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Will Air Cargo Community Adopt Bundle Pricing Model?

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by Dilip Kumar J
26 March 2015

During the process of procuring air freight service, freight forwarders had a challenge while quoting rate for the air freight due to the lack of transparency in surcharges, on the other side air freight category team from shippers end has been facing challenge in evaluating the freight forwarders with surcharges being major differentiating factors among the suppliers. Recently, airlines based out of Middle East took an initiative of All-IN pricing model in the beginning of 2015. New pricing model is expected to deliver transparency in pricing elements such as fuel and security surcharges. Primarily this article will be focused on the benefits for freight forwarders and shippers and major industries that will be impacted, later part of the article will addressing the expected challenges for the cargo airlines, freight forwarders and shippers with fluctuating fuel prices, tight capacity across major trading lanes and challenging security cost across different geographies. Surcharge still opaque element in air freight rates Major cargo airlines based out of MEA has adopted a new pricing model which is bundling fuel and security surcharge along with the base rate that would bring some relief for the shippers as well as freight forwarders. Shippers believe that move taken by the airlines would bring transparency in the pricing elements as well as the rates would be directly linked to the major cost factor �Jet Fuel'.   Author: Dilip Kumar J

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