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Airlines are set to make increasing use of road feeder services across Europe

Published on 2009-02-18 being readed 1700 times

But according to one of Europe’s biggest providers of airline trucking services, the carriers should not be looking to reduce costs by forcing the truckers to cut their prices.

Instead, argues Bauke Felix, managing director of Rutges Cargo, carriers should be working towards creating new longer term partnerships with their trucking partners in Europe.

"It is relatively easy to force any supplier to cut their prices, but far greater bottom line benefits can be derived from joining forces and using the combined knowledge and expertise of both partners to find a better way of doing things."

He believes it is a message that is getting through to the airlines.

"We are now seeing more airlines from around the world wanting to sign longer term contracts with us to ensure continuity of service. As carriers switch to operating smaller aircraft and cutting frequencies, the need for a reliable trucking partner also increases."

But Amsterdam-based Rutges has not been waiting for the message to trickle through to the airlines. It has been on the road to make sure the message gets out.

In particular, the company has mounted a, "hearts and minds" campaign in Asia to explain to the region’s carriers just how effective and reliable intra-European road feeder services are as an adjunct to line-haul services.

"It was really an education exercise to explain just what degree of control we have over cargo moving through any part of our European network," says Jason Breakwell, commercial manager of Rutges Cargo.

"It soon became evident with each carrier we spoke to that our strongest selling point was our ability to provide EDI messaging, full shipment visibility, status reports and delivery confirmation across our entire network."

As a result of that Asian education program in the past 12 months, Rutges Cargo has succeeded in winning contracts from China Southern, Eva Air, Jade Cargo International, Jet Airways, Malaysia Airlines and Singapore Airlines.

According to Breakwell most of the new Asian contract signings are looking to gain greater penetration of the Eastern European market as a means of adding value to their business.

"What we were also able to demonstrate was how we could help these carriers gain market share and achieve cost savings - and this was even ahead of the recent global downturn," notes Breakwell.

"Several carriers were also keen on our ability to offer a deferred service, which can often be appealing because an extra 24-48 hours transit time for some shipments can result in savings up to 15 percent."

On the other hand, operators like Rutges Cargo are attracting business by the increasing product range of premium services they are able to offer customers. For example, over 90 percent of Rutgers’ trucking fleet is now fitted with temperature control technology.

"This provides us with the opportunity to offer strict temperature control not only for fresh produce, but also for pharmaceutical products," says Breakwell.

Rutges is also achieving a strong reputation for the shipment of high value products across its network. Its Secure product offers GPS vehicle tracking, emergency response, risk assessment and risk management solutions.

"We have reached point now where we are quite prepared to turn down business if a customer does not accept our risk assessment for handling high value shipments," says Breakwell.

The Rutges reputation for handling valuable and vulnerable traffic has been further enhanced after the company gained the Transported Asset Protection Association (TAPA) Freight Security Requirements (FSR) ’A’ certification for its secure warehouse operation at Amsterdam Schiphol airport - the highest certification achievable.

"But we know we can never be complacent about security issues and are constantly looking at ways to increase our vigilance and reduce the risks still further where necessary," explains Breakwell.

For example an armed security guard will accompany any Rutges truck in transit through Russia.

Rutges Cargo may have succeeded in avoiding direct pressure from the airlines to cut the cost of services it provides, but it knows it still needs to seek greater operating efficiencies. With a fleet of more than 200 vehicles, that includes reducing the company’s carbon emissions.

One of the most effective efficiencies achieved, according to Bauke Felix has been the investment in over 50 double deck trailers.

"This has effectively halved the number of trucks on some routes in Europe, with each of the mega trailers able to carry up to 66 Euro pallets, a 50 percent increase compared to single deck vehicles."

In addition, Rutges is also investing in a fleet of new low-emission vehicles. Within the next five years it anticipates that its entire fleet will run on bio-fuels, as new vehicles are introduced and older trucks converted.

At the same time the company has also invested heavily in advanced capacity planning software to improve the utilization of the fleet.

"This has already seen a reduction in the number of vehicles, ’empty running’ by more than 20 percent," claims Felix.