Air and Maritime Freight

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Table of Contents

Introduction
Common factors
Contrasting factors
Product characteristics
Accessibility on the mode
Capacity
Intermodal capability
Bibliography

Introduction

One logistics problem that many organisations face in today’s competitive environment is the dilemma in choosing the mode of transportation of their goods. In most international logistics operations and some domestic ones, the only practical modes of transport are by using the sea (maritime) or air. This paper attempts to compare and contrast the two modes with reference to the following criteria. They are product characteristics, speed of delivery, accessibility on the mode, cost, capacity, and intermodal capability. The salient common and contrasting factors will be discussed first and then we applied to the criteria mentioned above.

Common factors

For intercontinental (as opposed to international) the only choice available is either maritime freight or air freight facilities. “But shippers usually have only two choices for intercontinental freight: air and maritime.” (World Air Cargo Forecast 2008-2009: World Air Traffic and Maritime Traffic. 2008). Another common factor is that both are engaged in the export of goods and commodities. Both these modes are also integral part of international logistics. In essence, both these are modes of transport. Barring a few exceptions, both modes of transport carry the same commodities.

Contrasting factors

The two most contrasting features among the two mode of transport are speed and cost (economy). The most common argument in favour of airfreight is the speed that it offers. When the goods are perishable in nature or when they are to be sent in a hurry, the only practical mode is sending them by air. But when speed is not of essence, shipping is more favoured. The economies of the transport are also another factor that tilts the balance in favor of shipping. If cost is an important factor in the saleability of goods, shipping will be the cheaper alternative.

Product characteristics

The nature of the product will also feature in the way it is transported. Some products are too big to be handled by air and hence the only option is sea transport. An example would be engineering goods, pre-stressed concrete construction parts. The wing of the Airbus A380 was transported by ship. Bulk is another factor. Commodities like oil which needs to be moved in bulk use tankers as modes of transport. For air cargo, the factor is the high value-to-weight ratio. Luxury watches, precious stones, and jewelry for example are goods that are usually transported by air. “By contrast, coal, grain, ores, and gravel are low value per unit of weight and typically travel by slow, cheap transportation such as rail and water.” (O’Connor 2001, p.156). This includes petroleum also

Speed of delivery: Usually perishable items like food, fruits, and flowers are transported by air. But maritime freight is gaining a market in this segment in the recent past. With better refrigeration facilities, ships can transport goods without them getting damaged or spoilt even if it takes much longer to reach. “Not too long ago perceived as slow and plodding compared to its glamorous airborne rival, recent technologies, and innovations, coupled with concern about carbon footprints and food miles, have lifted the shipping sector to new highs.” (Sea Freight Gets Increasing Attention as Air Freight Concerns Mount. 2007). Even fruits and herbs are now being increasingly transported by sea. The need for emergency delivery, unanticipated shortage of products, and those needing high security will need air transport as a solution. (Kasarda, Appold and Mori 2006).

Accessibility on the mode

One factor that is against maritime freight is that it is only possible where there exists a large tract of water. In other words, it can only be done on oceans and seas. Only countries that have a coastline (and navigable ports) can have access to shipping. Airfreight on the other hand is possible where a flat area large enough to build airports is available. In case of inaccessible areas, using small planes and helicopters for transportation is also an option. In this respect, air freight is much more accessible than maritime freight. An example would be Switzerland which is a land-locked country and has to depend totally on air freight (apart from road and rail) for its logistics.

Capacity

Capacity wise maritime freight is far ahead in front of airfreight. A medium-sized ship can carry nearly 10,000 tonnes of goods while the world’s largest cargo plane the AN 225 can lift only approximately 250 tonnes.

Intermodal capability

Both the modes of transportation need special arrangements for berthing/landing. Ships usually need ports and if they are not available needed to be loaded or unloaded offshore. Airfreight needs runways depending on the size of the aircraft. Intermodal capability is only possible when ports and airports are in close proximity. An example would be the proximity of Schiphol Airport and Rotterdam Port. Another example is the nearness between several airports and seaports in Abu Dhabi. But even with proximity, special equipment and transport will be needed to transfer goods between the two modes.

Bibliography

KASARDA, John. D., APPOLD, Stephen. J., & MORI, Makoto. (2006). The Impact of the Air Cargo Industry on the Global Economy. [online]. UNC: Kenan Flagler Busines School.
O’CONNOR, William. (2001). The Cargo Mix. [online]. An Introduction to Airline Economics. 156. Web.
Sea Freight Gets Increasing Attention as Air Freight Concerns Mount. (2007). [online]. Ghana Fresh Produce News.
World Air Cargo Forecast 2008-2009: World Air Traffic and Maritime Traffic. (2008). [online]. Boeing.

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