Winds of change blast Alaska's air cargo industry.
Winds Of Change Blast Alaska's Air Cargo air cargo: see aviation. Industry
Although changes in global air routes and the use of new, longer-range aircraft threaten Alaska's air-cargo prominence, new freight-handling roles may be in the offing coming; arriving in the foreseeable future.
visible but not nearby.
See also: Offing Offing .
In the refueling business, location is everything. Although Alaska's two major airports have been benefiting from location for years, airport officials say Anchorage and Fairbanks international airports Fairbanks International Airport (IATA: FAI, ICAO: PAFA, FAA LID: FAI) is a state-owned public-use airport located three miles (5 km) southwest of the central business district of Fairbanks, a city in the Fairbanks North Star Borough of the U.S. already have lost the role of crossroads for international travel and in about six years also will lose leverage in a now-booming international air-cargo market.
In 1990, the number of international passengers using Anchorage International Airport dropped because of increasing use of long-range Boeing 747-400 jets and the opening of Soviet air space. Boeing's cargo version of the 747-400 is expected to be rolling off the Seattle assembly line in 1994, and Alaska airport officials predict that most European and Pacific Rim Pacific Rim, term used to describe the nations bordering the Pacific Ocean and the island countries situated in it. In the post–World War II era, the Pacific Rim has become an increasingly important and interconnected economic region. air-cargo haulers will be using the jets by 1997.
Similar to the plight of a gas station owner who sees business shrink with the completion of an interstate highway that creates new traffic patterns, Alaska airport officials have some sobering decisions to make as the long-range jets take over the airways airways Anatomy The 'pipes'–trachea, bronchi, bronchioles–through which air passes to and from the alveoli. See Small airways. and bypass Alaska as a refueling stop.
"What we can do is diversify. Build up demand -- start pushing warehouse distribution for multinational corporations
Anders Westman, Alaska International Airport System's marketing manager, agrees with Lindsey that the expansion will hinge on Verb 1. hinge on - be contingent on; "The outcomes rides on the results of the election"; "Your grade will depends on your homework"
depend on, depend upon, devolve on, hinge upon, turn on, ride private-sector involvement. "It's my opinion that in order for warehousing to work, Federal Express or UPS (United Parcel Service United Parcel Service, Inc. (NYSE: UPS), commonly referred to as UPS, is the world's largest package delivery company, delivering more than 15 million packages a day to 6.1 million customers in over 200 countries and territories around the world. ) has to take the initiative. We (airport officials) can prime the pump all we want. But I'm convinced international distribution warehouses are the logical next step. When and if we see it, it will come in the next two or three years, to be optimistic op·ti·mist
1. One who usually expects a favorable outcome.
2. A believer in philosophical optimism.
op , and at most within the next five years."
Federal Express, by far the largest air-cargo hauler at the Anchorage International Airport, has had its engineers scout Anchorage for possible locations for an international warehouse system, according to according to
1. As stated or indicated by; on the authority of: according to historians.
2. In keeping with: according to instructions.
3. Brandon Davis Brandon Zarif (born 1979), better known as Brandon Davis, is the grandson of oil magnate Marvin Davis and former heir to his fortune. He has achieved fame in American media through his friendship and lewd behavior with Paris Hilton; he is known for leveling derogatory , the company's public affairs Those public information, command information, and community relations activities directed toward both the external and internal publics with interest in the Department of Defense. Also called PA. See also command information; community relations; public information. spokesman. He says Federal Express has received inquiries from several multinational firms interested in Anchorage as a logistical base to store high-value goods such as electronic parts or medical supplies that would be delivered on demand to locations around the world.
The freight forwarder An individual who, as a regular business, assembles and combines small shipments into one lot and takes the responsibility for the transportation of such property from the place of receipt to the place of destination. and air carrier currently operates a national warehouse distribution center for International Business Machines in Memphis, Tenn., also Federal Express' national hub. Although the air cargo company operates international hubs in Indianapolis, Ind., and Brussels, Belgium, as well, Davis says only Anchorage is being considered as the site of a worldwide distribution center. Location is the reason.
Davis says decisions about the size and function of such a warehouse will be left to the shipper SHIPPER. One who ships or puts goods on board of a vessel, to be carried to another place during her voyage. In general, the shipper is bound to pay for the hire of the vessel, or the freight of the goods. 1 Bouv. Inst. n. 1030. Federal Express would be serving. In Memphis, for example, Federal Express provides IBM (International Business Machines Corporation, Armonk, NY, www.ibm.com) The world's largest computer company. IBM's product lines include the S/390 mainframes (zSeries), AS/400 midrange business systems (iSeries), RS/6000 workstations and servers (pSeries), Intel-based servers (xSeries) with everything from the warehouse itself to a computerized inventory system and logistics personnel.
Lindsey says Anchorage's foreign trade zone provides an advantage for multinational companies wanting to warehouse goods on airport or adjacent private-sector property. Goods shipped into, stored in, or moved out of a foreign trade zone are not subject to custom duties.
An Anchorage duty-free concession that caters to the tastes of international travelers who visit the airport while on stopovers has helped to buoy airport system revenues and keep airport user fees low. Lindsey points out that Duty Free Shoppers Ltd. in recent years has generated about one-third of the airport system's annual revenues. According to Lindsey, the airport receives two and a half times more revenue when a typical 747 international passenger jet lands (about $3,000) than it receives when a 747 cargo jet lands (about $1,200).
Although airport officials had hoped an increase in jet cargo landings would help compensate for the reduced number of passenger jet landings, international cargo landings picked up only 4 percent in calendar year 1990, to 11,700 from 11,207 landings in 1989. A 17 percent decline in the international passenger plane landings at Anchorage International was recorded over the same period, from 6,784 jet landings in 1989 to 5,647 in 1990.
A more accurate indicator of how the air-cargo business is doing at Anchorage International is cargo landed weight or the weight of an aircraft after it leaves the assembly line and before modifications are made to the plane by air-cargo companies. Airport officials say landed weights are more accurate in determining increases and decreases in air cargo because they not only reflect the number of planes landing at the airport in a given year, but also give an indication of the size of those planes.
The total air-cargo landed weight reflects a slight increase of only 1.84 percent from calendar year 1989 to 1990. Although there were significant increases in landed weights posted by some of the major international carriers, those increases were offset by reductions in interstate and intrastate air-cargo landed weights.
Westman says the air-passenger loss most likely will force increased landing fees at the airport soon. But he notes that even if the airport doubles the current 747 landing fee of between $600 and $700, Anchorage's rates would still be low; for example, the landing fee for a 747 at Tokyo's Narita International Airport Narita International Airport (成田国際空港 is 10 times as much.
Fortunes of War. War in the Persian Gulf Persian Gulf, arm of the Arabian Sea, 90,000 sq mi (233,100 sq km), between the Arabian peninsula and Iran, extending c.600 mi (970 km) from the Shatt al Arab delta to the Strait of Hormuz, which links it with the Gulf of Oman. contributed to the slower than expected increase in air cargo. While its competitors showed significant gains in landings at Anchorage International in 1990, Federal Express landed 33 fewer cargo jets at the airport than it did the previous year. Federal Express' Davis says his company was the military's largest supplier of planes, a statement supported by airport system landing statistics.
The most dramatic declines came during the months preceding and during the war -- October 1990 to February 1991. Over those five months, Federal Express landed only 1,457 jets, compared with 1,726 during the same five-month-period a year earlier. Davis says Federal Express was relieved of most of its obligation to Uncle Sam Uncle Sam, name used to designate the U.S. government. The term arose in the War of 1812 and seems at first to have been used derisively by those opposed to the war. Possibly it was an expansion of the letters "U.S. after the war ended. He explains the military no longer needed civilian aircraft because it was not as urgent to return troops and cargo from the Middle East as it was to get them there.
Nonetheless, the war did not prevent Federal Express from more than doubling its landed-weight figure in calendar year 1990 (from 914.7 million pounds in 1989 to 2.2 billion). But airport statisticians Statisticians or people who made notable contributions to the theories of statistics, or related aspects of probability, or machine learning: A to E
Federal Express was not able to meet some of its commercial obligations because of plane deployments, but Davis claims compensation from the military kept the carrier in the black. The air-cargo firm is expected to continue to fly at or above the levels it had before the gulf hostilities.
While Federal Express was ferrying troops and cargo to the Persian Gulf, its chief competitor, United Parcel Service, was more than doubling its landings at Anchorage International. Now the fourth largest air-cargo hauler at the airport, UPS has benefited from a bilateral agreement signed last year by the U.S. and Japanese governments that allows the carrier to land its planes at Narita International.
As a result, UPS landed 992 cargo planes in Anchorage during 1990, more than double the 480 planes landed in 1989. Further, although UPS did send some planes to the gulf, the firm's Anchorage landings soared from 282 in the period from October 1989 to February 1990 to 468 from October 1990 to February 1991. In February alone, UPS landed 101 planes -- the most it had landed in any given month prior to that. UPS also more than doubled its landed weight.
Doug Kuelpman, UPS public affairs director, says his company lost money meeting its obligations to the Civil Reserve Air Fleet A program in which the Department of Defense contracts for the services of specific aircraft, owned by a US entity or citizen, during national emergencies and defense-oriented situations when expanded civil augmentation of military airlift activity is required. during the Persian Gulf crisis. "Anytime you have to revamp re·vamp
tr.v. re·vamped, re·vamp·ing, re·vamps
1. To patch up or restore; renovate.
2. To revise or reconstruct (a manuscript, for example).
3. To vamp (a shoe) anew.
n. your system and restructure, it costs. You just have to work through it. And there were complications." Complications like having to lease planes to make up for the six jets UPS sent to the gulf. Kuelpman says UPS leased planes to meet its obligations to customers, rather than cut back its service.
Kuelpman says there are warehouse distribution centers in UPS' future, but not in Anchorage. Two reasons he cites are the absence of service to Europe out of Anchorage International by UPS and the difficulty in getting landing rights in foreign countries. Kuelpman says his company is now working with a large U.S. firm to set up a national warehouse, similar to the one Federal Express operates for IBM, at UPS headquarters in Louisville, Ky.
Route Rearranging. Last year's Bilateral Air Service Agreement, the reason for UPS' record increases in recent months, also is expected to boost Pacific Rim-based, air-cargo carrier landings, which combined account for nearly half of the air-cargo business at Anchorage International. The bilateral agreement not only opened up landing space in Tokyo for UPS, but also allowed the two major Japanese air cargo carriers Air Cargo Carriers is a cargo airline based in Milwaukee, Wisconsin, USA. It was established in 1986 and operates feeder cargo services for major express carriers in Canada, the Caribbean and the USA. Air Cargo Carriers, Inc. -- Japan Airlines and Nippon Cargo Airlines Nippon Cargo Airlines Company, Limited (日本貨物航空株式会社 -- to land planes at Chicago's O'Hare International Airport O'Hare International Airport is an airport located in Chicago, Illinois, United States, 17 miles (27 km) northwest of the Chicago Loop. It is the largest hub of United Airlines (whose headquarters is in downtown Chicago) and the second-largest hub of American Airlines (after .
Although to date the agreement has permitted Japanese cargo carriers to make stops only in Chicago on their Tokyo-to-New York runs and has not resulted in increased flights, representatives of both carriers say that should change this year. According to Andy Amman, cargo traffic supervisor for Japan Airlines in Anchorage, his company cut back three of its weekly New York New York, state, United States
New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of cargo flights and rerouted them to Chicago. He says, "Looking into the future, we will increase our number of flights refueling at Anchorage by nine flights per week." Those flights could be added before the end of 1991.
The airport system's Lindsey predicts JAL JAL Jalisco (Mexican state)
JAL Jalapa (Guatemala territorial division)
JAL Jump And Link
JAL Japan Airlines Company, Ltd. eventually will contract out a portion of its operations to Evergreen International Airlines
Evergreen International Airlines is a cargo airline based in McMinnville, Oregon, USA. of Portland, Oreg. As part of that operation, she expects "multiple weekly flights" to begin landing at Anchorage. Amman explains the Evergreen arrangement compensates for a shortage of planes and crews.
Evergreen has leased half of the old Flying Tigers Flying Tigers
or American Volunteer Group
Group of U.S. civilian volunteer pilots recruited by Col. Claire Chennault to fight the Japanese in Burma (Myanmar) and China in 1941–42. building near Anchorage International Airport from Federal Express. Federal Express took control of the building, which it leases from the state, in 1989 when the company bought heavy-cargo hauler Flying Tigers.
JAL is second only to Federal Express in the number of air-cargo planes it lands at Anchorage International. In 1990 the Japanese airline recorded 2,618 planes at Anchorage International, down 25 from the year before. Amman says the slight decrease at Anchorage resulted from the company's moving a portion of its operation to Fairbanks during the first quarter of 1990 to avoid airborne ash from the eruptions of Redoubt re·doubt
1. A small, often temporary defensive fortification.
2. A reinforcing earthwork or breastwork within a permanent rampart.
3. A protected place of refuge or defense. Volcano.
Nippon Cargo Airlines increased landings at Anchorage International from 461 in 1989 to 516 in 1990. Chihiro Tamaka, Nippon's Anchorage flight operations manager See datacenter manager. , says his company also plans to increase flights because of the bilateral agreement. Within the year Nippon will have five more cargo flights per week refueling in Anchorage on their way to New York and Chicago.
Korean Air This article or section is written like an .
Please help [ rewrite this article] from a neutral point of view.
Mark blatant advertising for , using . , the third largest air-cargo carrier at Anchorage International, increased landings from 1,874 in 1989 to 2,031 in 1990. As did JAL, Korean Air temporarily moved a portion of its operations to Fairbanks to avoid potential damage from Redoubt's eruptions.
Volcanic ash See under Ashes.
See also: Ash was not the reason Lufthansa decided to move its refueling to Fairbanks for good in 1990. Westman says the German airline, which averaged 30 flights a month at Anchorage International, moved last September to save 220 nautical miles and 40 minutes of air time on its Frankfurt-to-Tokyo route. Westman anticipates, however, that within the next six years Lufthansa and several other foreign-based air carriers may leave Alaska for routes through the Soviet Union.
Both Federal Express' Davis and UPS' Kuelpman say that the long-range cargo jets -- at a cost of about $140 million -- will not handle enough additional cargo to be sound investments for their freight firms. Also to be considered are the millions Federal Express and UPS have spent establishing international hubs at Anchorage International. Further, future routing plans of Federal Express would be affected by an Anchorage warehouse/distribution center -- the concept airport officials are banking on to make up for the loss of international passenger jet revenue and the anticipated loss of foreign air-cargo revenue.
For now at least, both international and domestic air cargo continue to move through Alaska's airports at a record pace. Anchorage International recently saw nearly an 8 percent increase in the maximum gross takeoff weights of planes, from 9.5 billion pounds during the fiscal year starting July 1988 and ending June 1989 to 10.3 billion during the fiscal year ending June 30, 1990. Maximum gross takeoff weights for passenger flights dipped by only 2 percent during the same period, from 9 billion pounds in fiscal year 1989 to 8.8 billion in fiscal year 1990.
Fairbanks International, which formerly used a different record-keeping system, did not separate its maximum gross takeoff weights into cargo and passenger planes in fiscal year 1989. The Interior airport saw its combined figure increase by 0.5 percent, from 1.205 billion pounds in fiscal year 1989 to 1.211 billion pounds in 1990.
As did Anchorage statistics, the Fairbanks combined figure for fiscal year 1990 reflects an increase in cargo flights and a decrease in passenger flights. Fairbanks historically accounts for less than 5 percent of the air-cargo business conducted within the international airport system.
Domestic Cargo. The opening of Soviet air space put a damper damp·er
1. One that deadens, restrains, or depresses: Rain put a damper on our picnic plans.
2. An adjustable plate, as in the flue of a furnace or stove, for controlling the draft. on international passenger flights landing at Anchorage International, but could boost domestic air cargo business.
Domestic air cargo refers to goods either coming from or going to Alaska and the Lower 48 and goods flown within Alaska. In calendar year 1990 domestic cargo-plane landings at Anchorage International Airport increased 3 percent, from 7,031 landings in 1989 to 7,245 in 1990.
But in recent months, the story has been different. During the second half of 1990, domestic cargo landings, at 3,648, decreased 8 percent from the same period in 1989, which saw 3,983 landings. The drop continued in 1991, with January and February cargo landings falling almost 10 percent -- to 961 -- from 1,064 a year earlier. While oil-spill-cleanup cargoes helped to make 1989 an atypical year, a dismal fishing season in Alaska's Interior and fewer supplies needed for oil production in Prudhoe Bay Prudhoe Bay, inlet of the Beaufort Sea and Arctic Ocean, N Alaska, in the Alaska North Slope region, east of the Colville River delta. In 1968 one of the largest oil reserves in North America was discovered in Prudhoe Bay. and gold mining in Nome also contributed to the late 1990 reduction in domestic cargo-only flights.
Scott Thorson Scott Thorson was born in 1958 and purported to be Liberace's lover for five years. He received many gifts from the entertainer but in 1982 he filed a palimony suit against Liberace for $113 million. , marketing manager for Northern Air Cargo Northern Air Cargo is an American cargo airline based in Anchorage, Alaska, USA. It operates services within Alaska and to Canada and the USA. Its main base is Ted Stevens Anchorage International Airport, with a hub at Fairbanks International Airport.. of Anchorage, says his company hopes to counter the slump by adding routes, such as the Anchorage-to-Deadhorse service started last October. He notes his company's management is most excited about beginning service to the Soviet cities of Magadan and Khabarovsk on Aug. 1. A Boeing 727-200 freighter jet is expected to fly to the eastern Siberian cities once a week. Thorson says most of the goods hauled by Northern Air Cargo will come from the Lower 48. The Soviet airline Aeroflot will transport goods from the two cities to other locations in the Soviet Union.
Northern Air Cargo is the third largest domestic-cargo hauler at Anchorage International. In 1990, the company's all-cargo aircraft carried 80.9 million pounds of freight to and from Anchorage, slightly less cargo than the 1989 total of 82.5 million pounds.
Hauling the most air cargo on domestic routes in and out of Anchorage International Airport last year was Anchorage-based MarkAir. Freight transported via all-cargo and combination cargo and passenger flights rose from 87 million pounds in 1989 to 91.2 million pounds in 1990.
The second largest domestic-cargo hauler at Anchorage International is Alaska Airlines Alaska Airlines, (NYSE: ALK) is an airline based in Seattle, Washington, United States. It operates hubs at Seattle-Tacoma International Airport, Ted Stevens Anchorage International Airport, Los Angeles International Airport, and Portland International Airport. . The Seattle-based airline operates in the Western United States Noun 1. western United States - the region of the United States lying to the west of the Mississippi River
Santa Fe Trail - a trail that extends from Missouri to New Mexico; an important route for settlers moving west in the 19th century , as well as in Alaska. In 1990, it moved 85.2 million pounds of cargo on dedicated and combination flights in and out of Anchorage International, down from 86.6 million pounds in 1989.
Alaska Airlines also is looking to the Soviet Union to add flights. Todd Wallace, Alaska Airlines cargo marketing manager, says some cargo will be hauled on the thrice-weekly passenger flights to Magadan and Khabarovsk that were expected to begin in June.
As domestic air-cargo carriers set their sights on the Soviet Union and Alaska's airport officials seek ways to land warehouse distribution centers in Anchorage to secure a share of the future international air-cargo market, it's apparent that there's challenge aplenty a·plen·ty
In plentiful supply; abundant: "There were warning signs aplenty for their candidates as well" Michael Gelb. in Alaska's air-cargo industry. Although the state no longer can claim the title "Air Crossroads of the World Designed by Robert V. Derrah and built in 1936, the Crossroads of the World has been called America's first modern shopping mall. Located on Sunset Boulevard and Las Palmas in Los Angeles, the mall features a central building designed to resemble an ocean liner surrounded by a ," its advantageous geographic location continues to present new opportunities.
PHOTO : Freight is loaded onto a 747 cargo jet in Anchorage.