Supplementary ReadingANALYSIS OF ECONOMICS Machinery and high value items such as computers, X-ray machines and similar devices are air freighted routinely together with boats, racing cars, furniture, household goods, foodstuffs, office equipment and many other types of load. Such operations are well known and documented, and the value of air freighting has been enhanced in many ways in the last 15 years, while a number of factors have come into play to alter the direct value of the air freighting operation. The economics of air freighting have been analyzed but in the end it is very often circumstances which affect the issue. As an example, air freight received a major boost through the congestion of seaports, which still prevails in some parts of the world with ships awaiting berth space to unload their cargoes. Such congestion along with poor surface infrastructures, combined with far from satisfactory document processing system have represented good argument for the air freighting of goods. Direct costs of air freighting do not necessarily always compare favorably with surface transport, but the picture is clarified for interested parties that can produce figures on the complete cost of the freighting operation by a surface carrier. Air freight provides the means of getting goods to market faster and therefore quicker receipt of money by the manufacture or supplier, while many kinds of cargo require little packing, and in some cases almost none at all when compared with that required for sea or road journeys. Market reaction to goods or products supplied is also quicker, sometimes leading to a faster call for repeat orders
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EXAMPLES OF WESTERN EXPRESS AND OVERNIGHT PARCELS BUSINESS Federal Express meanwhile has expanded to an almost unbelievable degree, with 110,000 employees and a fleet of 480 aircraft serving 192 countries. The hub of the whole operation still Memphis, Tennessee. There are, however, operational hubs in Chicago, Indianapolis, Los Angeles, Oakland in the US, with international hubs in Anchorage, Paris, London and Tokyo. Frederick Smith, the original founder, remains chairman, president and chief executive officer. There have been many imitators of this type of service in the US. One of these, United Parcels Service, which operates as UPS airlines, claims to have been in the business long before Federal Express in so far as UPS operated an air service on the US west coast from 1929 to 1931. The massive organization which is now UPS Airlines began air operations in 1981 with its own aircraft piloted by outside crews and from February 1988 with its own airline operations proper. The company has a scheduled network of services to 185 countries and territories, and provides next-day and second-day international package and cargo services with a fleet of aircraft numbering over 170. Such operations have become a way of life in the US, with words such as ‘FedEx’ passing into the language as the colloquial term for commissioning transport of an express delivery of documents or similar goods across the world.
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LUFTHANSA CARGO EXPRESS European company Lufthansa established its Lufthansa Cargo Express network at the end of 1992, introducing two new services in 1993 – EuroCargo and Flash. The first is a rapid transport service operating between 65 European destinations, while the Flash brand provides worldwide express carriage from airport to airport. Additionally, the Flash service offers door-to-door delivery of packages throughout western Europe. The Lufthansa Cargo Express operations are based upon the deployment of quick-change Boeing 737 aircraft, which can be converted from passenger to freight aircraft in 75 minutes. Lufthansa’s intentions with the night freighter express service are to develop this operation into one which might generate as much as 30 % of all cargo revenue from express products, and 50 % of all cargo profits. The company has seen the threat by integrators to the traditional air freight business of airlines and freight forwarders, and the Lufthansa express freighter network was the response.
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DHL WORLDWIDE EXPRESS DHL Worldwide Express, founded originally in the US, remains one of the strongest brand names in the sector, signifying prompt and reliable deliveries of packages virtually anywhere in the world. Founded by three partners in 1969 (Dalsye, Hillblom and Lynn = DHL) for the purpose of shuttling bills of lading between Hawaii and San Francisco, the US company is now operated as DHL Airways, based in Cincinnati, Ohio. Like its contemporaries it operates scheduled express cargo and document courier services throughout the US, between 12 hubs and 76 gateways. DHL International is the international division, which operates from 14 international hubs, using the company’s own aircraft and those of other carriers on a contract basis. DHL Air (UK) is a UK-based company jointly owned by DHL Airways and Hunting Cargo Airlines of Britain, and this arm specializes in the overnight delivery of express parcels and mail. As a whole, DHL is said to have a 37 % share of the global international express air market. In 1994 increases in total shipment of 12 % and 6,4 % in revenue were recorded.
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TNT INTERNATIONAL AVIATION SERVICES TNT International Aviation Services is an operator in the express package business. It is the UK-based European arm of the Australian TNT Transport Group. TNT operates an integrated network of overnight scheduled freight services throughout Europe to more than 30 cities, using the services of a number of airlines (Air Foyle, Eurowings, Pan Air Lineas Aereas) to provide means of carriage of its overnight loads. TNT International Aviation Services established a European headquarters in Windsor, England, in 1987. It bought 19 freighter versions of the BAe 146 and operated later on a lease basis by airlines such as those mentioned. The aircraft fleet has also changed in character to accommodate other types, while TNT International has also established an aircraft maintenance operation as separate, revenue-earning division. TNT continues to gain much income from its overnight parcels service, and TNT Express Worldwide is a division which is said to be the largest express carrier in Denmark, with an estimated 2 % share of business in that country. As a part of its development, the company established new premises at Billund Airport in 1992. It has also invested L 6 m in to new depots in England, in south London and in Manchester. Words and word combinations:
EARLY FREIGHT CONVERSIONS It can be said that almost all passenger aircraft in service with the major carriers today can be used for cargo carriage. Other aircraft are specially designed for freighting purposes although they may be derivatives of earlier passenger models, the Boeing-747 F being an example. In civil transport the pure freighter as such hardly exists as an original concept, for the understandable reason that aircraft manufacturers’ production lines would be too small to warrant their creation. The number of aircraft coming off those lines would be too few to make economic sense for manufacturers, who seek whenever possible to achieve high volume production. Aircraft that began their life as pure freighters invariably did so as a result of contract for the military, which is why one of the most successful military freighter aircraft ever built, the Lockheed Hercules, has given considerable benefit to the airline sector, to the degree that some 50 civil Hercules are operated in various parts of the world today. The lack of aircraft particularly suited to the needs of air freighting operators has always been a problem for the air transport community. The number of new aircraft, required for these operators to develop their business, was very small indeed. Inevitably, manufacturers did not respond when the need was shown, and a conversion of a number of DC-4 aircraft to the passenger-car transporting mode gave a brief fillip to this type of service. In the years that folowed, transport aircraft manufacturers became more adaptable and far-sighted, and responded to the need for aircraft suitable for particular tasks. Manufacturers thus turned, with considerable success, to the development of freight versions of passenger models, working ever closer with the users to perfect freight transporting and handling systems. From a tentative approach, manufacturers refined their designs to offer all-freight models, combination passenger/freight aircraft (that is, Combi types), and the convertible freighter and quick-change models (QC), which could be readily converted from a passenger carrying role to that of freighter, sometimes for overnight cargo operations. These aircraft types were invariably fitted with rollerball floors for pallet handling, lash-down load security systems, and interior lifts for raising and lowering unit loads. Accompanying the development of such aircraft was a range of ground support equipment, designed for the surface handling and airport movement of parcel loads, made-up pallets and complete container loads of freight.
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AIRBUS INDUSTRY The Airbus Industry organization, the conglomerate made up of several major European aircraft manufacturers, has done so well since its creation 30 years ago that the company maintains it, is now second in the world to Boeing in terms of output of its civil aircraft range, and aspires to hold 50 % of the aircraft sales market share by the end of the century. Airbus recognized early the strong prospect for serving the air freight industry, and offered a freight version of its original A300 passenger model, known as the C4, carrying up to 45 tones of freight. The standard passenger version was designed to carry 15 tones in the belly holds and met a particular requirement of the air freight industry by being designed to accommodate standard LD-3 type containers. Devised for the industry, these unit load devices, or ULD’s, were another development of the sector. The A300 found a following amongst a number of operators in Europe, both in the convertible version and also the pure freight model, known as the A300F. An improved version of the original A300, the A300-600, was introduced by Airbus Industry in the 1980s. Its freighter version, A300-600F, was offered in 1992 as a new and logical extension of the A300-600 family. The freighter incorporated a large cargo door on the main deck, a reinforced main deck floor, removal of all passenger systems and equipment, and a deletion of cabin windows except those required for maintenance. Three cabin passenger doors were also removed. The main deck was configured to carry a single row of 88-96-125 inch pallets. The lower hold carried standard industry containers and/or pallets as required. The freighter offered a maximum payload capacity of 54.9 tones and a maximum range with this payload of 2,242 statute miles (3,588 km). Its was designed to meet low noise regulations and comply with FAR 36 Stage Three (US Federal Aviation Administration Regulations Part 36) and ICAO Chapter 3 noise requirements which demand the lowest noise level yet for aircraft at airports.
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BOEING COMMERCIAL AIRPLANE GROUP The biggest manufacturer of commercial aircraft in the world, Boeing did well with its 40-tone B707 freighter, but was even better equipped for the long range, heavyweight freighting market with the B747F and its variants, which include the Combi. Based upon a design for the US military in the early 1960s the Boeing 747 airliner was the product of bold and positive forward thinking by a company which was a prime manufacturer in a world where air transport traffic was doubling itself every 5 years. It was launched by Pan American with orders for a fleet in 1996; a surge of orders followed, and then Lufthansa took a gamble in 1971 and ordered a single B747 freighter to augment and expand its freighting activities, particularly on the North Atlantic route. Lufthansa invested some US $40 m in the single aircraft and its associated equipment. With a swing-up nose and a capacity for 10 tones of freight, the B747F was delivered to Lufthansa in 1972 and airline began North Atlantic freight services between Frankfurt and New York at a frequency of 6 scheduled flights a week. The transformation the B747F had on the air freighting industry at the time was evident in a number of ways. The aircraft allowed full and meaningful use of airborne containers for the first time. Lufthansa developed its own fleet of containers for the aircraft together with a range of supporting ground equipment, which had to be more or less specially designed and developed for the operation. Since that time 93 B747F models have been bought by freighting airlines, and most of the major European carriers have come to base their long-haul freighting operations upon the B747. Air France, Sabena, Lufthansa, Alitalia, KLM, SAS, Iberia and Cargolux all bought B747 Freighters or Combi variants at some stage and found good returns from the combined passenger freight version in particular. The next model of the B747F, the B747-400F, was a completely redesigned model of the original ‘Jumbo’ freighter, with a greater payload capability, strengthened wings, improved systems and a stronger undercarriage.
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