Air Cargo Consolidation: Faster Shipping Without Breaking the Bank

Air cargo consolidation service is ideal for shippers seeking faster delivery times without incurring the full costs of air freight. The strategy combines multiple shippers’ cargo moving to the same place. All participating shippers pay a premium for faster shipping versus ocean freight, but they save by sharing the costs. This article tells you everything you need to know about consolidated air cargo service, from how it works to the benefits it offers and how to choose the right freight forwarder to implement this cost-saving strategy.

What is Air Cargo Consolidation?

Air cargo consolidation is a logistics strategy that combines shipments from multiple shippers into one consolidated load for air transport. For global shipping, it’s the least expensive air freight shipping option for companies who’ve decided they can’t afford to have customers wait weeks to receive goods via more economical container shipping. By sharing space and costs, businesses can enjoy the speed of air freight shipping at a reduced expense.

Consolidated air cargo loads can move on cargo planes or passenger planes. This allows freight forwarders to leverage a broader network of flights, increasing flexibility and cost efficiency. The only caveat: larger equipment may not work for passenger planes given the comparatively smaller dimensions of loading doors.

What Are the Different Types of Air Freight Shipping Options?

From most expensive to least expensive, here are typical air freight options:

1. Air Cargo Charter Service. This is the most expensive option for your larger-volume, urgent freight. You’re basically renting an entire plane to provide guaranteed service on a set schedule. A less expensive shared charter service may also be available from a freight forwarder that books a regular charter flight to satisfy a high-demand lane and makes that space available to multiple shippers. Dimerco did this recently with a Shanghai-to-Chicago air cargo charter flight to address a peak season capacity crunch. In another example, we quickly arranged emergency charter service for a Fortune 100 brand that saved the company millions in excess tariff costs.
2. Express and Next Flight Out (NFO) Service. This is the next rung down from charter service in terms of cost. It’s a premium service for time-critical freight with 24-48 hour transit time within Asia and 72 hours to other global destinations.
3. Standard Air Freight: This is the most popular type of air freight service. It involves single shipments sent individually to meet your service-level requirement, getting them there faster than non-air-freight options.
4. Deferred Air Freight. If your freight is not urgent, deferred air freight will be a cost-effective option. Standard air freight has higher priority for loading on flights vs. deferred air freight, which might be bumped for more urgent shipments.
5. Air Cargo Consolidation: This will likely be your cheapest air freight shipping option since you’re sharing the costs.

Air cargo consolidation fits best for businesses with smaller shipment volumes that still require fast delivery.

What are the Benefits of Air Cargo Consolidation?

1. Cost Savings vs. Other Air Freight Options. Shippers pay only for the space their goods occupy, splitting costs for fuel, handling, and transit fees. How much you’ll save will depend on factors like shipment size, destination, and the freight forwarder’s network. Shippers can often save up to 30%-50% compared to individual air freight shipments, making it a cost-effective choice.
2. Speed. While slightly slower than dedicated air freight, consolidated shipments still move much faster than sea freight for global shipments.
3. Reduced Risk of Damage. The likelihood of freight being damaged is higher with ocean freight vs air. Consolidated air cargo loads are handled less frequently than sea containers. Also, they won’t be exposed to the hazards of long sea journeys.
4. Reliable Delivery. Freight forwarders specializing in air freight consolidation use established networks and schedules, ensuring consistent, predictable delivery times.
5. Customer Satisfaction. Customers who don’t have to wait long to receive their orders are happier. And the likelihood of delays at airports is much less than at seaports.

How Does Air Cargo Consolidation Work?

Here’s a step-by-step look at how air cargo consolidation services are managed:

1. Shipment Collection. Freight forwarders gather shipments from various shippers, typically bound for the same destination. Freight is then sorted and grouped based on destination, weight and size.
2. Shipment Consolidation. At the freight forwarder’s warehouse or consolidation hub, shipments are packed together to optimize space. Each shipment is documented under a House Air Waybill (HAWB) for individual shippers, while the consolidated load is documented under a Master Air Waybill (MAWB).
3. Transport to the Airport. The consolidated shipment is transported to the airport for loading onto a cargo or passenger aircraft. The right forwarder will ensure all necessary paperwork, including customs declarations, is meticulously checked to prevent delays.
4. Air Transport. The consolidated load travels as a single shipment to its destination.
5. Customs Clearance. At the destination airport, Customs agents process the consolidated shipment. The MAWB governs the overall load, while individual shipments are cleared using their respective HAWBs.
6. Final Delivery. The forwarder picks up the load and deconsolidates shipments at a container freight station near the airport. It then delivers the different shipments to the respective consignees. Check out this short air freight deconsolidation video on how Dimerco works with a Fortune 100 tech company to deconsolidate and deliver its China-to-US air freight shipments within 24 hours of touchdown.

Who Uses Consolidated Air Freight Services?

The strategy is most popular with businesses that have regular smaller shipments who are looking to minimize shipping expenses, while maintaining high service levels. Sectors where air cargo consolidation is common include semiconductors, medical devices and other industries that feature high-value goods.

How Does Customs Clearance Work with Consolidated Air Freight Shipments?

Customs clearance for consolidated shipments is streamlined through the MAWB. Individual shipments under HAWBs are processed separately but benefit from the coordinated efforts of the freight forwarder to ensure quick and efficient clearance. The specific clearance process will vary by country.

How Can a Freight Forwarder Help Reduce Your Costs with Air Cargo Consolidation?

Freight forwarders negotiate bulk rates with airlines and leverage their expertise in consolidation to minimize shipping costs. They optimize space, handle documentation, and manage the entire process, ensuring seamless transport while keeping expenses low. Dimerco, for instance, manages large volumes of freight moving around the world and can leverage that volume to offer attractive rates for consolidated air cargo shipping. The company is particularly strong with shipments moving to and from Asia-Pac.

Can Consolidated Air Freight Be a Viable Alternative to LCL Shipping via Container?

Because of geopolitical and other issues, the cost of shipping a container has been very volatile in the past few years, to the point where the delta between shipping via sea vs air has really contracted. Still, you will always pay significantly more for any type of air freight.

Consolidated air cargo is the preferred option for time-sensitive goods, while LCL shipping is better for lower-cost, less urgent shipments.

What Criteria Should You Use to Choose a Freight Forwarder for Air Cargo Consolidation Services?

1. Experience in Air Cargo Consolidation. Look for a freight forwarder with proven expertise in air cargo operations. For example, Dimerco has been named a Top 10 Asia-Pac 3PL based on air freight volume (Armstrong & Associates).
2. Strong Air Freight Capacity at an Affordable Price. Air cargo space can be difficult to find. It’s best to work with freight forwarders that have pre-purchased Block Service Agreements (BSAs) with key airlines serving your lane and can, therefore, offer the affordable capacity you need.  For instance, they may have a fixed schedule with weekly service between Asia and major U.S. and European gateways.
3. Global Network. A strong network of airline partnerships and consolidation hubs ensures efficiency and reliability. If your forwarder operates its own offices at origin and destination, it allows them to seamlessly manage your shipment from door to door. For instance, Dimerco’s offices across North America work closely with 130 Dimerco forwarding offices across Asia to coordinate air shipments using a single global operating system.
4. Transparent Pricing. Choose a partner that offers clear pricing without hidden fees.
5. Excellent Customer Service. Responsive communication is essential should questions or issues arise. You’re shipping via air because it’s important cargo that needs to get there quickly and reliably. You don’t want to work with a forwarder that doesn’t return phone calls or emails in a timely manner,  or routes your inquiries to inexperienced Customer Service Representatives who don’t know your situation.
6. Fast-acting, flexible approach. Ideally, you want a forwarder that combines the global freight network and strong air freight capacity of a larger forwarder with the fast, flexible working style of smaller 3PL. That’s not easy to find, but the service side is critical should a disruption require urgent contingency planning.
7. Customs Expertise. Your freight forwarder should have a deep understanding of customs regulations to handle consolidated shipments smoothly. Look for a partner that is certified as an Authorized Economic Operator (AEO) in the country you are shipping to. AEO status signals to Customs authorities that the 3PL has met rigorous standards for supply chain integrity. The designation can cut clearance time significantly.  Dimerco has achieved the highest level of AEO certification in China and enjoys similar AEO status in most countries in its global freight forwarding network.

Looking to Explore Consolidated Air Cargo Shipping?

Air cargo consolidation is a strong option for businesses aiming to balance cost and speed in their shipping operations. By partnering with the right freight forwarder, companies can unlock the full potential of air freight consolidation services  to reduce costs for critical shipments while meeting customer expectations with confidence.

Want to discuss whether consolidated air cargo services are right for your operation? Contact a Dimerco freight specialist today to start a conversation.