Chip producer slates airlines’ service record

“Terrible” service and poor communication is preventing the air freight industry from speeding up door-to-door delivery, semiconductor manufacturer ASML complained at today’s opening session of the Air Cargo Forum in Seoul, South Korea.
There has been much debate between airlines, airports, cargo handlers and freight forwarders about how to meet IATA’s objective of removing 48 hours from the typical end-to-end supply chain, which is claimed to have remained stubbornly stuck at six days for the last 40 years.
Enno Osinga, senior VP cargo at Amsterdam’s Schiphol Airport, commented that IATA represents only airlines – “so unless its airline members can find ways of flying faster, they are relying on the rest of the chain”.
Eric Vennekens, director of trade and infrastructure at ASML, said: “Cooperation along a huge supply chain will bring you, perhaps not 48 hours but will save time and improve efficiency for us in the semiconductor industry.
“We understand that only 60 to 70 per cent of cargo flies as planned. I would rather pay a few cents more for [a guarantee of] flown as planned rather than guess what’s going to arrive. You can’t plan your operations around 60-70 per cent – that’s terrible. We hear an hour, or one and a half hours, after the plane landed that ‘sorry, your cargo didn’t fly’.”
The company has calculated that it loses 25 to 30 euros for every second its products are not moving.
“As a shipper, the key is transparency, reliability and flexibility,” Vennekens said. “It’s good for the industry to join forces and work together as a total supply chain. But if you keep building walls, it doesn’t happen.”
Osinga said all stakeholders from freight forwarders to handlers and truckers, recognised the need to avoid unnecessary delay, but tended to “focus on their own self interest”. He was pleased that the World Customs Organization had committed to applying consistent standards.
“Global data needs one single standard. “We need an integrated system so that everything done in each location is transparent and we can slowly try to achieve what the integrators have achieved over many years.”
Jos Nuitjen, VP network integration strategy for Descartes Systems, said: “To collaborate you need information, and that means information to all parties. Regulatory pressure is a good thing because they’re forcing the industry to collaborate better and get information there before the goods are there.”
The industry’s continuing reliance on paper documents on paper was the problem, Nuitjen insisted. “Get rid of it! There will be a difficult period for a couple months but it will help get information to all parties.
Jaedong Eum, Korean Air Lines’ VP cargo marketing, while defending his company’s 96 per cent. Flown-as-planned performance, said: “Paperless is very important and we’re trying very hard. Technologically we have been ready for a year, but there are still many obstacles.
“Our biggest market, China, is not ready. This is not issue airlines alone can solve,” Eum said.
There was not a single forwarder who didn’t look at the supply chain from end to end, said Essa Al-Saleh, CEO and president of integrated global logistics at Agility. “But the economic reality today is that many shippers procure through global tenders based on specific trade lanes, not the whole supply chain. This dynamic gets in the way of a long-term solution.”
The integrators had avoided this by adopting a fixed, standardised model, Al-Saleh added.
Osinga agreed that the integrated model was the benchmark. “But there’s a significant difference between what you pay an integrator and for general cargo. Can you ever get this level of reliability for just a few cents more, and still keep our industry competitive?” If that was no possible, he concluded, “It’s a great debate but it’s not going to happen.”