Changes impact air express The nation's air express marketplace has experienced dramatic changes over the past year as the number of carriers competing for expedited shipments continues to skyrocket and the lines that had traditionally separated transportation providers begin to blur. That, according to a study by the Air Cargo Management Group (ACMG). Chief among the changes:
1. UPS launches an Internet-based document exchange service, believing this service will siphon off up to 30% of its business in the future. That means most of the growth in the express business will come from package, freight, and international segments.
2. The U.S. Postal Service gears up to offer two-day service and offers guarantees on priority mail, including package tracking and separate transportation networks operated by private sector companies such as Emory.
3. Last year's Teamsters' strike against UPS exposes the company's 80% control of the market and opens the door to more aggressive competition from the postal service, LTL companies, and the newly merged Federal Express and Roadway Package Service.
4. Ground parcel services are upgraded to offer performance guarantees such as time-definite deliveries and more information-rich customer interaction.
5. Most of the air express industry moves away from flat-rate pricing and adopts distance-based pricing.
6. More air express companies are using trucks and regional hubs and applying information technology to improve service to shippers.
7. Shippers are increasingly indifferent to mode and expect high performance from all transportation providers. They have become savvy about the use of time-definite versus express shipping for cost reasons.
Going paperless In a move that already is paying off in faster processing times and fewer errors, Ruan Transportation Management Systems and the Motor Vehicle Div. of the Iowa Dept. of Transportation have developed a paperless automated vehicle titling system. When Ruan enters a tractor unit number into a PC, the computer automatically completes the electronic application and downloads it into the state DOT system.
Formerly, that information was pulled from a PC and manually entered on a paper application. The application was then sent to the DOT, where, once again, the information was manually entered into its system.
"Prior to the implementation of the electronic program, a clerk could process 70 titles on a day with no interruptions," says Shirley Andre, director of the motor vehicle division. "Now, a clerk can process 137 titles within a four-hour time period, including daily interruptions such as answering the telephone and providing counter assistance."
In a related move, Roadway Express can now retrieve and download copies of proof-of-delivery documents from the Internet in as few as 30 seconds. The records will be made available for 30 days following delivery. The ability to pull delivery receipts, bills of lading, and weight and inspection certificates from the company's Internet site adds to the carrier's growing family of information technology tools. Already offered are shipment tracking, rate quoting, routing information, transit time calculations, sailing schedules, and the Roadway service locations.
Matchmaker, matchmaker Burnham has teamed with Sky Courier to provide a seamless, one-call system for integrated parts management, including next flight out and emergency services. Parts On Time will combine Burnham's reputation in inventory management and Sky Courier's rapid-response capability. Customers will call one number to order parts from the nearest Burnham warehouse and expedite them to the customer using Sky Courier's rapid response delivery system. If the part isn't in the nearest warehouse, the internal system will locate it and implement delivery from there. The result: one contact point and one bill.
Celadon Group agreed to be acquired by a group of its managers and Odyssey Investment Partners for $259 million. Odyssey is a newly formed $680-million fund established to pursue private equity acquisitions. In another acquisition by an investment firm, Xtra Corp., a lessor of over-the-road trailers and intermodal containers, accepted a $1.9-billion buyout from a new company that will be owned jointly by Apollo Management, a New York-based investment firm, and Interpool Inc., an ocean container leasing company. Apollo, which owns a controlling interest in MTL Inc., also announced that it will add Chemical Leaman Corp. to its portfolio. MTL is the holding company for Montgomery Tank Lines.
In its eighth acquisition in the past 12 months, Transit Group has bought KJ Transportation and an affiliated truck brokerage business based in Farmington, N.Y., for $3.5 million in cash and stock. KJ operates a fleet of 300 company-owned tractors and 160 owner-operators, plus 900 trailers.
Transit Group also will acquire NorthStar Transportation Inc., a Dothan, Ala., motor carrier operating 57 tractors and 105 trailers. Transit Group also said it completed its acquisition of Network Transport Ltd., a private fleet with 55 trucks and 225 trailers that focuses on refrigerated freight.
