Question #2: The Air Cargo Industry
Throughout history, transportation of cargo has been considered the most important facet of all modes of transportation. Even before carrying passengers, aircraft were used to carry mail. This was the beginning of the commercial airline industry. Since then, air cargo has continued to grow and while in today’s age, passenger carriers eclipse cargo, many believe that carrying cargo will become dominant in the 21st century. In order to fully understand how air cargo operates, it is important to understand the three elements that go into air cargo services. These are air mail, air express, and air freight.
Elements of Air Cargo The first element of air cargo is air mail. Air mail was the first air cargo service,
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Ultimately, efforts would be made to create specific air mail routes and under the control of the U.S. Post Office, the air mail industry began to grow. Control was eventually transferred away from the Post Office and given to private contractors where it continued to flourish and eventually give birth to the commercial airline industry. Following the creation of air mail was air express. Air express “refers to small packages that usually have a higher priority of carriage than air freight.” Air express service began in 1927 and was rife with issues throughout its infancy. It wasn’t until 1973 when Frederick Smith began the dedicated carrier Federal Express that air express came to fruition and turned a considerable profit. The final element is air freight. Air freight is defined as “traffic carried in all-cargo aircraft.” In other words, cargo which is …show more content…
Assembly service is when airlines consolidate packages and charge based on the total weight of all pieces. This allows shippers a price break on particularly heavy shipments. Distribution service is similar to assembly service in that it accepts one shipment from the shipper. It differs in that at the destination the airline will split the shipment and deliver to multiple customers from the one shipment. Lastly, pickup and delivery service is when local truckers under contract with the carrier pickup and deliver cargo in the local areas. Additional services which will not be discussed include high value items, dangerous goods, and restricted
Growth of commercial aviation was greatly influenced when the U.S. Air Mail Service was created in the early 1920’s. The Post Office was one of the first to impose aviation regulations. It required its pilots to be tested, pass medical exams and have at least 500 hours of flying experience. The Post Office set up aircraft inspection schedules and preventive maintenance programs for the pilots to have a safe airplane to fly. These early regulatory requirements improved air carrier safety.
The North American transport system is run by several different agencies, each one having its own important part in making it all run smoothly and efficiently . There are also several policies that have been put in place to keep the transportation system working for the good of everyone. The agencies involved keep very good records of all the types of transportation that make up the system, which makes it easy for anyone to be able to see all the different statistics associated with the system. The Freight broker business is another important part of the transportation system, the following paragraphs will tell how all these things work together.
A switch from premium overnight services to lower – margin deferred services and ground delivery services is an advantage to Airborne Express. With existing assets including trucks, tracking systems, regional hubs and sorting facilities, they only need minor initial investments to develop fully these kinds of services. They should use these assets wisely and effectively.
Northwest Airlines is one of the pioneers in the airline transportation industry and is ranked at the fourth largest air carrier in the United States today. The success of the carrier depends on the quality and reliability of the service at a reasonable price. Close competitors force Northwest to innovate their services by increasing efficiency. This essay will try to examine different perspectives in the services needed to successfully complete the company’s objectives. The analysis will explain historical and financial perspectives that may give a better understanding of the current market trend of the organization.
Air travel began in the early 1900s and scheduled flights started in the 1920s (Harris). In the early years, the airline industry competition was nonexistent. The competitive environment changed dramatically over the course of the last century specifically when the industry underwent regulation and then deregulation. The future success of the airline industry depends on the ability to adapt with rapidly changing industry environmental factors.
Federal Express is an express transportation company, founded in 1973 by Frederick W. Smith. During his college years, he recognized that the United States was becoming a service-oriented economy and needed a reliable, overnight delivery service company. In 1965, as a undergraduate at Yale University, Smith wrote a term paper about the passenger route systems used by most airfreight shippers, which he viewed as economically inadequate. He wrote of the need for shippers to have a system designed specifically for airfreight that could accommodate time-sensitive shipments such as medicines, computer parts and electronics.
Air travel is a fast and convenient way to reach a destination. Even if many passengers may complain of missed flights, delays during the holidays, and the number of carry-ons they are allowed to bring onto the plane, air travel is an important part of quick transportation.
The main threats to the industry over the next five years are the rise in price of oil, legislation, the TSA, and labor costs. Each of these threats effect the scheduled air transportation industry not only endangers Delta Airlines but the entire industry. As the price of labor increases for ground operations and pilots this creates a burden on the industry by causing them to spend more to satisfy their labor requirements. The price of fuel increasing leads to the price of fuel to increase, which not only affects a single airline but every airline. With each time that the crude oil price rises the prices associated with the costs of refining the jet fuel as well as transporting it. These costs are distributed to each airline as they use this resource to transport passengers. As new politicians are elected to Congress and new administrators take charge of the FAA new regulations regarding this industry. These regulations affect everything from mergers to the airspace that the airlines operate in as well as what hubs and airports each airline operates out of. These factors are not issues that the industry faces, the TSA, the Transportation Security Administration, creates an unnecessary burden for the passengers attempting to travel from one location to another. The TSA inspections required before a passenger is allowed to board their respective flights allows time for each passenger to become frustrated with the amount of time they have to allot for inspection as well as the invasion of their privacy.
Inbound logistics – Low cost, simple to use cost effective reservations system, ticketless travel, pre-assigned seating, paperless cockpits, search engine optimisation and BlueTurn; for minimising ground time.
Air travel has grown in the past decade. Travel grew strongly for both leisure and business purposes. India will have nearly 800 to 1000 airplanes by 2023, it was estimated by Airbus. In spite of growth between 30 to 50 per cent in Indian aviation industry, losses of approximately 2200 crore is estimated for the current year.
1. Issues 2. American Airlines’ objectives 3. The airline industry 4. Market 5. Consumer needs 6. Brand image 7. Distribution system 8. Pricing 9. Marketing related strategies 10. Assumptions and risks
The transportation & logistics industry is a form of industry that keeps people and products on the move, it includes airlines and airports, shipping companies, logistics service providers and other transportation companies. That’s why it is considered the backbone of modern global supply chains. In a place like the Kingdom of Saudi Arabia that has diverse geography with a dry desert and great temperature extremes and a large area of about 2.1 million square km, a transportation & logistics industry is a necessity. Imagine you need to move from one city to another (of course it will be so hard to cross large areas of empty deserts) you have only two options to transfer from one to another city; the first option is to drive and the second option is to fly and ship your car via a car transport carrier. The harsh climate in Saudi Arabia makes people to prefer using the second option, this cause the market of transport market to enlarge. Albassami International Group is one of the biggest companies established to satisfy those needs. It is considered one of the biggest companies specialized in vehicle transportation in the Middle East. The philosophy of the company is to serve the needs of the clients over the span of thirty two years, throughout which they constantly had an eye to the future by evaluating the most appropriate ways in which to make transporting clients’ vehicles via the best and safest answer. They operate round the clock to serve clients at all times.
In logistic industry, they have been through lots of challenge in worldwide market. As the containerization of the global economy scopes, a phase of development and explanation, ports find themselves inserted in ever changing commercial environment where logistics is the forefront. Thus, this industry reaches a phase of maturity and rationalization due to the process of logistic on land.
The FedEx delivery company, the world's most important courier service, provides a good example of how intermodal transport operates. The FedEx network is built around a single hub airport located on each continent. The American hub is located in Memphis, Tennessee, the Near East one is located in Dubai, and Subic Bay, Philippines acts as the Asian hub and, Roissy, France represent the European hub. These redistribution points act as bridges between international relations. Beside its strategic hub airports web, FedEx is present in more than 325 airports in 212 countries around the world.
Air Mauritius is an airline company with its head office based in Mauritius Islands. Its fleet consist of a medium and long-haul aircraft comprising of 4 Airbus 340-300C and 2 Airbus 340-300E and a short-haul aircraft for inter-island routes comprising of 2 ATR 72-500 as well as an helicopter fleet comprising of 2 Bell Jet Ranger (Discover our fleet, 2015). Air Mauritius is not only about travelling, it also provides services and products in different departments such as cargo and the inflight sales and entertainment services in order to accommodate its customers at its most. The cargo department offers facilities to travel products ranging from seafood, valuables, textile, flowers, vegetables