When Will eAWB/eFreight Come of Age?

March 29, 2016

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It was over 100 years ago when the first mail was delivered by plane. Since then, planes have been commonplace around the world for mail and parcel deliveries. Although the planes have evolved to be bigger and faster, some organizations are slow to replace their cargo planes.

MEMPHIS, Tenn., June 1, 2015 … “FedEx Corp. (NYSE: FDX) announced today it has permanently retired 15 aircraft and 21 related engines as it continues to rationalize capacity and modernize its aircraft fleet to more effectively serve FedEx Express customers”. These were DC10 MD built in the 70’s.

So companies are clearly investing in aircraft as they look to increase efficiency and reduce operational costs. Perhaps the investment is necessary in order to prepare for the massive growth in e-Commerce. E-Commerce is seen as a huge opportunity for the air cargo industry. The graph below depicts the growth of e-Commerce.

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Even with the growth in e-Commerce and the upgrades of carrier fleets, air cargo still heavily relies on paper documentation for the exchange of information related to air cargo. The industry loves paper and simply does not want to let go. Typically, international airfreight shipment is accompanied by over 30 different paper documents belonging to different members of the supply chain, including: Shippers, Post Offices, Freight Forwards, Airlines and Consignees.

With eAWB global penetration a little over 36% at the end of 2015, and a target of 56% by the end of 2016, it is going to take some time to get full penetration. The status quo is not the way. New technologies need to be sort so as to enable small and medium forwarders and carriers, as well as complementing existing systems; all in an effort to provide greater future capability, flexibility and speed. Look at how the passenger sector has evolved along with other industries.

E-Commerce is driving change and e-Commerce companies are using these technologies. Logistics companies are waking up.

The eBook below talks about the progress to date across the industry, some of the challenges, how price for data exchange is affecting business and the disruptive technologies that could potentially shake up the way eAWB/eFreight documents are send or received, saving huge money for all.

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