SITA and trade association, ULD Care, wish to bring new efficiency to the air cargo industry by examining the application of blockchain to digitally trace and record the modification of custody of airline cargo containers or ULDs (Unit Load Devices) over their journey.

According to SITA, by reducing inefficiency, installing always-on tracking of ULDs, and leaving unnecessary paper systems, the usage of blockchain will save the industry $400 million a year in enhanced efficiency, fewer losses, and prevention of damage.

The proposed platform also allows a wide range of authentication and trust-based profits, decreasing the risk of cybercrime, tampering, fraud, trade-based money laundering, and illicit trade.

Bob Rogers, ULD Care’s vice president, and treasurer stated: “Air cargo represents only 1% of all global trade in terms of volume but accounts for 35% of the total trade value and the inefficiency is significant.”

“A container traveling from Shanghai to Long Beach could take up to 30 days to finish its journey, but the true travel time on sea or road is only around 15 days, with the remaining time spent on back-office and paperwork. The use of blockchain could revolutionize that process.”

Today more than eight hundred million ULDs are in employment by airlines. Yet, the system used to trace these ULDs has only been partially digitalized and depends on inadequate data sharing and record keeping.

The proposed blockchain system enhances efficiency by making use of all data points over the air cargo journey. It provides a platform that aggregates and processes the ULD information in a trusted and secure way.

The PoC will enlarge and update the current ULD interlining platform to incorporate non-airline third parties like ground handlers through open APIs and a new modern interface.

The results state SITA will “transform the industry by lifting the veil on a myriad of previously unknown factors like damage reports.”

Identifying the location of all ULD’s at all times suggests companies can precisely track where loss or damage happens and recover the expenses without hassle.

For any given shipment, there can be up to twelve custodian companies tracking and monitoring the cargo, with many depending on paper documents causing the process to be cumbersome and undermined by trust and transparency concerns. Blockchain offers a near-perfect solution to discuss these industry pain points with considerable cost and time-saving potential.

Matthys Serfontein, SITA’s president of air travel solutions, stated: “We are looking at blockchain very carefully and we’re excited to test the potential of the technology to transform the air cargo industry.

“Beyond cargo and across the air transport industry, we see massive potential for blockchain to address common challenges.”

“The biggest obstacles standing in the way of a seamless passenger journey and truly efficient air travel are the siloed processes across the many stakeholders, including airlines, airports, ground handlers, and control authorities. They act as significant speed bumps at every step of the way.”

This project forms part of SITA’s Global Blockchain Alliance, which is heading the investigation into blockchain’s potential for the air transport industry.

SITA’s role, as the air transport community’s IT provider, is to give governance for the global association, help the working groups, deliver all needed blockchain technology elements and assure proper alignment and validation with regulators and international standardization bodies.