Efficiency up and costs down as Lufthansa opts for Tisys

Lufthansa Cargo, a subsidiary of the airline giant, has achieved both a major drop in its use of European roads and freight cost reductions of 5 per cent, since adopting an electronic logistics platform.  

The TISYS system, supplied by Transporeon has made order placement more efficient at a time when Lufthansa Cargo is handling approximately 1.8 million tons of freight worldwide per year, particularly building components, fruits and textiles.

Lufthansa's freight-carrying aircraft are supported by chartered trucks within Europe. The air fleet alone has long been unable to cope with the increased freight volumes.

As Lufthansa Cargo only places orders for one way trips, a large number of trucks have travelled empty or with less than full capacity loads.

Increased internal efficiencies and the introduction of TISYS have now substantially reduced the problem in the sector of the industry known as "Transport at Level Zero".

Christa Pannke, Manager of Operation and Control of the Road Feeder Service (RFS) at Lufthansa Cargo, explained that the process of freight flown in from other continents and continuing its journey on European roads is a tested and inevitable practice for the companies concerned. 

"The European region simply does not have the loading capacity to transport all goods to and fro by air," she said.

Over 500,000 tons of freight are transported by road each year by Lufthansa Cargo.

Consignments that are fitted with a flight number, such as air cargo, flow to and fro between the big German distribution centres in Frankfurt, Leipzig and Munich and approximately 80 other European airports. Even distant transport routes, such as those to Helsinki and Madrid, are served by trucks.

Idle trips as a factor of cost

Three quarters of all road trips are regular deliveries made by permanent contract partners in accordance with a precise flight or driving schedule. The remaining 25 per cent is irregular additional freight, for which one way orders have to be placed spontaneously. 

Traditionally, the placement of freight orders was organized on a decentralised basis. 

"Whenever additional capacities were required, colleagues on the spot made telephone calls to find a transport company using a list of companies and a table of prices for order assignment," said Pannke.

Central assignment of freight orders through a closed Internet Platform

In the new system each cargo centre reports loads that cannot be transported by air freight to the Frankfurt centre, where bidders are asked to submit their tenders each day. The modular logistics platform TISYS developed by Transporeon has enabled this increase in efficiency to be achieved.

When a shipper company sends a new order through the module TICAP, all connected carrier companies can view the related specifications and consider submitting a quotation. Orders can therefore be placed with the most economically feasible vehicle, and carriers can more easily optimize their route plans to reduce idle travel distance and related costs.

According to Pannke, "Our goods are also transported on the street in airfreight containers. However, these boxes can be loaded only through roller conveyors because of their thin metal-plate walls. There is the possibility that they will end up bending on a forklift. For this reason, roller bed trucks that have rollers settled on the floor of their storage space are used in airfreight substitute shipment. With TISYS, Lufthansa Cargo is able to ensure that only tested and experienced carrier companies with appropriate vehicles can gain access to orders."

Now 69 carrier companies are authorized to participate in the closed freight-carrier pool of Lufthansa Cargo. 

"Changeover to this system went without a hitch, above all else, because the system is designed to be very user-friendly," declared Pannke. The initial scepticism from carriers regarding this unusual communication channel has given way to goodwill."