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Responses of air cargo carriers to industrial changes

Author

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  • Hsu, Chaug-Ing
  • Li, Hui-Chieh
  • Liao, Patty
  • Hansen, Mark M.

Abstract

This study examines how product characteristics, values, inventory cost, shipping charges, shipping distance, and time affect an international firm's choice of air carrier. An individual choice model is constructed by assuming that the shipper in a specific industry chooses the optimal air cargo carrier with the minimal logistics cost. The study further aggregates air cargo demands on different routes for the carriers by considering the spatial distribution of the origin-destination pattern and any temporal changes in the industrial structure. A case study is used to illustrate the application of the proposed model using data from Taiwan Taoyuan International Airport and the industrial economics database in Taiwan. The results show that shippers with high product value and short delivery distance focus on the shipping charge and prefer choosing the air cargo carrier that offers more flights. Further a carrier may achieve a larger market share if its supply attributes match the industrial structure and the product characteristics of the market on the route. Finally, because dynamic changes in the industrial structure and product value have been captured, the results are more accurate than that from the Grey model.

Suggested Citation

  • Hsu, Chaug-Ing & Li, Hui-Chieh & Liao, Patty & Hansen, Mark M., 2009. "Responses of air cargo carriers to industrial changes," Journal of Air Transport Management, Elsevier, vol. 15(6), pages 330-336.
    • Handle: RePEc:eee:jaitra:v:15:y:2009:i:6:p:330-336
    DOI: 10.1016/j.jairtraman.2009.06.002
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    References listed on IDEAS

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    1. Chin, Anthony T.H & Tay, John H, 2001. "Developments in air transport: implications on investment decisions, profitability and survival of Asian airlines," Journal of Air Transport Management, Elsevier, vol. 7(5), pages 319-330.
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    Cited by:

    1. Shiao, Guo-Chou & Hwang, Cherng-Chwan, 2013. "Analyzing competition of international air cargo carriers in the Asian general air cargo markets," Transport Policy, Elsevier, vol. 27(C), pages 164-170.
    2. Huang, Show-Hui S. & Tseng, Wen-Jui & Hsu, Wen-Kai K., 2016. "An assessment of knowledge gap in service quality for air freight carriers," Transport Policy, Elsevier, vol. 50(C), pages 87-94.

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