Know your shipper, know what they ship

People in the air cargo industry claim that it is the express sector of the air cargo market that has grown faster and introduced more innovative methods of delivery. They attribute the spike in growth largely to the fast growing e-commerce market which generates huge volumes of cargo which are expected to be delivered under specific time conditions to consumers. However, the e-commerce market has also given rise to a new, and perhaps a biggest, challenge to express operators and airlines. It is the security of shipments coming from “casual” shippers who have no trading relationship either with the express operators or with the airlines.

Commenting on this new phenomenon, Rob Hyslop, vice president for aviation network development in Asia-Pacific for DHL Express, said red flags are being raised. “We got to build a relationship with the shipper to know what the content of the package. We got to know the shipper and know what we are giving it to the carrier,” said Hyslop at the Cargo Fact Asia conference in Hong Kong. “The industry is subject to a huge number of new, casual customers and that is a lot to manage,” he added.

Hyslop went a step further and said it is only a matter of just one untoward incident that would make the access to the belly space of passenger planes that much more difficult. Incidentally, it is the belly space of passenger aircrafts that integrators and airlines use to transport huge volumes of goods ordered over the internet. Large portions of such cargo include electronic goods, most of which contain lithium batteries.

“If there is such an incident it does not matter if it is with some other company or with someone else. The whole industry will be impacted. It will make access to belly space more difficult. Such an event would call for the industry players to make changes in the declaration procedures and even have the cargo check-in early. All these mean that it will have an effect on the customer who wants a cut off time or a specific delivery,” Hyslop said.

The transport of lithium-ion batteries as cargo on passenger aircrafts is common practice, and it has to be undertaken in accordance with the Dangerous Goods Regulations by International Air Transport Association (IATA). “All lithium battery types have to pass strict testing requirements to be allowed onto an aircraft. Clearly, strict regulations and requirements covering packaging and labelling, have to be followed,” said Tony Tyler, director-general and chief executive officer of IATA. Tyler was recently responding to a question on whether passenger aircraft are allowed to carry the lithium-ion batteries as part of cargo in the context of the missing Malaysia Airlines Flight 370 which carried lithium batteries on board.

While there are complex and stringent procedures in place for the testing and handling of lithium ion batteries, there have been two recent freighter crashes which are caused by batteries catching fire. In July, 2011 an Asiana Airlines B747 freighter crashed off Korea, killing its two pilots, after lithium batteries ignited. In the payload were electronic goods, mobile phones, liquid crystal displays, LEDs, the batteries and liquids. And a year earlier in September 2010 a UPS B747-400 freighter reported smoke in the cockpit immediately after takeoff from Dubai and crashed as the pilots attempted to return to the airport.

Interestingly, established shippers with considerably long history of trading with integrators and airlines too find themselves on the wrong side of the law. In February this year, Amazon.com paid a $91,000 civil penalty to the US Department of Transportation’s Federal Aviation Administration (FAA) for violating Department of Transportation Hazardous Materials Regulations. Amazon offered the shipment without the requisite shipping papers or emergency response information, and did not mark, label, or properly package the shipment. The package contained flammable liquid adhesive and was shipped by Federal Express. In another instance FAA has proposed a $325,000 civil penalty against New York based Alfa Chemistry for violating US Department of Transportation Hazardous Materials Regulations. FAA claims that on two separate FedEx cargo flights Alfa Chemistry shipped undeclared hazardous material that Department of Transportation regulations prohibit from being transported either on passenger aircrafts or on freighters.