Domestic Air Cargo Industry in Australia - Bureau of Infrastructure ...

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Chapter 2involved in the movement of passengers. However, a large part of themarket is served by freight forwarders using small freighter aircraft.The freight carried is mainly business documentation, with themovement of bank papers between country centres and capital citiesbeing one of the major traffics.Overnight express cargo is probably the largest category in terms ofrevenue. This traffic mainly involves door-to-door overnighttransport with lodgment by 5 pm on a working day and guaranteeddelivery by 9 am on the following morning. It is generally carried onservices where the aircraft do not uplift passengers.The third category of air cargo also requires fast delivery but thetransit time is longer. Cargo is lodged by 5 pm on a working day withdelivery during the late morning or afternoon of the following day.This traffic may be carried on overnight freighter services wherecapacity is available but in many cases it is moved on passengerservi ces.Off-peak cargo is the fourth broad category of air cargo. Thistraffic is carried when space is available on aircraft and deliverymay be up to several days after lodgment.Mai 1Mail carried on domestic air services can be divided into twocategories. Air mail accounts for the majority of traffic and coversarticles which require a high quality of service and rapid delivery.Surface mail by air is mail that would normally be carried by surfacetransport. It travels by air when capacity is available on aircraftin order to speed up delivery. In this Paper, the term air mailcovers all mail carried by air.Mail has a number of characteristics which affect the transport task.Transport arrangements are constrained by the processing system whichrequires the mail to arrive in the destination city by 3 am if it isto be delivered on that day. The volume of traffic on individualroutes is highly volatile and hence it is often difficult for theairlines to provide adequate capacity while maintaining satisfactoryloadings of cargo.MARKET SIZEAir transport has traditionally accounted for a small proportion oftotal cargo movements in Australia on a weight basis. The availabledata indicate that scheduled air transport services carry around 0.01per cent of Australian domestic freight in terms of tonnes consigned5
Occasional Paper 87and 0.06 per cent on a tonne-kilometre basis (BTE 1984, 9-10).l Airfreight represents approximately 0.3 per cent of interstate freightmovements in terms of tonnes consigned (Australian Bureau ofStatistics 1986, 3). However, the share would be significantly higheron a value basis due to the high average unit value associated withair freight (BTE 1980, 22-23).2 Air transport is also very importantin certain comodity markets.The air cargo market has expa,nded significantly in the post-warperiod. The growth has been driven by a variety of factors includingincreased population, higher income levels, growth of time-sensitiveindustries such -as finance and advertising, moves to centralwarehousing, computerisation and adoption of the just-in-timeprinciple in manufacturing. Work undertaken by the BTE suggests thatunder, current conditions a 10 per cent rise in real income (asmeasured by Gross Domestic Product) would result ina 14 per centincrease in air freight traffic (BTE 1986, 41).Figure 2.1 illustrates the trends in the amount of freight and mailtraffic carried on domestic airline services between 1946 and 1986.Air freight increased from 6.7 million tonne-kilometres to 137.3million tonne-kilometres over this period while mail traffic rose from1.3 million tonne-kilometres to 18.6 million tonne-kilometres. Theoverall airline cargo market has generally followed the trend in airfreight traffic as a result of the dominance of the latter sector incargo movements.Several broad stages in the development of the air freight market areapparent in Figure 2.1. From 1946 to 1956 air freight tonnekilometresincreased at an average compound rate of 24 per cent perannum due to strong growth in the Australian economy (Department ofTransport 1979b, 279). Between 1956 and 1961 the market declined by 7per cent per annum as a result of factors such as the rapid1.2.Department of Transport and Cohunications data on tonnes of cargocarried on domestic scheduled air services overestimate the tonnesof traffic consigned because a particular item is counted eachtime it passes through a major airport or is transferred to anaircraft with a different flight number. The level of doublecountingis not known with any accuracy but one carrierinterviewed during the study estimated that it was around 25 percent.Australia's international air freight market provides anindication of the potential variation in market shares based onweight and value. In 1984-85 air freight accounted for less than0.1 per cent of Australia's overseas trade on the basis of grossweight but around 14 per cent in value terms.6
Page 1: BTE Publication SummaryDomestic Air
Page 6 and 7: CHAPTER 7CHAPTER 8CHAPTER 9APPENDIX
Page 8 and 9: 7.2Annual change in average yield i
Page 10 and 11: CHAPTER 1INTRODUCTIONThe discussion
Page 12 and 13: CHAPTER 2 THE AIR CARGO MARKETThe d
Page 16 and 17: Chapter 2176 -150 -150 -140 -130 --
Page 18 and 19: Chapter 21984-85. The importance of
Page 20 and 21: Chapter 2sources indicate that the
Page 22 and 23: Chapter 2TABLE 2.4 AUSTRALIAN DOMES
Page 24 and 25: Occasional Paper 87commenced with t
Page 26 and 27: Occasional Paper 87required the two
Page 28 and 29: Occas ioml Paper 87market, Ansett a
Page 30 and 31: Occasional Paper 87specialist freig
Page 32 and 33: Occasional Paper 87characterised by
Page 34 and 35: Occasional Paper 87TABLE 4.1MAJOR E
Page 36 and 37: Occasiona 7 Paper 87general manager
Page 38 and 39: Occasional Paper 87also specificall
Page 40 and 41: Occasional Paper 871984, 2-3). A sp
Page 42 and 43: Occasional Paper 87the major operat
Page 44 and 45: Occasional Paper 87also substantial
Page 46 and 47: ~~CHAPTER 5 CURRENT INDUSTRY PARTIC
Page 48 and 49: Chapter 5TABLE 5.2 AUSTRALIAN DOMES
Page 50 and 51: Chapter 5newspapers accounted for m
Page 52 and 53: Chapter 5If cargo is not under bond
Page 54 and 55: CHAPTER 6 CURRENT OPERATIONAL PRACT
Page 56 and 57: Chapter 6not obtain as much of the
Page 58 and 59: Chapter 6divisions of AT1 at rates
Page 60 and 61: Chapter 6combined banks contract fo
Page 62 and 63: CHAPTER 7 RATING PRACTICESThe struc
Page 64 and 65:
Chapter 7carried at the published r
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Chapter 7(Department of Aviation 19
Page 68 and 69:
Chapter 7TABLE 7.2ANNUAL CHANGE IN
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Chapter 7contacted during the study
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Occasional Paper 87TABLE 8.1 FORECA
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Occasional Paper 87domestic routes
Page 76 and 77:
Occasional Paper 87adequate capacit
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Occasional Paper 87large amount of
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CHAPTER 9 CONCLUDING REMARKSThe dom
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Chapter 9but it appears that in at
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a30TABLE 1.1 AUSTRALIAN AIRLINES' F
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W TABLE 1.2 AAF'S FREIGHTER NETWORK
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TABLE 1.3-TNT AIR'S OVERNIGHT FREIG
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% TABLE 1.4 TNT AIR'S DAYTIME FREIG
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CO03 2r,TABLE 1.5 (Cont.) WARDS EXP
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Occasional Paper 87(1984), Transpor
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Occasional Paper 87- (1979e), Anset
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ABBREVIATIONSAA F Ansett Air Freigh
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