Estimating Truck Trip Generation for Airport Air Cargo Activity (2017)

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5 chapter two Description of Air cArgo system components Air freight is transported in dedicated cargo aircraft and in the cargo space of passenger aircraft (belly cargo). As with passenger baggage handling, cargo on narrow-body and smaller aircraft is loaded individually, whereas cargo on widebody aircraft is usually containerized. International cargo arriving as imports may have been pre-cleared electronically or may be subject to additional inspection by regulators before being cleared to leave the airport. Perhaps one of the most unique attributes of the air cargo industry is the rapid loading and unloading of commodities onto widebody and narrow- body freighter aircraft by means of unit load devices (ULDs), including pallets and containers. Cargo aircraft have large doors and rollers fastened to the deck of the aircraft. These aircraft allow containers and pallets laden with freight and mail to be rolled on and off either manually or through a mechanized system. types of cArgo cArriAge As shown in Table 1, there are four primary air cargo transport business models that affect airport facility planning. These are passenger airlines/combination carriers, all-cargo carriers, integrated express carriers, and freight forwarders. passenger Airlines and combination carriers A passenger airline provides cargo services to the industry by offering for sale the capacity of the “belly” compartment of its aircraft that is available after the passenger-related items such as food/ beverages, company material, and passenger luggage are loaded. These airlines can provide the industry with air cargo transport flexibility in the form of frequent flights to destinations. Passenger airlines generally provide airport-to-airport service, with freight and mail carried as belly cargo. Airlines usually offer belly cargo space “as available,” because priority goes to passengers and their luggage. These airlines may also be known as combination carriers, which are scheduled air carriers that transport both passengers and cargo in passenger-configured aircraft, with cargo restricted to the lower deck compartments. All-cargo carriers All-cargo carriers operate airport-to-airport air cargo and freight services for their customers but do not offer passenger service. All-cargo carriers offer scheduled service to major markets throughout the world using widebody or containerized cargo aircraft. Major air cargo carriers operating in North America include Polar Air Cargo and Kalitta Air. integrated express carriers Integrated express operators move the customer’s goods door-to-door, providing shipment collec- tion, transport by air or truck, and delivery. Dominant integrated express operators in North America include FedEx, UPS, and DHL. (DHL’s U.S. domestic pickup and delivery service was discontin- ued in January 2009.) Express companies provide next-day and deferred, time-definite delivery of documents and small packages (up to 70 pounds). Integrated express operators are increasingly transporting heavy freight (more than 70 pounds), which is the next logical step in leveraging the

6 unique scale of operations, network, and other resources that operators can bring to each business sector (Maynard 2015). freight forwarders A freight forwarder is a firm that receives, stores, and/or ships goods on behalf of other companies. It usually provides a range of services including tracking inland transportation, preparation of ship- ping and export documents, warehousing, booking cargo space, negotiating freight charges, freight consolidation, cargo insurance, and filing of insurance claims. Freight forwarders usually ship under their own bills of lading or air waybills; their agents or associates at the destination (overseas freight forwarders) provide document delivery, deconsolidation, and freight collection services (Business Dictionary 2016). UPS Supply Chain Solutions (part of UPS, Inc.) and SPO Logistics are the two largest freight forwarding firms in the United States (Transport Topics 2016). types of Airport Air cArgo fAcilities The consolidation of the domestic air cargo industry in recent years has precipitated a situation in which air cargo facilities at many airports no longer have a wide customer base, as more freight is trucked directly to major air cargo hubs, bypassing smaller, low-volume facilities. This has led to many vacant cargo facilities or space that are not well utilized. For example, the U.S. Postal Service once had airmail sorting facilities at most medium and large airports, but has closed many since 2001 because much of its Express and Priority Mail Service has switched from passenger airlines to con- tract agreements with FedEx and UPS. On the international air cargo front, the passenger gateway airports continue to experience greater tonnage growth than the domestic airports, and more inter- national passenger routes and freighter routes continue to expand into U.S. airports. Figure 1 presents a diagram of a generalized on-airport air cargo facility that provides truck access and parking. Such on-airport cargo terminals are usually multi-tenant. These may be common-user spaces managed by an authorized cargo handler, but, as traffic levels increase, carriers and integrators often want to have their own space. Forwarders/customs agents may occupy a designated storage area or merely place their customers’ consignments in a common area (The World Bank Group 2009). Figure 2 illustrates, in simplified schematic form, the various types of ground movements asso- ciated with air cargo at a major air cargo airport. As shown, cargo may flow between aircraft and numerous facilities, both on and off-airport. Similarly, cargo may flow between these facilities and Type of Carrier Example of Carrier Characteristics Customers Market/ Movement Type of Cargo Combination Carrier Most passenger airlines Baggage hold of passenger aircraft Wholesale businesses, mail, retail Airport-to- airport Mail, freight All-cargo Carrier Polar, Kalitta Air, World Airways* Main deck of all-cargo aircraft Wholesale businesses Airport-to- airport Larger specialized freight Integrated Express Carrier UPS, FedEx Express Main deck of all-cargo aircraft Retail businesses Door-to-door Packages, express Freight Forwarders Panalpina, Forward Air All-cargo and passenger aircraft Wholesale businesses Road feeder service (pickup and delivery) Ocean and air freight pickup and delivery *No longer operating. Source: Air Transport Association and International Air Cargo Association [compiled by the Texas Transportation Institute (TTI)]. TABLE 1 TyPES OF AIr CArGO CArrIErS

FIGURE 1 Simple air cargo facility diagram (Source: Maynard et al. 2015). FIGURE 2 Overview of typical air cargo ground movements at major airport (Source: RSG).

8 customers and suppliers outside of the airport, including shippers and receivers many miles distant (e.g., road feeder services) as well as integrated industrial facilities adjacent to airport property such as the JetPlex Industrial Park at Huntsville, Alabama International Airport. The common charac- teristic shared by all these activities is that they generally involve truck movements, both on-airport and between the airport and external parties. Belly cargo Handling for passenger Airlines Freight on passenger airlines is dropped off at a warehouse at the origination airport by a shipper or shipper’s agency; the freight is then picked up at the destination airport by the customer (or freight forwarder) after arriving on the passenger airline. Inbound belly cargo is unloaded and transported to cargo facilities or from one aircraft to another aircraft, whereas outbound belly cargo is transported from trucks to the cargo terminal and loaded onto the aircraft prior to departure. All-cargo carrier facilities All-cargo airlines (e.g., Polar Air Cargo, Cargolux) typically contract with third-party companies for loading, unloading, and ground-handling of cargo at privately or airport owned warehouse facilities. Typically, the same facility at an airport handles both the belly and all-cargo airlines (e.g., Swissport). integrated express carrier facilities Integrated express operators use a hub-and-spoke transport model, such as that used by passenger airlines. The air cargo hub used for package sorting and aircraft transfer is the backbone of inte- grated express operators. This allows for total product connection to each market in the operator’s system. Each day of operation, flights from around the world arrive at the hub, where packages are unloaded, sorted by destination market, and loaded onto outbound aircraft. Integrators often make heavy use of automated sorting at their hub terminals to achieve desired turnaround times and deliv- ery commitments. regional air cargo carriers operate smaller turboprop aircraft between origin and destination (OD) or local market stations and smaller or more remote cargo markets, typically in support of a larger integrated express cargo operator such as FedEx, UPS, or DHL. Wiggins Airways and Mountain Air Cargo are examples of feeder airlines contracted to both UPS and FedEx. Feeder flights often transport cargo from a smaller market and feed cargo to an awaiting aircraft for the carrier’s hub. Feeder aircraft may also fly directly to a hub.