Environmental Engineering Reference
In-Depth Information
Freight
Currently, an estimated 40 per cent of global trade by value is moving by air. As
logistics operations have become globalized and just-in-time (JIT) supply chains
have required more rapid transport, airfreight volumes have rapidly increased.
Industry forecasts predict that 'belly-hold' freight, traditionally the primary form of
airfreight, will more than treble over the next ten years (Boeing, 2001b).
A significant development in the market has been the expansion of integrated
carriers such as DHL, TNT, UPS and Fedex, who carry 9.2 per cent of the current
global air freight market, and are forecast to grow at a staggering 13 per cent per
annum and to take a global market share of 31 per cent by 2019 (Boeing, 2001b).
For clients, the attractiveness of an integrated carrier is the single company point of
contact for door-to-door global delivery of an ever-widening range of cargo types, to
a majority of places within 48-72 hours, depending upon the distances involved.
In terms of environmental impact, the sustainability of current operations and fore-
cast growth is of concern, particularly in Europe. The integrators' role in just-in-time
networks is predicated on night flights - unpopular with local communities - in
order to achieve close-of-business pick-ups and start-of-business deliveries. Opposi-
tion to night flights has led to a range of local night-time operating restrictions and,
in several cases, outright bans on night flying that threaten the ability of the supply
chain to deliver with the same response times as are currently achieved (Humphreys
et al, 1999).
The traditional 'predict-and-provide' approach to airport capacity no longer seems
acceptable given the lack of public and political support for unconstrained infra-
structure expansion. The questions this raises are: what level of capacity provision is
sustainable from an environmental, economic and social perspective and which seg-
ments of the air transport market should be accommodated?
A
IRLINE
MARKET
LIBERALIZATION
AND
DEREGULATION
Air transport has moved away from being a highly regulated, government-owned
and subsidized mode of travel run as a public utility, towards an industry where eco-
nomic market regulations are being removed. Traditionally, low traffic volumes and
unfavourable aircraft operating economics led governments to subsidize air trans-
port for political and economic ends. Traffic growth and the fall of the cost per seat
kilometre have improved the financial viability of airline operations: since 1994,
International Air Transport Association (IATA) scheduled airlines have made an
operating profit that in 1999 was 4.1 per cent of operating revenues. In response to this,
many state-owned airlines have started to work to commercial objectives: some have
sold shares to the private sector and a few have fully privatized.
The trend towards private-sector airline ownership is global. In the US most of
the major airlines are privately owned and in Europe this includes the non-flag-
carrier airlines and British Airways. By 2001 a number of governments had sold part
of their airline and had announced aspirations to sell further shares. Examples
include South African Airways, Air France, Singapore Airlines, China Airlines, Air
Afrique, Air New Zealand and Kenya Airlines (Doganis, 2001). Many countries
