![[Valid Atom 1.0]](valid-atom.png "Validate my Atom 1.0 feed")
Cargo's Defense * USA - The Pentagon's logistics planning means greater opportunities for the cargo industry
War has proved to be big business for American (air &) freight companies serving military needs
Washington,DC,USA -Air Cargo World, by Michael Fabey -2 June 2008: -- Lifted by battle-surge needs in Iraq and Afghanistan, the U.S. Defense Department-related air freight industry expenses have been boosting the revenue of carriers and forwarders moving that freight... The DOD is now looking to companies like Menlo Worldwide Government Services for logistics aspirin... Last fall, the Pentagon signaled its intentions by awarding a domestic cargo forwarding contact to Menlo. It was initially worth more than $500 million but had a total estimated value of more than $1.6 billion... The contract represented a major shift in how the Pentagon views its logistical needs. Historically, the DOD has left it up to defense contractors to manage freight shipments in subcontracts with various forwarders or other transportation companies... Before the freight was offered under one contract, about 60 percent of it had moved by less-than-truckload, almost a third by air and a 10th by truckload... The Menlo contract is just an appetizer for the Pentagon, which has a much bigger spread for its transportation needs. The DOD needs to ferry freight on a daily basis, from equipment troops need in battle to the raw materials needed to manufacture those machines to the men and women manning them... Of the $515.4 billion requested for the DOD in the Bush administration's fiscal year 2009 budget request, about $158.3 billion, or nearly a third, is for support, readiness and operations, including logistics needs... The biggest air carrier is FedEx, with about $1.3 billion worth of contracts, though, the company points out, some of those transactions concern other airlines under the general FedEx deal... Evergreen International flies in a close second with about $1 billion while UPS brings up a distant third with about $128 million... The total of all "transportation" costs - the kind of contract historically and traditionally awarded to about 130 companies such as Menlo - is about $227 million. The top contractor, excluding Menlo, for the work in 2007 was American Auto Logistics, with six transactions worth about $197 million in all... The average cost per contract or modification for the group was about $335,000 and the median per-transaction cost was about $17,292... In accepting the contract, however, Menlo officials acknowledged the biggest challenge would be mediating the different cultures of the commercial and military worlds... Transportation companies, which often boast of their abilities to bend the rules to cut costs or time, will have to stay more inside the box...Labels: trucking industry news USA
posted by Unknown @ 6:03 AM
0 Comments:
Post a Comment
<< Home