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Simplifying the business

By John W. McCurry on June 3, 2013

Widespread adoption of E-freight, or E-commerce, or whatever term is used, continues to be viewed as the air cargo industry’s best hope for long-term relevance. It certainly has gotten its share of plenary time during this spring’s circuit of cargo conferences. If passion among industry association leaders counts for anything, the movement has a good chance to succeed.

Keynote speakers at the recent CNS Partnership Conference drove home the point that the industry is at a crossroads. Among them was FedEx COO Michael Ducker who asserted that the industry has structurally changed and it’s a “new normal” rather than a cyclical upheaval.

“The industry has never faced a more critical time,” Des Vertannes, IATA’s global head of cargo, said during a media briefing in Phoenix. “We have complete clarification that the modal shift is not a temporary event; it’s been a consistent activity over the past five or six years. It means we need to do something on the airline side to grow the pie.”

Oliver Evans, cargo chief at Swiss WorldCargo and TIACA’s new chairman, puts it this way, “We have to simplify the business.”

Vertannes and Evans believe the industry’s leaders now have a sense of urgency about air cargo’s challenges. They cite the well-attended CNS conference as an example.

“Change means threats, but it also means opportunity,” Evans said, noting that the conference drew most of the industry’s senior executives. “This tells me that people are noticing that in an environment with many threats, there is also a opportunity work together.”

Said Vertannes,  “Through these conferences, there is a call to action. We need to embrace E-commerce today. It’s not about an aspiration or a vision. We’ve got to do it and do it now.”

Advancing the E-commerce movement will no doubt require greater cooperation between the airlines and freight forwarders. There is an obvious element of tension between the two sets of industry partners, which bubbled to the surface during an E-freight session at the TIACA Annual General Meeting in April when several airline cargo officials expressed their frustrations at the reluctance of elements of the forwarding sector to embrace E-commerce.

Brandon Fried, executive director of the U.S. Airforwarders Association, tackles that issue in his column on p. 54. During the CNS media briefing, Fried acknowledged that there are components of the forwarding industry that aren’t ready for E-commerce and they will have to be gently encouraged.

“Obviously there are components of the forwarding industry that might not be ready and I think they have to be brought into the debate and have to be assisted for various reasons…it’s a lot easier to lure people with a spoonful of sugar than vinegar.”

Air Cargo World is constantly striving to deliver a superior product to its readers. In this issue, we are adding two new departments. Ruwantissa “Tissa” Abeyratne, who recently retired from the International Civil Aviation Organization as its senior legal officer, will be writing a regular column on legal issues facing the airfreight sector. His column can be found on p. 42.

Drewry, the renowned U.K.-based shipping consultancy, will be providing its monthly East-West Freight Price Index. In this issue, we are also including commentary from Drewry research manager Martin Dixon.

We hope you find these additions to be valuable reading.

John W. McCurry is the editor of Air Cargo World.

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