THE GLOBAL SUPPLY CHAIN DISRUPTION – RICH PASCHALL

Now that supply and delivery logistics are breaking down throughout this country and the rest of the world, this might be something to which you might want to pay attention.


The Pandemic Problem, by Rich Paschall


Arriving at Chicago O’Hare

It is a lot quieter at the airport these days. There are few passengers, therefore fewer flights. The drop off is significant. The reductions will continue, not just because of a fear of flying by the public, but also because of the restrictions put into place by countries around the world.

After over 30 years in the freight forwarding industry, I joined an airline last year. I have been working for Air Canada at Chicago O’hare International Airport. ORD is one of the busiest airports in the world. In fact, it has been ranked 6th in recent years. There were over 83 million passengers served at ORD in 2018.

On Friday of last week, we were told to take home our laptops and whatever else we needed and not come back until told to do so. My “office” unfortunately is now less than 15 feet from my refrigerator. I’ll survive.

About Air Canada

Here is a little info on the company from a press release issued Wednesday. I tell you this not as a company promotion since you aren’t going anywhere, but so you will understand the problems that lie ahead:

Air Canada is Canada’s largest domestic and international airline serving nearly 220 airports on six continents. Canada’s flag carrier is among the 20 largest airlines in the world and in 2019 served over 51 million customers. Air Canada provides scheduled passenger service directly to 62 airports in Canada, 53 in the United States and 101 in Europe, the Middle EastAfricaAsiaAustralia, the CaribbeanMexicoCentral America, and South America.

Needless to say, they have an extensive schedule. Unfortunately, I can not read the flight cancellations fast enough. Many weeks ago we stopped flying to mainland China. Flights to Seoul, Korea, and Hong Kong have been cut by more than half.  The extent of the outbreak in Italy stopped flights to Rome and delayed the return of the Air Canada Milan flight. Other lanes have stopped or will stop.

You will notice above that not counting the USA and Canada cities, there were 101 international airports served, most with wide-body aircraft. By the start of April, that will be cut to 6.  SIX! We know passengers don’t want to fly.  All airlines are cutting flights. But what about your freight?

Freight Forwarding

To simplify the explanation, I used to tell people that a freight forwarder is like a travel agent for your freight. It is a lot more complicated than that, but it is the best I can do.

ORD is quiet now

There are a lot of regulations and hence a lot of paperwork to complete. Since 9/11 and the “known shipper” rules, it became more complicated. Follow that with a realization made a few years ago that we really ought to be screening freight because we screen all passengers. This made the challenge greater.

I would tell people if they have a package of a few pounds and of low value, they ought to call UPS or FedEx or even take it to the post office. If you have a thousand pounds, the first two might take it at a high price, the last, probably no chance at all.

So how do all these goods get around the world? If they need a thousand widgets in Lyon, France and you have to get it there in a few days, there are a number of airlines that could help. They could fly to Paris and truck to Lyon. Yes, most airlines have a trucking network in place. That allows them to get to most major cities in the country to which they fly. When you consider “interline agreements,” some airlines can take your freight almost anywhere in the world. Air Canada does not serve Antarctica, but they are working on plans to serve the more remote places in Canada.   Think drones.

Belly Space 

If you ever gazed out the window while airline handlers were loading an aircraft, you may have noticed that they were not just putting baggage on board. On the widebody international flights, up to two-thirds of the belly space could be filled with cargo. Multiple positions could hold boards of freight (airline pallets) that are 125 inches long by 96 inches. Stacking the freight up to 64 inches high you could get up 4000 kilos (8800 pounds) in each spot. Yes, that’s a lot of cargo.

Chicago Department of Aviation says ORD handles “just under two million metric tonnes of cargo per year.” Consider all the large airports in the USA, Canada, and Mexico. They are all sending out goods and bringing goods back. The supply line is about to be slowed to a trickle. As plants shut down around the world, fewer goods will be shipped.

Now we are in the unfortunate position of turning away cargo for lack of flights to some areas. Soon the number will choke industry. Remember the numbers above. One hundred and one airports served are now cut to just six. USA and Canada service will also be curtailed. How will our goods get to foreign customers? How will their goods get to us?

The Darkest Days

How can we keep everyone working when there is little work? How does a factory work if it can not get its supplies? Many may want to ship us goods, including food, but how will they get in if we close the borders?

The darkest days are ahead, that’s for sure. I am not trying to scare you to death, although you should be scared. Conserve. Be safe. Wash your hands. Stay home as much as possible.

Leaving on a jet plane

After the darkest days and nights will certainly come the dawn. We survived the slow down that followed 9/11. We had days of no flights and then a slow return. This will be longer, but the return to normal will come.

The sun will shine for you again. In order to help you with that, I am lining up sunshine songs for Sunday.  Seriously.

Come and sing along with us. At a social distance, of course.



Categories: Airplanes and flying, Rich Paschall

Tags: , , , , , , ,

19 replies

  1. Reblogged this on rjptalk and commented:

    In case you missed it, we shared some thoughts recently on SERENDIPITY about the supply chain and how the current situation affects us all. The repairs to the links in our supply chain will be slow. Be sure to click on “View original post” at the bottom to head over to teepee12.com for the rest of these thoughts.

    Like

  2. This is an interesting post, Rich. I more or less knew this but it is a bit of a shock to read it in black and white like this. It makes it more real if you understand what I mean. I am well aware of the supply issues the world faces and find it strange that other people don’t seem to realise these things, or the fact that if companies are not operating, they will not earn profits or pay tax, if people are not working or even able to shop and spend, the VAT or GST on goods will not be earned by government. Individuals who are not working need to file for government aid but where is all the money going to come from. It is very worrying and I try to keep my thoughts tightly reined in to my day-to-day living.

    Liked by 1 person

  3. Good to get hear this inside story Rich. What a mess.
    Leslie

    Like

  4. what an interesting and important job. stay well and do your best and the sun will return, i’m sure.

    Liked by 1 person

  5. wow that frait forwarding sounds so complicated! I also think its so interesting though to learn more about how its all done. I never realised there was so much work involved. ❤

    Like

  6. There’s a lot of numbers there Rich and it is disturbing. We just can’t freak out about it. Business will come back and hopefully it will be more efficient.
    Leslie

    Liked by 2 people

  7. This is the first time I figured out what freight forwarding is about. It sounds complicated. One little mistake and the cargo winds up who knows where on some continent far, far away. I just hope we get some more toilet paper.

    Liked by 2 people

    • We have freight stuck in transit because some countries have absolutely closed their borders. We were sending a lot to Italy by trucking from Zurich, Geneva of Lyon. Now trucks are not going and some things are stuck in one of those cities. Document errors and/or routing errors can also be a problem.

      Liked by 2 people

      • Rich, interesting detail on freight passage. Really! I came away with one take – from you – during the “Satan Bug” crisis. Robot workers and drones to keep things moving and flying. I’m sure that’s already on the table, yes?

        Liked by 1 person

        • Air Canada has an AI lab in Montreal and is also working with the university there. They have a partnership with a drone startup too. This is not new. They have been aware for sometime that there are many remote areas in Canada that are not well served, particularly in winter. Imagine if they have to use larger drones so people don’t have to tough anything.

          Liked by 1 person

Trackbacks

  1. SENDING AND RECEIVING STUFF – RICH PASCHALL | Serendipity Seeking Intelligent Life on Earth
  2. BRING ON THE FRUITS AND VEGGIES – RICH PASCHALL | Serendipity Seeking Intelligent Life on Earth
  3. WHERE’S MY STUFF? – Marilyn Armstrong and Rich Paschall | Serendipity Seeking Intelligent Life on Earth

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