Air Transport
Air Transport
Air Transport
Air cargo logistics means using aircraft and warehousing services for the
transport of goods quickly from point of origin to point of consumption for
satisfying the requirements of customers. Air cargo is used mostly for shipping
goods that are highly valuable, time-sensitive and perishable. Globally, more
than one third of the value of goods traded internationally is transported by air
and therefore air cargo industry is considered as a barometer of global
economic health. It is the fastest mode of transport and offers benefits of
secure handling, speed and geographical and temporal flexibility. But it is
relatively expensive. One kilogram costs average six times than ocean container
freight. That high cost is compensated by reduced inventory and warehousing
costs.
Advantages of Air Transportation
Speed and Frequency :
The most important factors that a customer will consider are no doubt speed
and frequency, especially if he has some urgent shipments. The delivery to
certain areas may take several weeks to arrive by ocean and land freight. Time
sensitive or perishable goods, such as fresh seafood and flowers, often rely on
the air freight.
Reliability :
Owing to the high cost of the airport facilities, these comes a need for maximum
utility. As such, the arrival and departure times of flights are highly reliable.
Warehousing :
Using air cargo, the customer has less need for local warehousing and expensive
stocks.
Advantages of Air Transportation
Financial Constraints :
As air cargo is much more faster than surface or sea transportation, it can free
the capital which would otherwise be tied up in the long transit time for the
goods to arrive at the buyer’s premises before the payment can be realized by
the seller.
Insurance Coverage:
More and more users of air cargo services are going for a package of services. In
view of this, the carriers have always provided for insurance coverage on their
own where one may declare a “value for carriage” and then a premium is levied
by the carrier in case of eventualities occurring while the goods are in transit to
the final destination. Nowadays, many air cargo agents have also undertaken the
role of an insurance agent and provides coverage for marine and liabilities risks.
Insurance Premium :
The insurance premium are lower for air cargo as the transportation time for air
cargo is comparatively short. Further, the airports are considered high security
areas, thus the lower premiums.
Advantages of Air Transportation
Less Packing Required:
As the security conditions at airports are good, aircrafts requires delicate
handling during loading and unloading, less packing materials are required
when goods are transported by air. This brings about savings for the user in
terms of costs as well as time to provide services for the additional packing.
Door to Door Delivery As there are many landlocked countries, such as Nepal,
Laos, Switzerland, Austria, Mali and many more in the former Soviet sub-
continent, air transportation has provided new access into these countries for
international trade. The air cargo agents also provide door delivery service for
those customers that may require them.
➢ Usually airports are located outside the cities, so road transport has to be arranged to
carry the goods to and from the airport. This results in higher costs and wastage of time.
Air cargo logistics means using aircraft and warehousing services for the
transport of goods quickly from point of origin to point of consumption for
satisfying the requirements of customers. Air cargo is used mostly for shipping
goods that are highly valuable, time-sensitive and perishable. Globally, more
than one third of the value of goods traded internationally is transported by air
and therefore air cargo industry is considered as a barometer of global
economic health. It is the fastest mode of transport and offers benefits of
secure handling, speed and geographical and temporal flexibility. But it is
relatively expensive. One kilogram costs average six times than ocean container
freight. That high cost is compensated by reduced inventory and warehousing
costs.
Air Cargo Logistics Process
Air cargo logistics process is a time- definite endeavour that requires the
coordination of multiple parties, namely shippers, freight forwarders,
carriers, customs, warehousing agents, ground handlers and consignees. The
processes of moving cargo from its origin to destination are given below:-
Progress ofLogistics
Air Cargo RailwaysProcess
in India:
From the above picture it is clear that the following parties are involved in air
cargo supply chain and all are crucial to the efficiency of the air cargo process.
a) Shipper/Consignor: The person or firm who requests the service in
transporting the cargo through air.
b) Freight Forwarders: Freight Forwarders are air cargo agents they typically
purchase transport capacity from carriers in bulk and sell it to their shipper.
They are also called Third Party Logistics (3PL) service providers.
c) Carrier: The firm which provides the service of air delivery of cargo from the
origin airport to the destination airport. There are two type of carrier: all
cargo carrier and combination carrier. Carrier that is exclusively for freight is
Factors AffLogistics
Air Cargo ecti ng Process
Railways
called all cargo carriers and the carrier that carries both passenger
and cargo that is stored in the bellies of aircraft is called
combination carrier.
1) The shipper sends request to the forwarder and the forwarder arranges
transportations for the shipper
3) When the exportation is permitted, the customs broker does customs clearance. In
case of clearing and forwarding agents, both cargo spaces booking and customs
clearance done by this agents.
4) The shipper moves cargo to the airport waiting for loading. In case of import cargo
the process is 1) when airlines moves cargo to the destination country and unloads
the cargo. 2) Customs broker does customs declaration, and move cargo to consignee
when import is permitted.
REGULATORY BODIES IN AIR LOGISTICS
1) Demand:
Demand affects the prices of each good. The more consumers want
to get a certain service, the higher the price is going to be. This is
the main principle of economics. When the demand for specific
shipping services rises, the air freight rates rise with it.
2) The Containers :
The transportation containers (known as the unit load devices) are
engineered to protect the cargo from damages caused by the trip.
Various items require different types of containers. If shippers are
looking for a specific container to protect their things, it could add a
bit more to air freight rate than what they expect. The containers used
in an air freight service are usually suitable for different types of
cargo. This means that the type of item they transport will influence
the air freight prices. If they want to include extra security measures
to protect their freight, then the cost of air freight service will be
higher. This is often applicable to transporting of livestock, pets or
works of art.
3) Manpower:
The amount and specialization of people required to ship the items will
also influence the air freight rate. This means that the form of service
need will change the air freight rate. In some cases if goods to be
handled by professionals that will take care of it, then they might need
to pay extra money. Manpower also involves different people who will
deal with the paperwork of freight. It will take the expertise of more
than one expert to make sure that your freight is in good condition.
4) Speed :
The factor is second only to demand on its effects on the air freight rate. It is
often the case that firms have different air freight rates grounded on the
speed by which they can deliver the goods. There are companies which offer
faster delivery services for extra charges. There are companies that can
deliver goods in 1 day, and the number of companies that can even deliver
items within a couple of hours. The speed of delivery is very important
characteristic because very often it’s the main reason why people choose air
freight services.
5. Competitors Rate:
Some time due to competition in the air cargo segment the freight rates are
differently charged. It all depends upon the number of players in the market,
the rate for which the services offered etc., is always taken into consideration
6. Variatns:
Available in Air Shipment When a person needs the service of shipping
for much lager and much heavier things, he (she) might want to look
into the variants covered by the freight shipments.
8. Services Available:
Depending on the available service variants, prices and type of delivery
may vary including the duration of travel. The majority of items in this
category travels certain expanse through air and may go coast to coast
in some days or overnight.