Qantas Freight logistics customers are asking the Australian airline to waive terminal handling and document fees as a way to offset the financial squeeze from a debilitating IT meltdown that has caused extensive shipping delays for more than three weeks.
Another headache cropped up over the weekend when a piece of loading equipment malfunctioned at Sydney airport and slowed cargo movements.
The Qantas Airways cargo division says it has fixed the software glitches that undermined a major systems integration and made a big dent in the shipping container backlog at Australian airports. The entire operation is expected to be back to normal on Saturday. By that time the disruption will have lasted a month.
Shippers aren’t satisfied with Qantas’ response and are asking for a credit, saying they shouldn’t have to pay cargo processing fees when service was so poor for so long.
The Freight & Trade Alliance (FTA), which represents logistics and trade service providers in Australia, “proposed to Qantas Freight that consideration be given to waiving terminal fees for the affected period as a limited form of compensation and show of good faith,” said Tom Jensen, head of international freight and logistics, via email.
Member companies are reporting that many customers are withholding payment of invoices due to severe delays, up to several days in many cases, stemming from the fraught transition to the new operating system. The situation has increased costs, from increased administrative activity to paying idle truckers unable to retrieve shipments, and degraded business functions for many Qantas users. Importers and freight forwarders complain they have not been able to meet delivery commitments and face the potential of losing future business.
Qantas has not responded yet to the FTA’s proposal but is withholding invoices while it works to reconcile charges for freight forwarders. The airline is not charging customers storage fees for stranded cargo during the ordeal.
Shipper and logistics groups have previously said they expect Qantas to compensate customers for expenses incurred by the disruption. The FTA has said that Qantas dropped the ball by not having adequate contingency plans in case the IT rollout backfired.
Qantas Freight operates a dozen cargo jets, including three Airbus A321 converted freighters that fly for Australia Post, four older Boeing 737 converted freighters, and two medium widebodies (an A330-200 and one 767), in addition to managing freight carried on Qantas passenger aircraft.
The cargo division of Qantas Airways switched to a new cloud-based cargo management and booking system on Sept. 24. It quickly began experiencing problems when the system cutover didn’t go smoothly, leaving the airline and customers clueless about where shipments were located in the network, scuppering reservations and forcing all parties to resort to manual communications and data exchange.
Qantas Freight says most freight activity has returned to normal.
The carrier’s terminal in Brisbane is operating smoothly again, and the airline continues to reduce accumulated containers in Melbourne and Sydney. It is targeting a return to normal operations in Sydney by Thursday and in Melbourne by Saturday, according to an online customer update.
With the reduced congestion, Qantas Freight said it is now accepting transhipment bookings again at all stations.
Manual procedures implemented in the early stages of the disruption to keep processing freight have been replaced with digital scanning and certifications, which will allow for more accurate online tracking of shipments, said Qantas.
While ground workers continue to work extended hours to clear the freight backlog, they also are focused on keeping new inbound freight quickly flowing without delay, according to the company. It is giving first priority to shipper-built containers — tendered as complete units by a single customer with contents that don’t require sorting — to open more space in its terminals.
Meanwhile, an elevated transfer vehicle at Qantas Freight’s terminal at Sydney airport broke down on Saturday. The rolling machines are used to lift containers stored in multilevel racks and for on/off truck transfers.
Qantas said it repaired the equipment on Monday and that most of the freight impacted by the outage has been delivered.
Click here for more FreightWaves/American Shipper stories by Eric Kulisch.
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