riven by a need to cut costs in the harsh fiscal environment of the early 2000s, U.S. forwarders and shippers began moving domestic time-sensitive freight on the ground with increasing frequency. And while the economy may finally be on the mend, industry observers and players say the downturn's impact the domestic U.S. cargo market will be lasting: Trucking is now not just a viable alternative for moving expedited cargo domestically; in many cases, it's the preferred option and better economic times aren't expected to reverse the trend.

"There's been a big rush to (moving expedited freight by truck) in recent years," says Jon Langenfeld, a senior research analyst with Robert W. Baird & Co. "I don't see a rush back, even though the economy is improving. The shift away from air, for the most part, has been permanent."

Ground networks have expanded and reliable, expedited trucking service is being offered by more operators. As a result, a lot of domestic shipments that used to move by air now arrive nearly as quickly and much more inexpensively via truck.

"Maybe (moving freight by ground is) not 'just as fast' as shipping by air, but the shipment is still getting there in a dependable way," says Langenfeld. "Maybe it won't arrive first thing the next morning, but you can rest assured that it will get there by tomorrow afternoon and it'll be a fraction of the cost."

While pricing for both air and ground service fluctuates, Langenfeld cites "pretty representative" figures from a major freight forwarder that starkly highlight the cost difference: a yield per pound of 16 cents to move freight overnight by truck versus a yield per pound of 72 cents to move cargo overnight by air on the same route.

"We've got a lot of shipping people out there that are getting a lot wiser," says trucking company Overnite Transportation's manager of expedited services Brian Whitley. "If they've converted to ground versus air, I think we'll see a continuation of that. In the long term these relationships (between shippers/forwarders and trucking companies) will maintain their level."

Adds Overnite communications director Ira Rosenfeld: "3PLs are using trucks more than they ever have in the past. Major trucking companies that can offer expedited services are taking advantage."

Rosenfeld says trucks may actually get cargo delivered faster than aircraft because trucking companies can avoid the logistical difficulties and delays often encountered at airports.

"We're not grounded by bad weather," he says. "And unless your factory or plant is on airport grounds, we're going to beat (air delivery) because we can deliver it right to the plant. Remember that a package has to be trucked to the airport, then loaded on a plane, flown to another airport, then unloaded on to another truck that actually delivers it. So with straight trucking, you have a lot less handling of the freight."

The shift from air to ground has been "unbelievably dramatic over the last few years," says Ken Daniel, director of Dependable Logistics Services. The Los Angeles-based third party logistics provider gets fewer and fewer calls requesting domestic air cargo service as shippers see ground not only as a cheaper alternative, but often as a more efficient mode for moving domestic freight.

"We used to do a lot more air freight service," says Daniel. "People just didn't realize you could get better service with trucks."

Several key factors have led to the shift, say experts. For one, less-than-truckload operators offer more efficient services than they used to. "LTL carriers' service is a lot quicker," says Daniel. "What used to be 'expedited' is now normal. Back five, 10 years ago, you paid extra to guarantee delivery in three-to-four days. Now that kind of service is just normal. It's expected."

Secondly, the economy, which burned so brightly in the mid-to-late 1990s, slumped in recent years and forced shippers to rethink all expenditures and look for cheaper ways to operate. "Consumers are getting smarter," says Daniel. "We're talking about a 30-50 percent cost savings in moving the cargo by truck instead of air."

Also, major U.S. airlines reduced passenger capacity by as much as 20 percent in the aftermath of September 11 and over the past few years have developed fleet strategies focused heavily on narrow-body aircraft and regional jets. That means less belly space for cargo and less flexibility for forwarders and shippers looking to move cargo on the airlines' domestic networks.

"We've definitely seen an increase in 3PLs using trucks, especially with the cutback of aircraft on some lanes and the use of smaller planes by a lot of airlines," says Jerry Schneller, an executive with Kentucky-based expedited trucking specialist Ameri-line. "As far as using trucks instead of planes, I think the trend is definitely here to stay."

He notes that while the economy may be picking up, aircraft availability is still tight and the security rules for getting cargo aboard commercial planes are getting tougher.

"If you need to fly something overnight from Los Angeles to Atlanta, then obviously you can't truck it. But anything in the 600 mile and under range and we're right there," says Schneller. "There's a definite price advantage to using trucks, that goes without saying, but I think shippers and 3PLs can also rely on our schedule a little bit more than they can depend on the airlines' schedules."

Indeed, trucking companies say they can more easily cater to the needs of shippers and forwarders than airlines can. "Basically, we're telling customers to tell us what their immediate needs are and we'll find a service to meet those needs," says Overnite's Whitley. "It's a lot easier for truckers to react to shippers needs than it is for airlines. Trucks can follow the company and its plants wherever they go."

Adds analyst Langenfeld: "Trucking companies, including integrators FedEx and UPS, have made it so much easier for customers to use ground-based options for shipping and still meet their needs. Ground networks today are in much better shape than they ever have been and dependability is now a main component of trucking operations. (Trucking firms') dependability and next-day type coverage is what has created this permanent shift."