McLean's - American Shipper

Express firms make government connectionsBig integrators UPS and FedEx are taking internationalcustoms issues head-on.The government of El Salvador has signed a cooperationagreement with UPS aimed at simplifying the CentralAmerica country’s customs procedures.Meanwhile, FedEx Express and the Australian TradeCommission have signed a two-year agreement to expandtrade between Australia and the United States.Last October, PROESA, the El Salvador government’sdepartment dedicated to promoting investment in thecountry, visited UPS’s offices in Miami, proposing toestablish a customs clearance system in El Salvador basedon UPS’s global operations.Under the new system, courier companies will now beable to withdraw their merchandise from Customs at theEl Salvador International Airport within 48 hours of thegoods arriving. The agreement also considers that shipmentswhose value Free On Board (FOB) are lower than$200 can be removed from Customs with the presentationof the corresponding air bill and invoice; however, a spotcheck of the merchandise can be requested for verificationpurposes. If the value FOB is more than $200 but less than$3,000, the removal of the goods will be authorized withthe presentation of the Merchandise Declaration. Thisdocument can be created by the operator of the expressdelivery or courier.The prices that are charged for customs procedures willbe representative. The authorization timetable is valid forone year and renewable with prior authorization from theCustoms Department.“The signing of this agreement is of great importancefor El Salvador. It’s a valuable element that will contributeto expedite customs procedures and will generate newsources of investment in the country,” said Ana Vilma deEscobar, president of PROESA.“At UPS, we are very proud to be part of this agreementthat will streamline and facilitate commerce to improve ElSalvador’s competitiveness,” said Stephen Flowers, presidentof UPS Americas. “We are committed to our presencein the country and we hope to maintain a close cooperationwith the business community and the government institutionsthat have made this agreement possible.”In Australia, FedEx’s agreement calls for it to promoteto its customers the benefits of the Australia Trade Commission’sexport assistance network, which is spread across50 countries, including 18 U.S. cities. The agreement alsosupports joint activities between FedEx and the commission,including Web site links, joint export promotion, salesforce training, and direct marketing campaigns.“Our alliance fits within the FedEx internationalgrowth strategy, which includes strengthening Australia-U.S. export volume,” said Michael Ducker, executivevice president of international for FedEx Express, in astatement.FedEx and the Australian Trade Commission want tobuild on the U.S.-Australia Free Trade Agreement, whichbecame effective in January 2005.FedEx developed a similar alliance in 2004 with theU.S. Commerce Department’s Commercial Services topromote U.S. small business exports through marketingand educational programs.Colography: 2005 record year for U.S. air exportsAtlanta-based cargo market consultancy company TheColography Group Inc. forecast that 2005 U.S. air export44 AMERICAN SHIPPER: APRIL 2006shipments and revenue figures will reach record levels.Colography reported that after the first three quartersof 2005, nearly 68 million shipments moved in U.S. airexport service. The consultancy anticipates full yearexport shipments to exceed 90 million, surpassing the88.7 million shipment record set in 2000.Air export revenue for the first nine months of 2005was about $6.9 billion, Colography said. The companypredicts that the full year export revenue will go past the$9 billion barrier for the first time, breaking the $8.5billion record set in 2004.Colography said that during the first nine months of2005, there were 1.85 billion U.S. domestic air shipmentswith a value of about $30 billion. Domestic shipments andrevenue for the full year 2005 are projected to beat 2004results, but fall short of the records set in 2000.“The effects of a weak U.S. dollar, a resilient U.S.economy and a rebounding global marketplace willmake 2005 a strong and, in the case of U.S. air exports,a record-setting year for air cargo,” said Ted Scherck,Colography’s president. “Though we do not yet have finalresults for the fourth quarter of 2005, there is no reasonto believe it should be any weaker than the quarters thatpreceded it.”“The fourth quarter is historically the strongest periodof the year because of the accelerated activity surroundingthe peak holiday season,” Colography said.Some key findings in the third quarter 2005 editionof Colography’s “U.S. Domestic and Export Air Trafficand Yield Analysis By Competitor and Market Segment”report include:• On the U.S. air export side, the six main competitors— FedEx, UPS, U.S. Postal Service, DHL, EGL Inc. andBAX Global — controlled 77.3 percent of the shipmentmarket during the third quarter of 2005.• The “all other competitors” category — comprisedmostly of airlines and freight forwarders — saw theirshipment share decline to 22.7 percent as of the end of2005’s third quarter from 24.8 percent in the first quarterof 2004.• On the domestic front in 2005, quarterly revenueand tonnage gained on a sequential basis. However, shipmentvolumes declined by more than 10 million from thesecond to the third quarter, driven by continued diversionof lightweight, short-haul air traffic to the ground.• DHL Express reported sequential gains in domesticair shipment share from 10.2 percent in the first quarterto 11.4 percent in the third quarter.• USPS held the largest domestic shipment sharethrough the first nine months. However, its share of themarket declined with each quarter, from 37.9 percent inthe first quarter to 36.1 percent in the third quarter. FedExExpress’ share declined 0.5 percent over that period, whileDHL’s and UPS’s shares increased.Colography will publish the fourth quarter and full-year2005 results in early April.Boeing predicts $770 billion Asia-Pacific investmentBoeing forecast that Asia-Pacific airlines would providethe largest market outside North America for newairplanes over the next 20 years.Worldwide, Boeing anticipates airline’s investing $2.1trillion for about 25,700 aircraft in two decades, with Asia-Pacific operators purchasing about 7,200 new airplanesworth $770 billion, nearly tripling the region’s fleet toabout 8,600 airplanes by 2026.