Air Transport World

International small package business booming. Customers are finally getting the international small package express service they have wanted for years.

There's no rest for the wicked. The same dogfight over the domestic U.S. air express business is coming to the international small package arena. There seems to be only one major difference between the former and the latter: It did not take quite as long for competition to surface abroad as it did in the United States.

Back in the good old days, when Federal Express Corporation (FEC) was creating modern air express, potential competitors were so doubtful of the possibilities they were quite happy to leave the field to FEC for awhile. It took several years for the U.S. domestic market to evolve to the current roster of major small package competitors: Federal Express, Emery Worldwide, Airborne, United Parcel Service, Purolator Courier and the U.S. Postal Service.

Now, competition is so fierce that very few people in the U.S. would characterize overnight delivery of documents or packages as an emergency as they once did. Service is exptensive and so reliable that the new "emergency" is same-day service, according to the traffic manager of a major computer manufacturer.

That range of service took a giant leap last month, when UPS began offering overnight deliveries to every address in the U.S., except Alaska and Puerto Rico. To accomplish this doubling of the company's geographic spread, it has built its fleet to 71 owned aircraft and another 140 under lease.

UPS' entry into any field makes shippers shout for joy, but it brings shivers to competitors. Although UPS does not offer volume discounts the way other express companies o, its sheer size ($6 billion plus in revenue) gives it the ability to offer across-the-board, single-shipment rates that undercut other vendors. When the company expanded its overnight coverage last month, it also increased its range of services. It now offers the least-expensive overnight-letter rate available to a one-letter shipper; an overnight flat package; service to Puerto Rico; and delivery by air within Texas (it has been awaiting approval for intra-Texas surface delivery for years).

For awhile, however, UPS' service remains less sophisticated than that of other air express firms. …

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