Volcano's Business Impact

ATeam

Senior Member
Retired Expediter
The eruption of a volcano in Iceland and the ash spewed into the air has turned much of Europe into a no-fly zone. The immediate business impact is discussed in this AP article.

Excerpt: "Airlines are already counting the cost of grounded planes, and there are growing fears about the transportation of food supplies and other essential goods should the flight disruptions persist for several days — or longer."

This got me to wondering what impact, if any, a prolonged grounding of flights in Europe and possibly elsewhere might have on the U.S. trucking industry and expedited freight transport.

At present, it appears that flights will return to normal early next week. I'm wondering what impact, if any, a prolonged grounding of flights might have, if, hypothetically, the same volcano spewed more ash for a prolonged period of time?

Your thoughts?
 
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Mike99

Veteran Expediter
The eruption of a volcano in Iceland and the ash spewed into the air has turned much of Europe into a no-fly zone. The immediate business impact is discussed in this AP article.

Excerpt: "Airlines are already counting the cost of grounded planes, and there are growing fears about the transportation of food supplies and other essential goods should the flight disruptions persist for several days — or longer."

This got me to wondering what impact, if any, a prolonged grounding of flights in Europe and possibly elsewhere might have on the U.S. trucking industry and expedited freight transport.

At present, it appears that flights will return to normal early next week. I'm wondering what impact, if any, a prolonged grounding of flights might have, if, hypothetically, the same volcano spewed more ash for a prolonged period of time?

Your thoughts?

My only thought is that I will fly Tuesday in Munich Germany with my daughter. I hope everything will be OK.
 

greg334

Veteran Expediter
...

This got me to wondering what impact, if any, a prolonged grounding of flights in Europe and possibly elsewhere might have on the U.S. trucking industry and expedited freight transport.
...

Your thoughts?

Phil,
You got to be kidding? :D

There isn't any impact to any ground transportation within the states and thus far the impact is more of a safety precaution than it is a real threat.

More often than not, the countries in the EU will most likely be compensated and the interruptions to the service be thought of as just another day in the EU.
 

Streakn1

Veteran Expediter
Phil,
You got to be kidding? :D

There isn't any impact to any ground transportation within the states and thus far the impact is more of a safety precaution than it is a real threat.

Greg,
I wish you were correct and you very well may be, but read my thread "Spewing volcanoes/ declining revenue" and you will see that areas of ground transportation are in fact already being impacted. Greatly!

My wife and I are only a very small piece of the overall picture.
Example: Our carrier looses their percentage on the loads we were to haul. The jet engine rebuild shops here in the United States that were to rebuild these engines have lost revenue. Considering that the shop typically makes approximately 30-40K to borascope an engine or 50K to replace a main bearing, the loses can add up quickly. The aircraft awaiting one of these engines to be hung on its wing is loosing tens of thousands of dollars in revenue for each day it is delayed from getting back in flight.

An airline customer we picked up emergency repair parts etc from yesterday told us that they have fifty (50) aircraft currently grounded and fully loaded with cargo that cannot be delivered.

Although my area of expedited freight (aviation) has seen an immediate impact, I do believe the remainder of the trucking industry will see an impact within the next few days to next week. To what extent? Time will tell. Will it take us all down?
Doubtfully.
 

greg334

Veteran Expediter
I don't see a massive or even a partial slowdown for the majority of transportation here in NA outside of the specialty markets and services - like flowers or asparagus or fish.

The stuff that you do which you do something I think is great, is dependent on an industry that is competitive with other industries and not all that exclusive, but sensitive to environment issues; volcano are like ice storms that are like earthquakes.

AND like R-R and other engine manufacturers over there, they may already have a contingency plans to move the parts/engines north or south and fly them out. It isn't that the entire EU is stricken, but just a strip of land effected which is my thinking that the impact will be more to the end flight user (passenger) than to the freight user.

BUT with that said, this is not something that will impact our industry as a whole, most of what we are getting comes from ships, not air shipments. There seems to be a panic with a select few, not including you for an obvious reason, but when something like this happens, this always to pop up here and in another forum.
 

LDB

Veteran Expediter
Retired Expediter
I saw an interesting program detailing an incident involving an aircraft flying through volcanic ash and losing all 4 engines. It was an interesting program and the pilots managed to save the plane. I sure wouldn't want to be on a plane flying through ash. I believe this will have an effect in specialized areas as we've already seen with one of our members but overall not too much.
 

layoutshooter

Veteran Expediter
Retired Expediter
There may be a lot of new real estate to develop in Iceland if it starts with some really good lava flows. That is how Iceland got there and stays there. It just gets bigger each time it erupts.
 

ATeam

Senior Member
Retired Expediter
Later this day, the AP published this piece: Impact of volcanic ash surfacing for US businesses

Excerpt: "On Friday afternoon, FedEx stopped accepting virtually all its lower-priority international shipments, which can include a wide variety of products from auto parts to clothing, in order to "control any backlog that might occur within the system," spokeswoman Sally Davenport said."

How many times have expediters brought freight to airports for shipment to Europe? How many times have expediters picked up Europe-origin freight from airports for local or regional delivery?

Diane and I have experienced no "volcano effect" on our business yet but if much of Europe remains a no-fly zone for long, it seems that we might.

Positive effects can be imagined too as flights are disrupted and businesses make other arrangements -- some requiring the use of expediter trucks -- to get the goods they need.
 
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pjjjjj

Veteran Expediter
It amazes me how people tend to see with narrow vision and seem only able to consider what might be an immediate impact on only their own very small world.
Also one thing to see narrowly, as we can't all think of every possible outcome of everything that happens in the world, but to boldly proclaim that world events will not affect perhaps far-removed entities in any way is just speaking without knowledge.
Many of the things that have gone on in the world over the last several years have had MUCH farther-reaching impact than I'm sure anyone could have imagined at the time.
For someone to be razzed for taking their thinking to a higher level and simply wondering what the greater impact might be doesn't do much for the credibility and insight of the razzer.
It reminds me of when some were yelling about the government saving the major car manufacturers because their deserved death would not affect them since their carrier doesn't do a lot of auto parts loads. :rolleyes:
Not everyone is a simpleton. It's all about the chain reaction.
 

layoutshooter

Veteran Expediter
Retired Expediter
Let's see, long term effects of this eruption. To Iceland first, only positive. Iceland IS the volcano. It is just going to get bigger. It is unlikely that the island will blow up. It is not that type of volcano and does not have an explosive history.

Short term: Industry and business and travel will be affect somewhat. Mainly air transport. Ground and sea transportation systems can handle ash better than aircraft.

Long term might be a lot different. If the volcano continues to put out ash at the rate that it is or greater it is possible to have great long term impacts. We could enter a cooling period which would greatly affect agriculture world wide and to a greater extend at the more northern latitudes. The ash could affect soils in down wind areas. Long term soil affects tend to be good for soils. Short term heavy ash cover can choke out plant growth.

Of course, that is the same story for EVERY volcano. They do what they do. Nature is nature. It does what is does.
 

greg334

Veteran Expediter
I somewhat agree with you Pjjjj, but by calling attention to an event that may or may not effect us in a large degree, puts many into the "sky is falling" mentality and seems to be more of propagating bad news instead of looking at the brighter side of the event.

THIS event is not effecting the entire world, it is effecting a section of Europe and preventive measures are being taken to ensure safety of the consumers. I already know that there are flights out of Spain, Italy and southern France and a number of companies are using rail and truck to move freight to those areas not affected by the disaster.

As so much that it is really effecting us, it isn't yet and most likely won't have a direct devastating impact on any one of us opposed to fuel prices, economy slow down and other meaningful issues. This does not mean that a few will not be impacted, reefer owners who haul fish, flowers or other perishable good may be but outside of that, it is the same game - worrying about loads that didn't get dispatched is a time consuming thing and isn't business worthy.
 

ATeam

Senior Member
Retired Expediter
...Many of the things that have gone on in the world over the last several years have had MUCH farther-reaching impact than I'm sure anyone could have imagined at the time....

Consider this an exercise in strategic business thinking. I'm not saying the eruption will have far reaching impacts. A quieting of the volcano and wind shift could end this tomorrow. Nevertheless, impacts are documented now. I find it interesting to think various scenarios through, especially as they apply to expediting in the U.S., since that is the business we are in.

Here is the latest from Blooomberg on business disruptions. Not mentioned is Lufthansa; the German airline that grounded every one of its planes worldwide today because of the volcano.

Now, look at the photo below, taken in the U.S. in 2003. It came to mind today as I read the Lufthansa report. For those of us who do airport work, it is not difficult at all to imagine how a prolonged ash cloud might affect our businesss.

PA010134.jpg

news
 
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JimF51

Seasoned Expediter
This is this morning's list of where flights are effected. The 1st part of the list is where all flights have been canceled. And the ash cloud is now expected to get worse between now and Tuesday or Wednesday.

The guy I was co-driving with in a D unit just went to a van 2 weeks ago. As of this past Wed., he's delivered or picked up 7 airport calls. Doubt he'll see any more of those till things settle.

Austria
Belarus
Belgium
Croatia
Czech Republic
Denmark
Estonia
Finland
France (northern part)
Germany
Hungary
Ireland
Italy (northern part)
Netherlands
Norway (southern part)
Poland
Romania
Slovakia
Slovenia
Sweden
Switzerland
Ukraine (Borispol Airport, near Kiev)
United Kingdom

Other countries:
Russia (delays and cancellations at all 10 international airports)

Spain (delays and cancellations at 30 airports)
 

OntarioVanMan

Retired Expediter
Owner/Operator
I could see it disrupting Phils division more so then anyones..as museum pieces/displays/artwork won't get moved out of some the countries affected and not making their shows....

on a side note it has had an effect...

The shutdown has also affected American military operations. Military supplies for operations in Afghanistan have been disrupted, and a spokeswoman for the Pentagon said that all medical evacuation flights from Iraq and Afghanistan to Germany, where most injured soldiers are typically treated, were being diverted directly to Andrews Air Force Base in Maryland.
 
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JimF51

Seasoned Expediter
The shutdown has also affected American military operations.

Troop movements, as well. My brother's unit was due home last Sunday, but was re-scheduled for Wed (not due to the ash cloud). The Wed. Now it's any one's guess. He things it's all a conspiracy, as his retirement kicks in shortly after getting back home :D
 

dletheridge

Seasoned Expediter
Researching
Volcanic ash is not like the ash from a forest fire or the ash from your fireplace. It contains things like rock fragments, glass shards, toxic gases and chemicals.

Business impact?
Look back to what occurred after Mt. St. Helens erupted, after 9-11.
What comes from and to the european continent via air?
How many loads have you in the last 6 months picked up or delivered to an air cargo terminal?
Are the alternatives cost effective? - 1) air cargo to africa then ground to europe, 2) cargo ship, 3) wait
 

Moot

Veteran Expediter
Owner/Operator
Two positive effects of the volcano:

My carrier's European division; El Gato Negro, based in Sevilla, Spain is hauling a record number of ground shipments from Lisbon to Copenhagen and points in between.

Large amounts of ash in the atmosphere could result in a cooling of the planet, thus offsetting the effects of global warming. This could give us an extra 1-2 years of life as we know it.
 

OntarioVanMan

Retired Expediter
Owner/Operator
Goes to show what can happen when the worlds economy/military depends greatly on one item....Jet engine...

Imagine the chaos if yet another major eruption happened...
 

Moot

Veteran Expediter
Owner/Operator
Imagine the chaos if yet another major eruption happened...

No need to imagine chaos if one is prepared. I've been practicing my Volcanic Eruption Reaction Drill for the day Yellowstone blows. You would do well to lay in a few extra shovels and a 6 pack of dust masks at the homestead.
 
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