Without a doubt, one of the biggest issues facing the air cargo sector right now is the pending implementation of 100 percent screening for all cargo carried on passenger planes, which takes effect in August. The requirement to screen 50 percent of the affected cargo has been in place since February 2009, but it’s the remaining 50 percent that has shippers and carriers worried that delays will be inevitable.

“We need to work with the forwarders and shippers to make sure that we are ready,” acknowledges Joe Reedy, Vice President, Cargo Sales and Marketing for American Airlines. “AA Cargo has invested millions of dollars into equipment to ease the transition to 100 percent screening for our customers. We also have been working hand-in-hand with the Transportation Security Administration (TSA), as well as other carriers and industry organizations, to create industry-wide programs in the hopes of providing a more seamless transition.”

One such program is the Certified Cargo Screening Program (CCSP), which has operated as a pilot program since February 2009. The program allows Certified Cargo Screening Facilities (CCSFs) to screen cargo offsite and transport it to the airport securely without the need for re-screening.

“There are distinct advantages to participating in the CCSP, especially for certain industries,” notes Reedy. “Take pharmaceuticals, for example. CCSP allows these companies to manage the screening process at their own facilities and bypass additional inspections by airlines at the airports. Not only is it critical that medicines not be delayed in delivery, it is also critical to manufacturers that product not be opened or tampered with after leaving their facility.”

According to the TSA, certain industry entities may apply to the agency to become a Certified Cargo Screening Facility. The process involves carrying out a TSA-approved security program and adhering to strict chain-of-custody requirements to secure cargo from the time it is screened until it is loaded onto a passenger aircraft. CCSF applicants must implement a multi-layered security program that includes appointing security coordinators, strict access controls, and vetting of key personnel. From there, the TSA conducts routine inspections to determine whether CCSFs are complying with requirements.

While air cargo executives speculate about the pending impact of the cargo screening rule, what is known is that the industry as a whole is in the midst of intense change and there’s pressure to adapt quickly to the new marketplace dynamics.

“The outlook for our industry remains difficult this year and recovery will likely track with the global economy,” explains Reedy. “In response, industry leaders are addressing these market challenges and turning to markets that still show promise—such as perishables and pharmaceuticals.” In fact, growth in the pharmaceutical sector has been “robust,” says Reedy, “with global market value of the flow of trade expected to exceed $975 billion by 2013. Carriers quickly have developed products and solutions to serve this growing market. Our Expedite TC cold-chain solution, which is QEP certified by Envirotainer in 60 cities, successfully launched last year and offers customers a fail-safe process.”

At the same time, AA Cargo is continuing to expand its global network, says Reedy. “We will be launching Chicago to Beijing in April to help meet the growing needs of our Asian customers and expand their possibilities for an Asia to South America market. By adding a daily B777 service to Beijing and tapping into our global network, we can extend our customers’ reach into Sao Paulo.”

Less fuel burn equals more green

Meanwhile, another fast-moving development among air cargo carriers is the focus on implementing more sustainable operations, and obviously, better fuel management is one area that’s getting a lot of attention.

“Fuel burn represents a big opportunity for us to decrease our greenhouse gas emissions,” says Wally Devereaux, Director of Sales, Marketing, and Revenue Management for Southwest Airlines Cargo. “We have several different initiatives underway currently to try and reduce fuel burn.”

Devereaux says the carrier has committed $175 million over six years to retrofit its fleet with Required Navigation Performance (RNP) avionics, which provides more efficient flight paths from origin to destination while simultaneously burning less fuel. RNP is satellite-based navigation and is one of the cornerstones of the Federal Aviation Administration’s Next Generation Air Traffic Control system. “We’re estimating that we’ll save a minimum of 6 percent in fuel burn on an annual basis,” he says. “And, if you look at our fuel burn from 2008 and then look at our estimates with this program, we would have saved 90 million gallons of jet fuel and would have reduced our carbon footprint significantly in the process.”

Southwest is also one of the few airlines that has adopted an engine-washing program to improve fuel efficiency, explains Marilee McInnis, spokesperson for the carrier. “We wash four engines each night, in Oakland and Orlando, because those are two of our larger stations and we have a lot of planes on the ground,” she says. Although the technology has been available for some time, Southwest’s commitment to truly ‘green’ practices prevented them from using it early on because it created unacceptable levels of chemical runoff. However, now the process uses a closed-loop system with pure, atomized water that avoids contaminant runoff, explains McInnis. In addition, the engine-washing process takes place at the ramp so there’s no need to tow the plane to a remote location, which also means less energy and time expended in the procedure. The entire process takes about 90 minutes and can reduce an aircraft’s fuel burn by as much as 1.2 percent and decrease engine exhaust gas temperature by as much as 59 degrees Fahrenheit.

Southwest has also opted to use electricity at the gates rather than burning fuel in auxiliary power units (APUs) to enhance its environmental initiatives.

The carrier is continually looking at ways to become more environmentally friendly, and is currently testing a ‘green’ plane that’s been outfitted with new, lighter-weight seat covers, seat fill, and new life vest pouches, all of which will reduce the weight by about 5 pounds per seat, says McInnis. “When you have 137 seats on board multiplied by the number of aircraft we fly, there’s a huge potential there to save a lot of fuel and emissions,” she says. “And, all of the items we’re testing are eco-friendly beginning with the manufacturing process and they’re fully recyclable.”

Similar to other carriers, Southwest remains cautious but hopeful about the industry’s future. “Last year was tough, but it’s stabilizing,” says Devereaux. Nonetheless, the carrier is expanding to meet market demands, including the addition last year of cargo service into Canada with partner WestJet, Canada’s second-largest air carrier. The service covers U.S. exports into Canada, but future plans call for expanding the service to include imports into the U.S.

As for the domestic market, Southwest will continue to expand in key markets like Denver and St. Louis, says Devereaux, and will also be the first carrier to serve the Panama City, Florida airport, starting in May. wt