IATA’s April report shows that Electronic Air Waybill (e-AWB) penetration has breached the 50% mark. That means that 730,000 e-AWBs have been processed during the last month to reach 50.7%––a 1.3% increase from March.
According to the report, two airlines (Kenya Airways and flydubai) have managed to process 100% of their waybills electronically. Others, like Cathay Pacific and Delta Air Lines, aren’t far behind. Others who contributed to the milestone include Expeditors, who leads at a 69.4% penetration level, and Hellman Worldwide, who follows closely at 2 points below (67.9%).
This is welcome news in air cargo. However, it’s still not the 100% e-AWB that the industry aspires to reach.
After missing last year’s target by close to 8 points, IATA issued 10 new resolutions for air cargo. “Remove Paper” is the second on the list (the first was “Embrace e-Commerce Growth”).
“Today, one air cargo shipment can still require up to 30 pieces of paper,” IATA’s Global Head of Cargo, Glyn Hughes said at the time. “The industry needs to accelerate the implementation of end-to-end paperless transportation processes through programs such as e-freight and e-AWB.”
While breaching the 50% mark is promising news, to achieve this year’s 62% target, all sectors of the industry need to step up their game.
Industry-Wide Commitment is Crucial
To achieve its target goal, the industry needs to be fully committed to e-freight. That means all parties involved––shippers, carriers, and consignees––will have to demonstrate a high level of commitment. But first, certain issues have to be addressed.
One of the biggest problems is how complex the entire supply chain is. Every piece is independent and is governed by its own interests. For example, just because an airline has adopted 100% e-AWB at local offices doesn’t necessarily mean that it’s going to conduct its business strictly electronically with forwarders in separate locations, especially if the latter is yet to adopt e-AWB. Agents must ensure absolute clarity in data exchange and operational processes.
In the spirit of creating a single process that can be the standard for all, IATA has developed the AWB 360 program. The program brings together airlines, forwarders, and Ground Handling Agents (GHAs) to agree on e-AWB standards. However, not all airlines support the e-AWB process. Thus, paper is the only way to go in certain instances.
The slow adoption of e-AWB has also been blamed on lack of trust or guarantee. For instance, almost all forwarders generate and send the required air waybill electronically (the FWB message). However, not all airlines return the acknowledgment message (the FMA message) to the forwarder after processing the FWB data. Granted, this isn’t mandatory under the e-AWB 360 program. But this has a negative impact. Without the confirmation, forwarders can’t be certain that the loop is closed. This may make it harder for them to put their trust in the process to deliver their services. For complete commitment, these standards need to be tweaked to make sure that all the parties in the chain feel confident in the decision.
IATA recognized the importance of data quality more than a decade ago and implemented the Message Improvement Program (MIP) back in 2006. This program has played a key role in e-AWB today. In fact, IATA mentioned it in its recently published e-AWB Playbook.
To further improve data quality, IATA introduced error codes into MIP in 2010. This would allow airlines to give a detailed explanation of why specific data was rejected. With this amount of detail, other parties (such as the forwarders) could finally process errors automatically. This would lead to faster and easier re-transmission of the message. Unfortunately, not many airlines or Cargo Community System networks make use of these codes. If e-AWB is to succeed, standards like this can’t be overlooked.
Considering that the recent developments in the adoption of technology in air cargo, the industry is committed to implementing e-AWB. Some markets have already adopted it, and others are catching on. However, the industry needs to make the shift more quickly.
According to Drew Crawley, IAG Cargo CEO, the inefficiency that paper brings to the air cargo industry is “bordering on the criminal” and that it’s the customers who end up paying for it. So, it makes sense that removing paper from the processes ranks high on the industry’s to-do list. To achieve this, the industry needs to collaborate. As Crawley puts it, “milestones are not the only answer, you also need a commitment from industry players. Each has a responsibility to be ready.”