Compare And Contrast Essay Thesis
Joey Carnes & Robert Arendal are two of the most influential leaders in the air cargo industry in the world. Joey Carnes lead BAX Global- one of the largest air cargo service providers in US whereas Arendal is leading Cool Chain Association- a non- profit organization to develop standards for the perishable transport.
Arendal is considered as the veteran of the air cargo industry whereas Joey Carnes is leading a company which aims to be among the top five companies in whatever business, they are in.
The basic difference between the two leaders is the fact that Arendal is considered as one of the legends of the industry who not only participated in setting up the industry wise industry but also one of the founding members of the Cargolux Airlines whereas Joey Carnes is still considered as a leader, who is making efforts to emerge as a leader who is heading an air cargo company successfully in a post 9/11 era.
Domestic Air Cargo Market
A domestic air cargo market in US is considered as a stagnant sector with very little growth witnessed on year-on – year basis. During 2007, the overall revenue in the industry increased just by 1% only suggesting a very floundering performance by the industry as a whole.
Other indicators such as traffic volume further indicate that the industry is not performing well. The major reasons cited by the industry experts include high fuel prices which not only increased in the past but also fluctuated at great length which probably has increased the overall risk profile of the air cargo industry.
Further, US economy is weakening especially since early 2007 as companies, due to credit crunch, are mostly interested into managing costs in order to be more competitive. Due to this factor, there is a general shift towards preferring trucks as in comparison to air cargo for shipping purposes. (Keeling).
This is also because of the fact that organizations, out of their innovative approaches, have designed such sophisticated supply chain management systems which put less reliance on independent air cargo services providers.
Further, smaller less than truck load types of shipping companies have taken over the market by creating more fragmentation into the market therefore increasing the overall competition into the market.
This situation suggests that in order to revive the domestic air cargo market, some fundamental changes are required in order to make strategic changes into the industry.
Railway Express Agency and General Air Express
Railway express agency was one of the earliest organizations responsible for cargo services in the country. It was considered as the most preferred cargo company in the country because of its reach and control over the railroads in the country.
RAE also considered being the carrier which almost moved everything from simple fruits to radioactive materials for Atomic Energy Commission of the country. Though it was largely a rail agency. However, its role in developing the air cargo industry can is one of the legendary as it arranged to conduct trials on air cargo during in November 1919. (Allaz).
RAE also was pioneering in creating a business model where the strengths of land cargo service providers to be utilized for air cargo business.
General Air Express was formed by different airliners and organizations in order to capture the market for the air cargo. Though both the companies operated independently however, due to low margins offered both the companies merged and operated as one company.
RAE and General Air Express are considered as pioneers in developing the air cargo market because they were the earliest firms to offer such services and developed business models and assets which subsequently became industry standards.
1. Allaz, Camille. The History of Air Cargo and Airmail from the 18th Century. New York: Google Consultant, 2005.
2. Keeling, Julian A. “Domestic air freight: ‘Back to the future’?” 18 August 2003. http://www.allbusiness.com. 27 January 2009 <http://www.allbusiness.com/transportation/road-transportation-trucking-trucking/11435605-1.html>.