Joe garner (not his real name) runs a company in Houston, Texas, which makes
aluminum parts for an equipment manufacturer, also in Houston. The other
company in turn supplies chips for a leading Korean maker of computers and
other electronic equipment.
Joe's company, Conmark, is under intense pressure to produce more and more
parts for the company in Houston which in turn is hard pressed to meet the
demands of its Korean electronics client. Demand for personal computers,
cellular phones and similar products is propelling companies at breakneck
speeds. Garner's company, like other suppliers, works closely with
Consolidated Electric, which provides weekly summaries by computer on which
parts are required.
But the problem is that Consolidated has not as yet approved a Houston
company to do the plating and chemical cleaning for the key parts that
Conmark makes. So Garner must ship many of its parts by air to Arizona where
they can be plated or cleaned by a company on Consolidated's approved list.
His company, Conmark, pays a premium for shipping air freight but it is glad
to do so. And so the story goes. Many companies, suppliers and parts
manufacturers must ship the fastest way to meet the intense deadlines which
are commonplace now in American industry - and air freight, also known as air
express, is the quickest way of all to ship.
Every day, thousands of airlines, flying out of dozens of airfields
throughout the United States, carry loads of cargo in their holds to
destinations all over the country and indeed throughout the world. And
thousands of air express carriers, such as Cannonball in Chicago, advertise
guaranteed delivery of freight by the following day for all materials that it
picks up. The shipper may have to pay a premium for such swift service, but
in many cases, such as the situation of the intense pressure to ship out
parts described above, it is happy to do so. Also, there are hundreds of
companies which supply highly perishable food stuffs - fruits and vegetables,
meat, fish and other commodities to distant destinations, which must arrive
in the quickest way possible to keep their freshness.
Where companies are seeking to hold down their inventories of costly parts
and equipment, they know that by using air freight, they can order the exact
number of components required and still be assured of receiving the goods in
time.
This explains why in recent years the amount of air freight shipped annually
in the United States has expanded to over 12 million ton miles, an increase
of roughly 4 million ton miles of cargo from just a few years ago. A ton mile
is one short ton carried one mile. Since 1930 which was the first year
airliners began carrying cargo, the amount of air freight carried has risen
sharply. In fact it's hard to imagine the United States without air freight.
Residents of Chicago and Philadelphia enjoy fresh oranges flown in from
California. Computers in Detroit run on software that arrives daily from
Phoenix; and auto makers in Detroit outfit their cars with parts arriving
from all over the country. This in turn cuts the cost of inventories and
warehousing which in turn reduces the cost of production. Delivery as you
need it is helping U.S. manufacturers to keep up with foreign competition.
And it continues to expand the importance of air freight in the economy.
Today giant airliners carry passengers and cargo between major cities
throughout the world. And planes and helicopters speed medicine and other
supplies to the furthest reaches of land and jungle. These loads are carried
by commercial airlines which carry both passengers and cargo, and operated by
all of the major airlines. Most airliners carry both passengers and cargo.
Many passenger airlines also operate separate transport planes that carry
only cargo. A few certificated airlines, approved for commercial flights,
specialize in carrying cargo only and do not make any passenger flights. In
addition to commercial airliners flown by approved airline companies, there
are general aviation craft, used for pleasure flying, land surveying, flying
instructions, and so forth, which may be licensed to carry cargo. Airports
offer the runways, ramps and other facilities needed for both air travel and
air cargo. Of the nation's 17,000 airports, only about 700 are equipped to
handle passengers and cargo flown on large passenger airliners.
Regulating the safety of the aircraft industry is the Federal Aviation
Administration (FAA). It establishes the rules that all planes flying in the
United States must follow. Among others, the agency regulates air route
traffic control centers through the country. The FAA also issues licenses to
pilots and certifies the airworthiness of all newly manufactured aircraft.
Originally the Civil Aeronautics Board (CAB) had the responsibility for the
economic regulations of U.S. airlines. The CAB's powers included establishing
the scheduled routes of airlines in the USA, controlling cargo rates and
passenger fares, and approving mergers and other agreements between air
carriers. But in 1978 Congress passed the Airline Deregulation Act which
stripped the CAB of its airline regulatory powers and eventually the agency
was dissolved in December 1984.