Mail Barred From Passenger Flights
The Federal Aviation Administration has temporarily banned mail and cargo from all passenger flights, forcing mail delivery onto the ground and delaying checks, bills, documents and other first-class items.
About a quarter of the 650 million pieces of mail that the U.S. Postal Service handles each day has been redirected from passenger planes to trucks, pushing back deliveries by 24 to 48 hours for the foreseeable future, Postal Service spokesman Mark Saunders said.
However, most of the nation’s express mail and cargo--everything from medicine to fresh fish to apparel--that has been grounded for the last two days should be back up in the air today as the country’s largest cargo carriers resume flights.
But analysts and company executives fear that the FAA cargo ban and additional security measures at airports and ports of entry could send shock waves throughout the business community here and abroad.
“If we can’t get this resolved, it will fundamentally change the way we do business. It will put a tax on global commerce because of the precautions that will be necessary,” said Peter Morici, senior fellow at Washington-based Economic Strategy Institute.
FAA officials say the cargo restriction probably is temporary, but some restrictions probably will remain. “I think you will see there will be some specific requirements in the short term, medium term and some long term,’ agency spokesman Allen Kinetzer said.
Companies such as Driscoll Strawberry Associates in Watsonville, Calif., already have felt a sting, losing tens of thousands of dollars in revenue because fresh berries bound for supermarkets around the country have spoiled aboard grounded planes.
Seafood restaurants have for the moment lost their ability to fly in East Coast lobster and fresh fish from around the world.
Companies that rely on the timely delivery of foreign parts and goods have been experiencing hardships.
And department stores relying on just-in-time inventory systems may soon find their distribution centers empty and shelves getting stripped, said W. Guy Fox, president of the Los Angeles Air Cargo Assn. and president of Global Transportation Services, a customs broker and international freight forwarder.
But the banning of freight on passenger flights will have the largest impact on the airlines themselves, which need cargo revenue to boost sagging bottom lines.
“The cargo profit contribution is enormous” and needed in many cases for an airline to post a profit, said Brian Clancy, a principal at MergeGlobal, an Arlington, Va.-based cargo consulting firm.
Trying to offset this loss of revenue by raising fares probably wouldn’t work, especially with people already skittish about traveling, said Ron Kuhlmann, an airline consultant with Roberts Roach & Associates in Hayward, Calif.
The airlines could try to pass along those costs in the form of additional fees or charges, he said, perhaps a “security surcharge” like the energy surcharges of the past. But he said they probably will be forced to simply absorb these losses.
The airlines’ loss, however, will translate into gains for air freighters such as FedEx and United Parcel Service, as well as smaller operators with fleets of 747s.
Passenger flights carry as much as 75% of the cargo to Europe, 35% to the Pacific Rim and 45% to Latin America, Clancy said, and that business will have to be directed to freight-only flights.
Some are hoping the restrictions will boost business at the four cargo-handling airports in San Bernardino and Riverside counties.
“This region really wants to see a good deal of cargo activity transferred here, and it has an enormous capacity to handle it,” said John Husing, an Inland Empire economist.
Husing cited the cargo-handling capacity of Ontario International Airport, along with three airports fully or partly converted from military use: San Bernardino International, Southern California Logistics Airport in Victorville and the March Air Reserve Base in Riverside, which is still partly used by the military.
Husing said air cargo firms have in the past balked at shifting to the Inland Empire airports because they wanted the flexibility of having interconnections with passenger airlines that carry freight.
But if tough long-term restrictions are placed on freight shipments in passenger planes, Husing said, there could be an impetus to move to the Inland Empire.
Not everyone is persuaded of that argument, however.
“It’s not even an issue,” said Fox, who said the costs of such an overhaul would be prohibitive for most companies.
Most are hoping the bans are only temporary, but they acknowledge this turn of events will forever alter the sense of security for businesses as well as passengers.
“In the long term, we’ll go back to a semblance of normality, but it’s not going to be the same,” Fox said.
Times staff writer Evelyn Iritani contributed to this report.
