Air Cargo and RFID

By Alexander C.H. Skorna and André Richter

A lack of standards and integrated systems among carriers, however, might pose a barrier to scaling up RFID technology from pilot status, which is why current solutions do not integrate the entire supply chain. Due to the high mobility of ULDs, battery life and power needs will become factors as critical as device reliability and out-of-service time. All of this increases device costs, and 23 million units need to be outfitted for a worldwide standard solution.

High RFID equipment prices might be a burden to investors, but our pilot-project review shows that a return on investment (ROI) comes quickly. The value received in the trials was immediate, because the inventory visibility enabled a clear comparison of the goods recorded with the actual physical inventory. Having true inventory visibility, from point of origin to final destination, was of immediate benefit, while minimizing losses was another considerable value. Clearly, RFID is a key module to ensuring a secure trade line.

An RFID chip can store more specific information than a bar code can, but without a full network and industry-wide standards, an RFID tag is more an addition than a bar-code replacement. Nonetheless, the proven ability to obtain cargo information quickly and easily, and to track and trace goods with accuracy, is a huge advantage to any air-cargo carrier.

The next big step—using the pilot projects as a door opener to daily operation—is sure to greatly enhance data value. When RFID data is integrated into an airline's business system, it can generate a long-term ROI as well. As with all leading-edge developments, RFID technology for the air-cargo business requires careful planning and implementation, but the rewards are visible and verifiable.

The air-cargo industry is nearing full implementation of RFID technology, and each new pilot project brings it closer still. As competitive pressures and the demand for airfreight services grow, RFID will become a necessity.

Alexander C.H. Skorna works for Schenker (Asia Pacific) Pte. Ltd., while André Richter is a lecturer at the Institute for Conveying Technology and Logistics—University of Karlsruhe.