Air freight opportunities

An Interesting workshop at the TCA Convention was one that discussed truckload carriers expanding their transportation services to include air freight. This encompasses handling the ground portion of air shipments to expedited all-truck transportation while marketed as “air freight,” to forming air freight forwarder subsidiaries.

The session centered on legal opportunities and pitfalls. It was presented by Daniel Barney, managing partner of Washington, DC-based full-service transportation law firm Scopelitis, Garvin, Light, Hanson & Feary.

Underscoring the opportunities, Barney said air freight is “attractive” because the rates are generally higher, and there are lower cargo liability limits. But to be successful, carriers in this field need to choose their roles for the optimal reward versus some outstanding risks.

Additional liabilities are involved in air freight that don't necessarily apply to motor freight, he noted.

Not the least of these risks, said Barney, revolves around cargo security and where the load originates, because it may end up on an airplane.

In that case the Transportation Security Administration (TSA) is involved, and air cargo security rules come into play. Major penalties for non-compliance are as much as $10,000 per violation per day.

Hazmat shipments also are of concern as failure to follow Federal Aviation Administration (FAA) rules for these shipments can result in $50,000 fines. But these fines pale in comparison to any issue where personal injury or property damage liability comes into play.

Barney advised that when building a corporate structure and culture for air freight business, an appropriate organization must manage the risks to avoid non-compliance or liability. The business also must have the capability to hire, train, and supervise personnel for the special requirements of air freight handling.