U.S Airports Ramp Up Competition for Supply Chain Dominance

By Patrick Burnson, Executive Editor
March 25, 2014 - SCMR Editorial

Top U.S. airports are engaged in a fight for a larger share of the challenged U.S. air cargo market, according to JLL’s annual Airport Outlook Report. With world trade growing faster than demand for air cargo, both airports and air carriers face a significant challenge – how can they attract air freight and fend off competition from other cheaper modes of transport such as intermodal and trucks?

“Airport executives are increasingly focused on the bigger picture, specifically the role that their airport and the supporting infrastructure play in making shippers’ supply chains more efficient,” said Rich Thompson, Managing Director of JLL’s Ports Airports and Global Infrastructure (PAGI) group. “The market is not growing as a whole, so they must use every tool they have to stand out, and attract shipping volume.”

Instead of relying on airline revenues for driving growth, airports are focused on leveraging nearby commercial real estate assets and logistics corridors to position themselves as an essential link in the supply chain. In fact, some airports are now seeing more than 60 percent of their revenue derived from non-airline sources.

“There are two factors that could increase global air freight,” said Thompson. “The rapid growth of e-commerce sales to consumers who demand rapid package arrival, and the demand for time-sensitive and high value goods such as food, perishables, biologics and pharmaceuticals.”

Stifel Nicolaus analyst David Ross agrees:

“We certainly see a lot of growth in ‘cold chain,’ as biologics and other health care products are only increasing in demand from every part of the world.  Getting the right product in the right place at the right time can be vital,” he said.



About the Author

image
Patrick Burnson
Executive Editor
Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review magazines and web sites. Patrick is a widely-published writer and editor who has spent most of his career covering international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. You can reach him directly at .(JavaScript must be enabled to view this email address).

Subscribe to Logistics Management magazine

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your
entire logistics operation.
Start your FREE subscription today!

Recent Entries

This legislation takes the same name of a previous bill rolled out in April 2014, which did not make enough traction to be signed into a law, and would replace the current authorization, MA-21, whose most recent continuing extension is set to expire at the end of May.

The wave that heavy e-commerce activity currently rides is not close to crashing anytime all that soon. And with that comes a heightened focus on the logistics-related aspects of e-commerce, specifically on the last-mile side of things.

Conveyors, shuttles and robots were on display, but as with last year's Modex, software is where the action is in today’s materials handling industry.

When assessing areas of risk facing their departments, nearly half (45%) of Chief Procurement Officers named supplier risk as a top concern, according to a new survey by Consero Group.

2014 was a very good year for the Port of New Orleans, and officials there are forecasting an even more robust cargo scenario in 2015.

About the Author

Patrick Burnson, Executive Editor
Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review. Patrick covers international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. Contact Patrick Burnson

Comments

Post a comment
Commenting is not available in this channel entry.