Going It Slowly: RFID and Air Cargo

Integrators enthusiastic about RFID, but enthusiasm not always mirrored by buyers

Despite reservations across the industry about the use of radio frequency identification technology in air cargo, several of the express operators are forging ahead with the new technology for tracking. Already, TNT proudly announced last December it had completed a pilot phase and was ready to integrate RFID equipment into its existing systems for shipment tracking.

Outside the integrator camp there is decidedly less enthusiasm among air freight technology experts for RFID. "There is a lot of talk about RFID, but it's not yet proven technology," said Christopher Shawdon, vice president and partner of Logistics Solutions at Unisys. Traxon, the conduit for electronic data flow between some 3,000 forwarders and about 90 airlines, is not anticipating any impact from RFID on its architecture in terms of message standards or file sizes for the time being.

The go-slow approach contrasts sharply with a large swath of the logistics industry, where big retailers such as Wal-Mart, Target Stores and Germany's Metro have advanced ambitious RFID mandates for their suppliers and logistics providers have scrambled to help the shippers meet the demands.

In the air freight industry, a more immediate objective for shippers and forwarders is getting information in real time. Some airlines are there, but quite a few still have some way to go, according to Bob Scribner, senior manager of global logistics of Fairchild Semiconductor. "A lot of carriers are still struggling in that area. About 50 percent of our carriers are adequate to excellent, the other 50 percent are not there yet," he said.

The real-time information is most important to shippers and consignees when it comes to problems.

For most shippers - and, by extension, their forwarders - the focus is on exception reporting. They are far less concerned with regular status updates in a field where speed of delivery is supposed to gloss over deeper issues in supply chain management.

"We do only the exceptions. You can't trace every shipment. We don't have the time to do that," said John Mascaritolo, director of global logistics of electronics shippers NCR.

"Shippers look for exceptions. We work by exceptions," said Elio Levy, vice president of sales and marketing of New York-based forwarder Logfret. Like Mascaritolo, he finds it impossible to keep tabs on every shipment.

According to Scribner, demand for in-transit visibility increases the closer people are to the customer. He wants to see the exceptions but customer service staff want to be able to track every shipment.

Second to exception alerts come daily or weekly reports, as far as traffic managers are concerned. "A lot of people want regular e-mail updates every morning and alerts if something happens during the day," said Bob Imbriani, vice president of international operations of Winnboro, Texas-based forwarder Team Worldwide.

Shawdon says Unisys was surprised by the strong demand for full status history of shipments among users of the Cargo Portal System, the booking portal Unisys developed for carriers United Airlines, Northwest Airlines and Air Canada and which has since been rolled out to more airlines. CPS added functionality to display the full shipment history some 18 months ago.

Shipping managers and forwarders may not want to track every shipment, but they do use tracking services extensively.

At CPS, the tracking functionality is used six times as often as the booking function. That's although CPS users can only track shipments on the six member airlines via the site, a figure which is not likely to change.

"I think it will stay that way. You can go to any number of airline Web sites to track shipments. Syntegra's CCX.com gives you about 60 carriers. There's no value in adding that to the portal," Shawdon said.

Users' appetite for tracking information is going up. Traxon recorded a 26 percent increase in track-and-trace messages in its network during the first eight months of this year.

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