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Flying Freight
Flying Freight
Lecture Objectives:
Lecture Summary:
When importance of speed outweighs cost, then air is attractive for freight!
Emergency shipments
Typical commodities include mail, communications products, racehorses, etc.
Speed, travel time advantage can be off-set by flight frequency and timing
Smaller communities have experienced reduced frequencies
In-direct routing due to hub and spoke networks
Cost Structure
The industry operates at: high variable costs (70-90%), low fixed (10-30%)
Government support of highway structure
Terminals not too capital intensive
High variable costs (about 60% of total, but can be as high as 80%)
Types of Equipment
All cargo
Extra-large planes
Wide body
Narrow body
Belly cargo
Existing airliners
Smaller loads – maybe a few containers