparison with the more rapid technological changes that have occurred on the passenger side of the business.


“To support the industry to accelerate implementation we have launched eAWB360, which is a community-based approach to e-AWB introduction,” says Tyler.


The eAWB360 campaign kicked off in Europe in February and is described by IATA as a 'call to action' at selected Airports that have a favourable regulatory and operational environment for e-AWB. In March, the campaign moved to North America, where nine airports have signed up, including Toronto, New York JFK and Chicago O’Hare. The idea is that e-AWB will be offered to all customers and all destinations at these selected airports, enabled by a single process service and common standard operating procedures for e-AWB.


Just nine airports contribute more than half of the world’s total e-AWB volume, these being: Hong Kong International; Singapore Changi; Seoul Incheon; Dubai; Taiwan Taoyuan International; Amsterdam Schiphol; Paris Charles de Gaulle; London Heathrow; and Chicago O’Hare. The top three airports by volume in IATA’s February monthly e-AWB report were all in the Asia-Pacific region, with Hong Kong coming top.


In January 2011 Cathay Pacific became the first airline in the world to achieve 100% e-AWB at its Hong Kong base. At the time, the airline’s cargo director, Nick Rhodes, said the milestone could not have been achieved “without the great support of agents and forwarders in Hong Kong”.


Indeed, Hill says the Hong Kong airport community has been leading the charge on e-AWB, noting that the system works best when airport communities work together, something that Amsterdam and Dubai have also done, all putting out a clear message that says: ‘Send freight through this hub; we make it easier and faster.’  


While additional initiatives such as eAWB360 are being introduced to smooth the path to a paperless future, ultimately the ball is in the industry’s court when it comes to making e-freight a more widespread reality, as Tyler points out: “Some other additional tools are on the way to assist carriers and forwarders, but in the end, this will come down to the industry’s willingness to change.”


One air freight operator that has spearheaded the move to e-freight, and is playing an active role in the eAWB360 campaign, is Lufthansa Cargo. The German carrier has successfully rolled out the e-AWB worldwide at more than 130 stations. “This has been done because we are convinced that it is the future”, says Lufthansa Cargo Programme Manager for e-Cargo, Boris Hueske, adding “we hope to encourage more to start this journey.”


However, Hueske admits that this encouragement is often met with reluctance from other operators to engage in the initiative. “Above all, man is a creature of habit,” he says. “Many are still used to print, but this is not the future, it’s the past. Furthermore, a lack of IT investment and a sub-optimal focus on data quality often diminish the visibility of the benefits. Those data quality issues can only be resolved by investing in IT and modern messaging technologies.”


A new messaging standard is available in the form of Cargo-XML, but it will take time for its adoption to catch on, given the legacy of the well-known and long-running standard it seeks to replace.


“The content [for Cargo-XML] far exceeds the capability of what has been the messaging standard for the last 40 years. Content is more comprehensive, but it takes time for that level of detail to be adopted across the whole industry,” says Hill. “There are still not enough people or organisations that have adopted this standard to do effective testing.”  >>

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