By Jennifer Chang    Photo：CANVA

When the transportation industry faces issues such as natural disasters, strikes, or shortages, cargo charter services become a quick and flexible solution. Renting an entire aircraft gives businesses more decision-making power, such as choosing transport locations and scheduling times, enabling them to respond flexibly to various cargo demands. For example, during the COVID-19 pandemic, the global demand for cargo surged, and charter services provided timely logistical support, helping businesses quickly meet market needs. This flexibility makes charter transportation an ideal choice in uncertain environments.

There are two main types of charter flights: full charter and partial charter.

1. Full Charter service refers to an arrangement where an airline leases an entire aircraft to the charterer based on a prior agreement, allowing for the transportation of goods from one or more airports to a specified destination. This mode of transport is highly efficient and flexible, making it particularly suitable for large cargo shipments. Before proceeding with charter shipping, the charterer usually needs to contact the airline at least one month prior to the scheduled cargo shipment. This allows the airline to arrange the transport plan properly and to apply for the necessary transit or entry permits from the relevant departure and arrival airports, as well as governmental authorities. Such advance arrangements help ensure smooth transportation and avoid unnecessary delays. The costs for chartering are typically negotiated based on international market supply and demand. Generally, the freight charges are calculated at a fixed rate per flight kilometer. Additionally, if there is available capacity, a charge of 80% of the per flight kilometer rate may apply. Therefore, when choosing charter services for large shipments, it’s advisable to aim for cargo on both the outbound and return trips, as this can significantly reduce transportation costs. Conversely, using one-way transport will generally result in higher freight charges.

2. Partial Charter service refers to a situation where several air cargo companies or shippers jointly rent an aircraft, or where an airline sells separate cargo space on a single aircraft to multiple air cargo companies for transporting goods. This method is particularly suitable for those who cannot fill an entire aircraft but still have significant cargo needs. The transportation time for partial charters is typically longer than that of scheduled flights. Although partial charters have a fixed timetable, the actual departure times may be affected by various factors, leading to potential delays.

Charter service offers many clear advantages. It effectively addresses the issue of insufficient cargo space on regular flights, ensuring that goods can be transported in a timely manner to meet market demands. Additionally, since all cargo is transported by charter, this eliminates the complexities of multiple shipments, significantly saving transportation time. Moreover, the use of full charters can fill the gaps left by direct flights, avoiding the hassles of transfers and reducing the risk of loss, damage, or misplacement of goods during transit. During peak air cargo seasons, charter services can also effectively alleviate the pressure on flight availability, especially for specific cargo needs such as seafood and live animals.

The disadvantages of charter service should not be overlooked. Compared to other transportation methods, the cost of international air charter service is generally higher. This can particularly be a factor for some customers when transporting large volumes of cargo, as the high air freight costs may lead them to consider alternative shipping options. Weather conditions have a significant impact on air transportation; adverse weather can result in flight delays or even cancellations. These uncontrollable factors can introduce a certain level of uncertainty into charter shipping, especially in regions where severe weather is frequent.

Although most companies don't consider charter services a long-term solution, charter transportation provides an efficient and flexible logistics option. It is particularly suitable for goods that require fast and secure transport. If a company faces time-sensitive demands, charter transportation is a viable option to consider.

Appreciate if you could share TGL Blog among your friends who are interested in first-hand market information of supply chain and updated economic incidents.