This year is supposed to be a key year for the IATA e-freight programme - the project to remove all paper documents for air cargo - as airlines move towards the target of having all air waybills electronic by the end of 2014. Full e-freight with all paper documents eliminated is envisaged a year later.
Crucial to achieving these targets will be the efforts of IT providers such as Mercator, the IT division of the Emirates Group. It now provides next generation IT services to 20 airlines, four of them added in the last four months, and it is reporting a surge in electronic bookings for those carriers. "We are seeing a definite lift-off in direct e-commerce in the cargo business," says Mercator vice-president Duncan Alexander. "This is something that has not happened before."
Mercator is unwilling to give figures for specific airlines, but Alexander says on average electronic bookings are now running at 20-25% of all air waybills on carriers hosted by Mercator, double what it was three years ago. Some carriers are doing even better. Garuda and Sri Lankan now get a majority of bookings via their websites, and Emirates has operated 100% paperless flights on some routes.
It is important to distinguish between electronic booking, electronic air waybills and full e-freight. The figures Alexander is quoting are for e-booking - booking a cargo shipment electronically rather than by phone - whereas full e-freight requires an array of documents, such as shipper manifests, to also be electronic.
But as Sandeep Fernandes, product manager for cargo at Mercator, points out, e-booking is an important start. "It has huge cost implications for airlines. They no longer have to capture data. The data is sanitised at source, which is the whole point of e-freight: enter the data once and do it right."
Online booking is also targeting a key sector of the freight forwarding community that has so far been resistant to e-freight. Whereas larger forwarders tend to be geared up to send the electronic data interchange (EDI) messages - for example the FFR booking request message - around which e-freight is built, smaller forwarders do not always have this capability.
But if those smaller forwarders are willing to book via airline websites, this important sector of the air cargo industry can be brought into the e-freight fold. Fernandes reports that the website bookings are showing the big percentage rises, with EDI messaging still increasing, but at a much lower rate.
Fernandes, though, says if the cost of processing paper is simply replaced by the cost of paying for the increasing number of EDI messages that e-freight demands, the project will not deliver all the cost savings it potentially can.
So, he believes the direction of travel must be towards free messaging over the internet, whether via online portals, fttp file transfer or XML messaging, all things that the SkyChain system of Mercator is equipped to cope with.
Mercator is keen to take a role in setting industry standards in all these areas. As well as being a participant on the IATA e-freight committee, it also takes part in its Cargo XML task force. "This is an area where the industry needs to move to the next level," Fernandes says. "IATA is doing a great job on XML standards, but the industry now needs to adopt it."
On the passenger side, Mercator is involved in IATA initiatives. It is, for example, halfway through moving customers of its RAPID revenue accounting system to the IATA Simplified Interline Settlement project, and it is working to sign up its 54 airline customers to the direct data service, the new IATA database for market intelligence.
Alexander says this will provide much more powerful information for airlines, capturing direct bookings and low cost airline data that is not contained in the data airlines currently buy from GDS suppliers. "We are at the forefront of making this happen, and we are the ideal partner to work with IATA to get airlines to transmit data to the new central database," he says.
Mercator is working with IATA on safety management systems, offering a set of database terms developed for Emirates as a basis for a common industry terminology on safety. It is also on committees for the next stage of the Simplifying the Business programme.
"IATA is an extremely important part of Mercator," Alexander insists. "In the past we have not told everyone what we are doing, but we are knee-deep in this stuff. We continue in our commitment to bring greater benefits to the industry through simplification, standardisation and automation, and are proud to play a pivotal role in such changes."