Managing transportation logistics: anchorage air and see routes offer global economies of scale.

• Author: Bohi, Heidi
• Position: REGIONAL REVIEW

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A prime geographic location, one of the strongest economies in the nation, and the certain boost that will result from improvements to the Ted Stevens Anchorage International Airport and the Port of Anchorage are all factors contributing to the growth of the freight management and logistics industry in Alaska, though this is not to say that it isn't without some challenges that make it all the more interesting.

"When it comes to certain things we're ahead, but because we are separated from the Lower 48 by great distances, very challenging waters and climate, and strict environmental standards resulting from the Exxon Valdez oil spill, it's challenging," says Dr. Darren Prokop, University of Alaska Anchorage, Logistics Department chair.

AIR CARGO EPICENTER

As the state's transportation hub and the epicenter of freight logistics, justifiably the industry outlook is discussed from the Anchorage vantage point, which has the most significant activity and growth potential looking ahead to the next decade. Major transportation carriers such as Lynden, Carlile, Totem Ocean Trailer Express, Horizon Lines, Pacific Alaska Freightways and Span Alaska Consolidators are growing.

Most air cargo headed for North America lands in Anchorage because it is originating out of the Pacific Rim. There are more than 20 air cargo carriers with a significant Alaska presence, including FedEx, with its third largest hub in Anchorage after Hong Kong and Memphis. And UPS, which is moving 320 additional pilots to Anchorage, DHL, Northwest Airlines and several freight forwarders and independent air cargo carriers such as Alaska Airlines, which is investing in a major expansion into the air cargo market.

Location is one of the main explanations behind the ever-increasing air cargo activity and profitability that comes from having freight go through Anchorage. Consider the great circle route between the Lower 48 states and Asia: the shortest distances are between Tacoma and Asia, or New York and Asia. "When you draw a line, that line will inevitably go through or near Alaska," Prokop says.

Bill Popp, Anchorage Economic Development Council president and CEO, uses another example to illustrate the efficiencies of Anchorage's location. Freight shipping from Singapore to Oakland--as opposed to going from Anchorage to Oakland--means Anchorage is only 115 nautical miles farther, so a refuel stop in Anchorage allows the plane to carry less fuel. Instead of...