Do we remember that postal mail was at the origin of the commercial aviation? One hundred years ago, intercontinental routes opened one after the other and the first things the planes were bringing across the oceans were mail dispatches. From the very beginning of the commercial aviation, the founding fathers of our industry decided that mail and cargo were two separate products. Thus, postal mail, which at that time was mainly composed of letters, was due to be carried under the Universal Postal Union documentation while the Airway Bill was created for cargo during the Warsaw Convention in 1929.
Both systems have been intensively used by airlines for decades. The old postal document AV7 has been replaced by the CN38 but its structure remained the same. For cargo, millions of AWB are issued every year. But as from the end of the last century, came numerous unexpected challenges with the digitization.
The difference between a postal CN and an AWB are so huge that electronic systems cannot properly handle both standards in a single way. More and more airlines become reluctant to carry mail under CN as they do not want to allocate resources to manage a product which is not booked, not integrated in the cargo system and which is following some specific processes. The AWB is a contract while the CN is a simple purchase order. Therefore, liability rules and conditions of carriage differ significantly from one environment to the other. From the procurement to the operations and the invoice settlement, mail can be difficult to handle for an airline, a freight forwarder or a general sales agent. On the other side, posts often need to understand how a carrier is working to optimize their procurement and operations. The international transport operations are the largest source of non quality of the end-to-end postal process. International transport is too often considered by posts as a mandatory cost and not enough as a leverage of quality improvement.
When it comes to mail, many airlines chose the easiest way consisting in refusing to carry or simply adding an AWB on top of the mail consignment. However, such practices prevent the posts to correctly monitor their activity and can even drive some of them to restrict the range of their services. Today, after almost a century of mail carried under UPU rules, a significant number of industry specialists foresee the soon end of the postal transportation standards. In some parts of the world, they are already not even applied. But the posts need these standards for their process efficiency. The recent boom of the e-commerce brought to the postal industry an unexpected opportunity to balance the long but certain decline of the standard letter mail. More than sixty percent of the items purchased online are still delivered by the legacy postal operators, offering them a chance to benefit from this growing market. Meanwhile, e-commerce brings to air cargo a new range of possibilities. It is obvious that postal and air cargo industries need, more than ever, to build some bridges for their mutual benefits.
Incorporated in 2020, Leg-2.com has been created with the ambition to build some bridges between the air cargo and the postal industries. “It is indeed possible to carry mail as cargo” – says Luc Larrieu-Sans, founder of Leg-2.com – “the most challenging part being to convince the stakeholders to think out of the box. There is no value to consider an opposition between a CN and an AWB as these two standards can have some complementarities”. Leg-2.com is proposing some consulting and training services to airlines and postal operators wishing to have a better understanding of their commercial partners.
On top of its consulting and training activities, Leg-2.com is also offering some EDI services, thanks to its partnership with Airmail Data, a French IT supplier which started its activity in the air cargo industry by providing an easy AWB issuance platform for small and middle size freight forwarders (click here). Leg-2.com and Airmail Data are working together to bring satisfaction to posts and carriers by providing them the necessary tools to enhance their collaboration.
There are indeed some solutions to align mail and cargo processes and to bring the possibility to carry mail as cargo in compliance with the UPU standards. One of these solutions is based on the postal AWB concept, jointly designed by the Universal Postal Union, the International Post Corporation, and IATA. The postal AWB is not a new document or a new EDI message. It is an AWB number associated to a postal message, the common denominator enabling the postal data to be converted into cargo messages. The postal AWB concept is the missing link between mail and cargo.
A postal CN can be electronically translated into a CARDIT message. Almost all the posts in the world know how to send a CARDIT, giving a chance to carriers to receive all the relevant information necessary to prepare and operate a flight. There are not so many industries where the client can digitize so easily its information. This set of data can be processed and used by the airlines to correctly handle and manage their operations and even to use the postal CN into their cargo system. Despite the differences existing between the two documents, some business rules have been designed by the industry bodies, enabling a data mapping between the UPU and IATA standards. This mapping allows to populate the mandatory fields of a FWB and an FHL. From there, the carriers can manage the mail consignments in their cargo system such as if the physical flow were coming from a standard customer. Assigning an AWB number to each CARDIT is obviously necessary and can be done either by the post or the airline. It is however true that this assignation will be hardly made by the posts and in most cases, the airline has to manage itself its stock and assignation of AWB numbers.
Many stakeholders expressed their concerns on the postal AWB concept, arguing that the high amount of postal CN will mandatorily create some issue because of a potential lack of available numbers. The International Post Corporation and IATA have addressed this concern and proved that the largest carriers handle a maximum of 500.000 CARDIT per year, far less than the maximum amount of 9.999.999 available numbers per year. Most of the airlines will never need more than a couple of thousands of AWB numbers per year.
There are several mutual advantages of using the postal AWB concept. The first one is to encourage the postal operators to close their consignments in line with agreed allocations. The second one is linked to the improvement of the process efficiency: Capacity can be managed and the lack of communication between mail and cargo systems can be eliminated. Any FSU message can indeed be converted into a postal RESDIT to provide the posts with the return of information they expect. Not all the FSU messages refer to an operational event having a relevant meaning for the posts. But on most occasions, the common events reported for the cargo have a correspondence in the postal environment.
The third advantage is related to the regulatory compliance. As from March 2023, the European Union will include the mail flows in its import control system (ICS2) regulation, making mandatory a pre-departure notification by the carrier for any mail consignment containing goods and shipped to the EU territory. No doubt that the principles of such a legislation will be followed by other political entities. The e-commerce expansion implies too many bilateral exchanges which cannot be ignored by the custom border agencies for taxation and security purposes. IATA and the UPU have diligently work together these past years to design the most appropriate model enabling to convey the data to the custom agencies. Named “the global postal model”, this concept outlines the obligation for the airlines to push the data to the customs authorities before the actual departure of the aircraft such as it is made for cargo in many countries.
Posts and airlines will therefore very soon need to assess their collaboration and bilaterally decide how they wish to continue to work together in this changing regulatory environment. Several alternatives to the global postal model can be imagined, but so far, the postal AWB concept is certainly the best way to match the regulatory requirements while respecting the operational and financial constraints of both parties.
An efficient IT integration is obviously a key success factor, and therefore Leg-2.com built with Airmail Data, a reliable internet platform offering the airlines to get connected to the postal EDI network and to interface the data with any cargo system using Cargo-IMP or XML standards. Cost efficient, easy to use and to interface, Airmail Data offers its customers the possibility to fully integrate their mail activity. Providing an IT solution is one thing, accompany the client to help him understand this complex and fast-moving environment is another thing. “Airmail Data is the result of a strong collaboration between internet and data exchange specialists, driven by the expertise of Leg-2.com, founded by Luc Larrieu-Sans, former International Transport Director of the French postal operator and ex member of the IATA-UPU Contact Committee. Therefore, we can offer not only a technical solution but also a full accompaniment and understanding to any carrier wishing to strengthen its mail capabilities” says David Alonso, founder of Airmail Data.
This joint venture also brought some innovations on this specific market. The application can run with five different modes of data capture and is still young enough to adapt itself to some customer specificities. Launched in 2020, Airmail Data is already used by six major carriers, one of them being… a road carrier, because the challenges raised by the e-commerce expansion do not only concern the air. To our knowledge, it is the first time ever that a road company has the capability to exchange transport data with a postal operator in the UPU EDI network.
Airmail data is also able to include freight forwarders or general sales agents in this postal environment. It is true that the postal EDI concept has been primary designed to function between posts and airlines, but our modern world cannot ignore that a significant part of the mail bookings and allocations are made through third parties. Therefore, there is no reason to let the mail EDI practices out of this business environment. Mail is obviously a special product, and the industry must respect this, but it does not mean that we all need to continue to manage it as we always did. The inclusion of freight forwarders or general sales agents in this ecosystem is a wonderful opportunity for the industry, paving the way to innovation.
At last, Airmail Data is the unique postal EDI solution to run under a subscription concept. No structural IT integration, no costly license acquisition, it is a “pay as you use” solution. The carrier can be engaged for six months or ten years in the mail business, it can jump in and out whenever it is needed. “It was important for us to break this structural investment barrier. In my previous position, many airlines told me they could not engage such high investments without long term guarantees. With Airmail Data, they can now consider satisfying the postal operators at no risk” says Luc Larrieu-Sans.