Dive Brief:
- Approximately 80% of companies attending the Trade & Cargo Facilitation Association (TCF) meeting in Sweden shared a mutual interest in taking action toward developing a data pipeline, the European Shippers' Council (ESC) reported.
- Challenges to implementation include a lack of compatibility of legacy systems, strict oversight competition authorities, cybersecurity and privacy, compliance and the cost of investment.
- The meeting recognized shippers, carriers, ports, 3PLs, developers, academics and industry associations all have a stake to pursue increased transparency.
Dive Insight:
The International Air Cargo Association has long pressed for industry modernization, but progress is nearly nonexistent.
Currently, air shippers must undergo a 20-step, 21-document process before moving cargo. As a result of the laborious process and various redundancies, industry stakeholders continue to call for an open platform system that allows for more seamless integration and transparency to reduce or eliminate pointless data re-entry. Such a system would, ideally, provide easily accessible rates, consumer demands and schedules.
To do so, however, the industry must first establish a common standard and digital language wherein data can be universally interpreted by any stakeholder.
In other words, the industry must go paperless so that shippers new and old can gain access to global air freight services. Although the market is currently expanding, its popularity may yet be hampered by high costs and inaccessibility for SMEs, a problem which ocean carriers have sought to correct through increased digitization.
Yet, the high willingness to adopt a solution despite little action shows greater challenges are hampering innovation. Primarily, the global nature and regulations surrounding air travel complicate nearly all such shipments.
There may yet be hope for the industry: The approval of the World Trade Organization's Trade Facilitation Agreement means regulators worldwide will begin standardizing and digitizing their own processes ,perhaps opening the door for a similar initiative in the air space.
