[110118.EN.BIZ] Digitalisation, New Technologies, Data Sharing Platforms Are Changing Air Cargo Sector

THE air cargo industry has seen many changes over the past decade. New business models and ideas are now emerging in the new era of digitalisation and big data. Beyond digitalisation, drones, connected unit load devices (ULDs) and data sharing platforms are becoming game changers for the air cargo industry.

The logistics and air cargo industry are and will be transformed, modernised and disrupted by digital technologies. These newer forms of technologies are expected to revolutionise the entire ecosystem, according to the International Air Transport Association's (IATA) head of digital transformation Celine Hourcade, reports Mumbia's STAT Trade Times.

"Electronic messaging, smart data sharing platforms, blockchain technologies will simplify and change the flow of information between the stakeholders. Internet of things, connected devices, augmented reality, artificial intelligence will help to make the physical flow of goods more efficient, safer and easier.

"Big data collected from all sources will contribute to safety programmes, optimisation projects, more predictability and better transparency. Virtual reality will support better training," Ms Hourcade believes.

Furthermore, IATA with its members have identified the need to accelerate the adoption of data sharing technologies at an industry scale and is launching the ONE Record initiative. This aims to develop standards for data sharing by defining data semantic dictionaries that allow all parties in the logistics and transport chain to exchange data with common understanding of the meaning of that data.

A second component in the ONE Record initiative is to agree on standards for data connectivity. This concerns the development of standards for application programming interfaces (APIs) for systems.

The report highlighted some other game changers that have already made their mark in the air cargo industry.

Last year Freightos launched an online marketplace for international freight. The Freightos marketplace offers users instant comparison of freight services and prices from multiple logistics providers, thus enabling users to establish "the optimal and cheapest method" for moving their shipments.

Frankfurt Airport's "FAIR@Link" cargo community system, launched in 2015, allows users to exchange shipment data between companies across its online platform. Freight forwarders, cargo handlers and customs are also connected to the system. This creates simplified interfaces and improved processes.

Drones will soon take a big slice of the air cargo sector with a variety of applications including the delivery of goods and disaster recovery efforts. Africa is already leading the way in terms of drone usage. Rwanda, Tanzania, South Africa, Malawi and Lesotho are already using drones to deliver medicine to inaccessible rural communities.

Drones are also becoming a popular option for e-commerce players such as Amazon, Walmart and Alibaba. Drone are also already being used by postal operators in France, Switzerland, Spain, Singapore, Australia, Ukraine and Germany.

The rapid growth of ecommerce has fuelled the demand for smart ULDs. Major players such as Jettainer, Unilode and ACL Airshop have already ventured into the smart ULDs space. These "smart" containers not only speed up maintenance and control procedures, but also increase the level of transparency of the ULD's journey, making it easier to determine responsible parties for any damage that occurs in transit.

Blockchain can change the interaction between business partners. "It offers the chance to improve security, transparency and reduce interaction cost. If every partner always knows where a good is, how it has been handled and by whom, we suddenly have a totally different way of cooperating with each other," said Fraport senior vice president of cargo Felix Kreutel.

A number of airlines and their IT partners are developing use cases for blockchain in air freight. Some of them focus on creating reliable tracking and audit systems of the origin of goods and the status of these goods as they are proceed through logistics and transport chains.

Other initiatives focus on trade and transport finance and aim to use blockchain to manage the financial transactions from shipper to consignee via the logistics and transport providers with the involvement of banks and freight insurance. These use smart contracts to automate the financial transactions and payments.

While the industry is slowly and steadily embracing new technologies to improve its processes, the unwillingness of single players to cooperate may stick out like a sore thumb. Also, while automisation and new technology-related investments are being talked about, the current environment is all about rates and margins, hence everyone is just looking for ways to reduce costs.

Many innovations make it necessary that processes are aligned, so the industry needs to work together and exchange data. New technologies are of no use if they are not commonly adopted.

Source : HKSG.