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

The annualized turnover rate for large truckload carriers in the third quarter rose one percentage point to 97 percent, according to the ATA.

The Pacific Maritime Association (PMA), representing employers at 29 ports, and the International Longshore and Warehouse Union (ILWU), which represents 20,000 dockworkers, have come to a tentative agreement on a key issue in ongoing contract negotiations.

Diesel prices continued their ongoing decline, with the average price per gallon falling 6.7 cents to $2.866 per gallon, according to data issued this week by the Department of Energy’s Energy Information Administration (EIA).

Unlike other shipping companies, the Postal Service is not implementing any new dimensional weight charges with this pricing proposal

Drewry is expecting the recent spate of freight rate volatility to continue.

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.