Shuttle trucks making cargo runs to Los Angeles International Airport frequently wait four hours, or more, to exchange a shipment.
And the congestion is expected to get worse: construction from a massive transportation project to facilitate access at passenger terminals will disrupt some freight operations and the airport authority has postponed plans to consider expansion of outdated cargo facilities.
The lack of space puts a premium on stakeholders finding ways to make cargo transfers more efficient, logistics providers say.
“Our concern is just being able to get in and out of the terminals faster,” Tom Griley, CEO of Griley Air Freight, said. “If they start to handle any more cargo or cargo increases by 10%, the lines are going to increase by 50%. I mean, they’re right at capacity.”
LAX is No. 10 in the world for cargo tonnage processed. Last year, it handled 2.2 million metric tons of freight, an increase of 2.4% from 2017, spurred by increased trade with Asia, the popularity of e-commerce and the use of larger aircraft that can hold more belly cargo.
Every day, more than 1,200 flights with cargo land and takeoff from LAX. The airport has more than 2.1 million square feet of warehousing and tarmac space spread among 29 facilities, including the largest airport refrigeration facility and perishable center on the West Coast. Last year, 2.9% of all U.S. trade by value flowed through LAX.
LAX occupies 3,500 acres, making it one of the smallest of the nation’s major airports. Hartsfield Jackson Airport in Atlanta sits on 4,700 acres. It’s squeezed on two sides by the communities of El Segundo and Westchester. The scattered nature of the cargo facilities, combined with the limited space, have contributed to delays in cargo flows, according to experts.
“It’s like a closet. If you keep putting stuff into the closet and you don’t take anything out, eventually you can’t find anything, because it’s full,” Peter Landon, president of the Los Angeles Air Cargo Association, told FreightWaves.
Truckers can wait four hours to recover a load, he said, with wait times varying by facility. At LAX, most airlines use third-party ground handlers, such as Mercury Air Cargo, Swissport and Worldwide Flight Services, to handle cargo transfers, loading and unloading and storage on their behalf. Those shared facilities, which tend to support international and all-cargo carriers, are where most of the congestion is being experienced
More delays are coming with the start of construction this fall on a 2.25 mile elevated guideway with six stations. The electric train system, part of a $17.6 billion passenger-terminal modernization and access-road refurbishment, is designed to quickly connect people to Metro rail and transit stations, a new consolidated rental-car center and parking garages. The passenger expansion is geared with an eye towards the 2028 Olympics, which Los Angeles is hosting.
Street and lane closures for guideway construction along Century Blvd. will make access to facilities along that roadway more difficult, Landon said.
Meanwhile, the airport is taking space from cargo areas to build the train. Mercury Air Cargo has already surrendered about 33,000 square feet of its warehouse and relocated in August to a facility previously leased by Swissport, Mercury Chief Operating Officer John Peery confirmed in an email.
Listen and Vent
The Airforwarders Association and the Los Angeles Air Cargo Association on Tuesday evening, Sept. 24, are holding a town hall event to help stakeholders understand how the LAX renovations may impact cargo operations and how to work together to keep cargo moving smoothly. Representatives from the forwarding, airline, ground handling and trucking industries will be represented on the panel. Officials from Los Angeles World Airports and its outside development consultant, Landrum & Brown, are also expected to participate.
Nearly 200 people have registered for the event, forcing it to be moved to a larger facility. Many will come seeking answers from LAWA.
“There’s no single, easy fix,” said Landon, who in his day job is station manager for Transgroup Global Logistics.
In the short-term, facility operators can start by breaking down cargo and staging it before trucks arrive, having more forklift drivers and other personnel on hand, and using technology to create appointment systems, local logistics specialists say.
Air cargo warehouses need to follow the lead of L.A.-Long Beach marine terminals and implement appointment systems where freight documents can be electronically uploaded in advance and truckers can be notified when their shipment is ready for pick up, or make a reservation for a dock door, some suggest.
Griley, who can have up to 20 trucks recovering and dropping freight at the airport each day, said during an interview Friday that a truck of his was stuck at Air China’s facility for four hours after arriving at 6 a.m. even after notifying the facility the evening before about its planned arrival and sending paperwork by email.
“They could have had the freight sitting there all ready to go, shove it on our truck and we could have gone. And we wouldn’t be tying up a dock door, creating a longer line for the people behind us. And it’s all because the freight wasn’t ready, or they didn’t tell us the freight wasn’t ready,” Griley complained.
The lack of coordination within the supply chain means “everything becomes like a fire drill,” said Peter Gruettner, owner of Extra Logistics in Lakewood, Calif.
With crowded warehouses, airlines and their handlers have cut back free time to two or three days, which means forwarders often end up having to pay storage fees if cargo is not picked up within the window. The fees can kick in, for example, If a truck driver arrives late within the pick up window and gets rejected at the gate for not having fully accurate documents, or because there was some unplanned billing charge. The driver then has to go get the new document packet or waste time on the phone with the forwarder trying to resolve the situation.
Gruettner says that’s why he uses a limited number of experienced drayage companies who know the ins and outs of the air cargo business at LAX.
Some facilities are trying to automate the appointment system. Mercury Air Cargo, for example, has implemented a tool from Cargo Sprint that allows drivers to schedule pick ups and be assigned dock doors over the web. It is aiming to require appointments for all inbound moves as of Oct. 1, Cargo Sprint CEO Joshua Wolf said.
“We’re hoping that all the other airlines will take notice of it and generate their own programs,” Griley said. Worldwide Freight Systems, for example, is trying to process freight as best it can, but doesn’t have any plans to add a digital appointment system, he added.
WFS did not respond for comment by press time.
LAX has not built any new cargo facilities since the early 1990s and some of the buildings date back to the early 1950s. Most of the facilities can’t easily accommodate today’s larger aircraft and many are converted hangers with only one entrance/exit and deep space, which contributes to logjams.
Modern cargo facilities, by comparison, have at least two openings and are narrower so that cargo doesn’t have to move far to reach a truck or plane.
The regional airport authority has laid out a tentative plan to tear down far-flung cargo facilities and replace them with a giant two-story building that more than doubles existing warehouse space to 450,000 square feet. It would be the first-ever vertical cargo facility in the U.S. A year ago, it issued a request for proposals for parties interested in designing, financing, building, marketing, operating and subleasing the so-called Century Cargo Redevelopment project, under a public-private partnership model.
But officials now indicate the project has been postponed for at least two years, putting any final construction well into the future.
“LAWA is considering the replacement of aging cargo facilities with a consolidated and integrated air cargo complex. In order to ensure proper coordination with other LAWA development projects and to better align it with the multiple mega projects currently in process at Los Angeles International Airport, we expect to begin the initial planning of a future cargo project in 2021,” Director of Public Relations Heath Montgomery said in an email.
“With this project, LAWA will seek to inspire innovative technologies and state-of-the- art handling systems, and to otherwise leverage private sector expertise to explore the transformation of the air cargo infrastructure at LAX. LAWA expects its new air cargo solutions to be next-generation facilities, building upon recent pioneering innovations in the industry,” he added.
No explanation for the change was given.
Air cargo stakeholders feel they’ve waited long enough.
The city of Los Angeles has made massive investments on the passenger side, but “zero dollars are going into cargo warehouse development despite the fact that there are 14 new carriers flying into the airport,” Mercury’s Peery said in a blog post in 2017.
Two years later, it seems, not much has changed.