Preparing Washington for air cargo’s big takeoff

Preparing Washington for air cargo’s big takeoff
Air freight is a popular way for Washington exporters to send their products to market in Asia. However, Sea-Tac International Airport is expected to reach full capacity by 2034. A new study planned by the state legislature aims to identify other Washington airports where capacity can be increased, as well as improve efficiency in the system.

Air freight is a popular form of transport for Washington producers exporting their products overseas to the Asia market. The state’s primary gateway for exports is Sea-Tac International Airport; in 2016, it handled 366,000 tons of cargo, making it the 19th busiest airport in the nation. Almost 90 percent of its international cargo comes from Washington.

Although the Port of Seattle wants to double the airport’s tonnage by 2036, the Washington State Department of Transportation estimates the airport will reach full capacity two years before that. A new study by the state plans over the next year to identify alternative airports in Washington where some of the new freight could possibly be shifted, while also finding ways to reduce congestion within the complex system products currently travel while en route to market.

Compared to trucking, shipping and rail, air cargo handles a tiny portion of goods; just one percent of total global tonnage. However, airplanes can travel to areas otherwise inaccessible or deliver perishable products such as cherries much faster than other modes of travel.

Joe Bryan is the project manager WSP, the company producing the report. At the Joint Transportation Committee’s November 15 work session, he told panel members that air freight serves “as the failsafe to the entire supply chain system. They’re the ones that when things don’t work perfectly, you can still get goods to market on time one way or another.”

This makes it a highly lucrative industry of around $100 billion annually. In Washington, Sea-Tac’s air freight yields an estimated $22.7 billion in annual economic value to the state.

It’s also a growing industry, with the market size doubling every decade. In 2014, the Port of Seattle had an 11.8 percent increase in cargo tonnage alone. The port hopes to increase that by five percent annually, and has already invested $23 million in facility upgrades to handle the new activity.

But Sea-Tac’s airport capacity is just one of several issues that may concern Washington producers. The process for moving items via air cargo is complicated; often it requires 20 separate documents and more than seven companies. According to a presentation by Bryan during the November 15 work session, “the process is getting more complicated, not less, due to additional requirements for security and safety.”

The combination of businesses, airports and local governments means “the performance is a joint product of the public and the private sector. It’s not just what the private operators do,” Bryan added. “It’s also what the public system enables them to do. And the combination is what makes the difference in the market…”

While “congestion” and “capacity” are often used interchangeably in describing the cause for delayed flights, traffic on the roads can also cause problems.

Rep. Mark Hargrove (R-47), who works for Boeing as an instructor pilot, told colleagues at the work session that road conditions can have a large impact on freight capacity. “Let’s say a truck carrying Microsoft products is delayed a little bit getting to Boeing Field or Sea-Tac, and then that flight is going then to Louisville. It’s not so much that truck being delayed; it’s going to delay the stuff getting to Louisville…each minute that it’s late cost thousands of dollars because if it’s getting to Louisville late, then it gets redistributed to all the other places. There are penalties to be paid and that kind of stuff.”

Rep. Gael Tarleton (D-36) said: “The connectivity between land, air and sea networks is extremely important, particularly to Washington state. We have so many transportation projects all over the state. Some of the corridors…might be in better condition to handle a significant shift in the air cargo demand compared to some of the major airports which are being surrounded by substantial transportation projects.”

However, delays don’t just add to the cost of shipping. It makes it harder for Washington airports to compete for cargo freight with other major airports such as Los Angeles. It’s an option some Washington growers have taken in the past when congestion proves too great.

“What we really want to accomplish is we want the entire state system to be more competitive and better able to exploit the opportunities available in the marketplace,” Bryan said. “I think we will end up being able to say…that it isn’t so much that Washington airports are competing with one another; it’s that Washington is competing with other locations.”

A meeting is scheduled Friday, December 8 with stakeholders that include representatives from the Washington Tree Fruit Association, FedEx, Boeing Field and the Washington Trucking Association.

The $500,000 study was authorized by the state legislature during this year’s session as part of the transportation budget. The report is due by December 14, 2018.

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