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Cargo

Crises draw airlines and forwarders

Airlines are increasingly looking at how they can cater for demand for time-critical transportation of everything from medical supplies to spare parts – a lucrative business, as Ian Putzger finds out
 

There was strong demand for ad hoc charters last year, and 2017 looks to be off to an even stronger start, reports Dan Morgan-Evans, Global Cargo Director of Air Charter Service.

 

Airlines are now sensing opportunities in the emergency logistics arena. Freighter operators no longer shun charter opportunities – and may even regard them as strategic planks of their business. Belly carriers are leveraging their networks and frequency of flights to eat into the market where scheduled operations can play a role – at a significant discount compared to charters.

 

Delta Cargo has set its sights on shipments that require better solutions than express. At the beginning of March the US carrier launched DASH Critical & Medical, a premium service for small time-sensitive shipments of up to 100lb like urgent medical traffic, spare parts for stricken aircraft and machinery, and legal documents. Backed with GPS tracking and a 100% money-back guarantee for delays in excess of 45 minutes, the new offering can be booked online and tendered up to 45 minutes prior to flight departure. Shipments are monitored end-to-end by a dedicated team.

 

At this point Delta’s new service is live in the US domestic arena only (from 10 origin points), but management has stated that it intends to take it into the international sphere before the end of the year.

 

“We’ve tailored and developed this product around our customer needs with the highest boarding priority of any Delta Cargo product, and the fastest transit times in the logistics industry. No one else offers a comparable service,” declares Gareth Joyce, Delta Cargo’s Senior Vice President.

 

Delta is the latest carrier to mount a foray into the time-critical segment. In the spring of last year, Qatar Airways launched a product targeting this market which features top boarding priority, short and flexible close-outs, quick and dedicated ramp transfers and retrieval within 90 minutes arrival. IAG Cargo joined the race in September with ‘Critical’, a premium offering with shorter windows for tender, transfers and retrieval, and top boarding priority. According to Daniel Johnson, Manager Global Products, it was exclusively designed for urgent shipments that often have significant cost implications if they do not arrive in time.

 

The rush to time-definite services promises juicy yields at a time when margins in the cargo industry are under severe pressure, despite mothballing of freighters and other efforts to trim costs. Moreover, the time-critical business has shown strong growth. Within 10 years, revenues for specialist provider time:matters climbed 300%. Franz-Joseph Miller, Managing Director of the company, expects growth of 8-10% this year – a far cry from the trajectory of general cargo.

 

The automotive industry has been a major driver of growth in the emergency and time-critical business. Charter broker firm Air Partner has arranged a lot of moves for this segment, with much of the spare parts traveling from Eastern and Central Europe to markets like Spain and the UK, but also full 747 charter to Brazil, reports Mike Hill, Director Group Freight.

 

IAG’s Critical service has found takers across a broad spectrum of users, says Johnson, adding that it has encountered particularly strong resonance in the high-tech, aerospace and automotive segments.

 

He has also noted growing interest in the oil and gas industry, an observation shared by Morgan-Evans: “I would not say it’s a resurgence in the oil and gas sector at this point, but requests are up, flight numbers are up,” he remarks.

 

In response to a need for time-critical service from a range of industries – from aerospace and energy to manufacturing – DHL Global Forwarding unveiled a bespoke service last autumn. Its ‘SameDay Speedline’ is marketed as a “mission-critical solution for emergency shipments”. So-called ‘contact centres’ in the US, Singapore and Dublin monitor these shipments door-to-door. DHL promises quotes within one hour of an enquiry and collection of shipments within two hours. >>


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