Russia - Air services struggle with capacity shortage

Shortages of commercial airline cargo capacity and inadequate airport facilities are continuing to create problems for companies offering domestic air express delivery services across Russia.

On the capacity front, explains Yuri Pavlyuk, country sales and marketing manager for TNT Express in Russia, difficulties primarily arise from the fact that airlines operating intra-Russian routes are generally still using narrowbodied aircraft. "The capacity situation is actually improving but the problem is that the volume of shipments is increasing even faster so it remains an important issue."

To counter such problems, continues Moscow-based Pavlyuk, TNT routes shipments via different airports to exploit all available commercial airline options. In Moscow, for example, it uses three airports - Domodevo, Sheremetyevo and Vnukovo - to find capacity to other parts of Russia.

TNT is set to increase its presence
in Russia with eight new depots

Another issue for Russian domestic air express operators, agrees Pavlyuk, is a lack of sufficient handling facilities at many airports. "The situation is all right in Moscow and St Petersburg, Yekaterinburg has quite a large airport and they are building a new freight terminal at Krasnoyarsk so things will be much better there.

Elsewhere in Russia, though, a lot of the airports don’t have enough facilities for handling the current growth in volumes." TNT claims to have achieved annual growth of over 50% in its Russian domestic express traffic last year. Those shipments, 95% of which were business-tobusiness, included spare parts, hi-tech items, telecommunications products and other equipment.

Pavlyuk says TNT is also carrying growing volumes of marketing material as both Russian and international companies, which tend to be based in the Moscow area, expand their business activities in other parts of Russia.

"Moscow continues to be Russia’s big business centre and most of our major clients are sitting here. However, many are opening new branches elsewhere in the country, which is generating increasing volumes of documents and parcels out of, and back to, Moscow."

TNT now offers domestic air express services between cities all over Russia, with transit times generally being 24-48 hours, states Pavlyuk. For heavier freight moving between Moscow and points up to about 2,000km away, the company also uses road transport. Transit times are said to be five to seven days.

"We don’t offer road delivery to cities in the east of Russia, like Khabarovsk or Vladivostok, for example, because the distances are too great, " adds Pavlyuk.

Feeder support

For international services into and out of Russia, TNT offers the same sort of air express options available to customers elsewhere in the world. To provide those services, the company primarily uses commercial airline capacity to/from Moscow, St Petersburg and Yekaterinburg. Additionally, it uses a five times a week small aircraft feeder link between St Petersburg and Kaunas, Lithuania, to connect with a freighter operating to and from its main European air express hub at Liege in Belgium.

When it comes to customs clearance of international express traffic into Russia, Pavlyuk says the situation has improved considerably since 2004 when the company’s customs code was changed.

"Before 2004, the average clearance time was 10 days.

Now it is three days, with the minimum being one day and the maximum maybe five to six days, and we are pushing to get a further improvement on that."

Russia is also served by TNT’s European scheduled service road express network, with Nizhniy Novgorod earlier this year added to a coverage that already included Moscow and St Petersburg. Routed via Helsinki, Finland, that daily road operation is said to offer a transit time from Amsterdam to Moscow, for example, of five to six days.

Although not expanding at the same speed as its Russian domestic traffic, TNT says its overall Russian international express business is also growing strongly, with combined import/export volumes up around 25% over the last year.

In line with general industry trends, there is a fairly consistent traffic imbalance in TNT’s Russian international volumes, with a 60/40 ratio in favour of imports.

"One small change we have started to see over the last year is an increase in broken spare parts coming back out of Russia into western Europe for repair, " comments Pavlyuk.

"We already carry large volumes of new spare parts into Russia, particularly for the automotive, hi-tech and telecom industries." To support its Russian express operations, TNT currently has 13 depots of its own there, and is planning to substantially strengthen that presence with the opening of a further eight by the end of this year. It also has 35 agents working under the TNT logo.