5th August 2002
Subject: Volume Conversion 1:5000
Dear Yusen Customer:
We would like to advise you of a significant development in the calculation of air freight cost.
The International Air Transport Association (IATA) has recently announced a major change in the calculation of volume weight which is targeted to be implemented on October 1st.
What does this mean?
The current volumetric conversion is calculated by multiplying dimensions (in centimeters) and dividing by 6000 to obtain the chargeable weight per shipment. Under the new IATA rule , dimensions would be divided by 5000 , representing approximately a 20% increase in the chargeable weight and thus the cost. Of course many in the industry , especially shippers and freight forwarders, are very unhappy about this projected increase , which so far has been driven solely by IATA.
Nevertheless , there are several other factors and players which have to be considered since the implementation of such a change is not solely the decision of IATA. Government agencies –such as the Department of Transportation (DOT) in the U.S – must also approve such a change , as well as each individual carrier.
It is likely that there will be several developments with this issue prior to the intended implementation date. Of course , Yusen will continue to update the situation as it develops. Please also consult with your local Yusen office if you have any questions.
Thank you for your continued support
Yusen Air and Sea Service (USA) Inc.