Rapiscan Systems is offering airports and airlines a way to find new and additional revenue sources as they and other nodes along the air cargo supply chain figure out how to comply with federal mandates that require all cargo being carried on passenger planes be screened for explosives during the next 18 months.
For example, third party screeners such as Rapiscan could compete to pay airports the right to set up a cargo screening facility at the airport that would inspect shipments for explosives prior to their being loaded onto a plane, Peter Kant, vice president for Global Government Affairs at Rapiscan, tells TR2. In turn, Rapiscan would charge the freight forwarder or Indirect Air Carrier to scan the cargo.
Rapiscan, a division of OSI Systems [OSIS], sells various types of X-Ray screening systems and other related equipment to airports, seaports and other customers around the world. That equipment runs the gamut from systems that that can screen persons and their carry-on and checked bags, to technology that can screen pallets of cargo and even shipping containers.
Through a small but strategic acquisition last fall of S2 Global, Rapiscan now also offers screeners, screener training, and maintenance services, making it a turnkey provider of X-Ray and other scanning solutions to potential customers, Kant says. S2 is providing Rapiscan enhanced insight into operating a checkpoint and how screening equipment can better be built, he says.
Early last year the Transportation Security Administration (TSA) unveiled the Certified Cargo Screening Program (CCSP) to meet the congressional mandate that 50 percent of all cargo on passenger planes in the U.S. be screened for explosives by Feb. 2009 and 100 percent by Aug. 2010. Under CCSP, manufacturers, freight forwarders, indirect air carriers (IACs), air carriers and even third parties can become Certified Cargo Screening Facilities (CCSF). Pushing the screening down the supply chain takes pressure off of the airlines, which currently do the inspecting.
Once a particular cargo has been screened for explosives, shippers and other participants in the supply chain will be responsible for ensuring the chain of custody for that cargo is secure all the way until it is loaded into the belly of a plane.
While CCSP allows for cargo screening to be distributed throughout the supply chain, TSA has put particular emphasis on screening by the IACs. The agency is providing partial funding to over a dozen IACs–which receive cargo from manufacturers and then consolidate it for delivery to air carriers–to help them purchase screening technology under the Screening Technology Pilot. The project will allow TSA to meet the 50 percent screening mandate next month, test how well the IACs do at using the screening technology and how well various screening systems work.
Kant says one problem with having the IACs do the screening is that they will have to own their own equipment and have operators trained to do the screening. “That’s the expensive part of the inspection,” he says.
And for the smaller IACs who might have to buy the equipment and train their screeners, they don’t have the economies of scale to make that investment, Kant says.
“Our idea was, take that part of the equation out, so [they] either go to the airline or go to the airport,” Kant says. “The freight forwarders and IACs would do everything they were doing before and then when they show up at the airport, they deliver to the air cargo inspection facility or ‘car wash.’ It could be at the airline or at the airport.”
Kant believes that at large airports dominated by one or two carriers the airlines would likely create space for the inspection facility whereas at airports hosting a number of carriers the airport would host the facility. The revenue model for the airlines and airports could be as simple as the concession model routinely in use for retail shops at airports now, that is allowing potential screening companies to bid for the space, he says.
Ultimately air carriers, which are the airlines, will be responsible for ensuring that all cargo loaded on their planes has been screened for explosives. Currently all cargo being loaded on narrow body passenger planes is being screened. That accounts for about one-quarter of all the air cargo on passenger planes in the U.S.
However, on its way to complying with the 100 percent mandate, TSA and the Department of Homeland Security’s Science and Technology branch conducted a series of pilot tests related to cargo screening and concluded that the airlines would not be able to screen all the cargo themselves without either jeopardizing flight schedules or creating huge airside bottlenecks that would prevent some freight from being loaded to meet departure times.
The screening systems that will be used by the IACs in the Screening Technology Pilot includes explosives trace detectors, explosives detection systems, and Advanced Technology X-Ray machines to inspect cargo before consolidating and transporting it to an airline for loading. TSA has also approved other screening technology for air cargo as well, including systems that can scan palletized cargo.
Last fall TSA assessed the pallet screeners in Europe as was “surprised” at how well they performed, Greg Miller, deputy program manager for Air Cargo Security, Office of Security Technology at TSA, tells TR2. However, he says the pallet screeners that work best are higher energy systems, which tend to be more expensive.
Rapiscan’s 632DV-AT palletized screener is on the qualified list, Kant says.
In addition to seeing how well the IACs do the screening, TSA plans to study how well certain screening technologies work with different classes of commodities and in different facilities.
“We will qualify equipment based on commodity,” Miller says at the recent American Association of Airport Executives Aviation Security Summit.
The air cargo screening mandate is turning into good business for the makers of screening equipment such as L-3 Communications [LLL], Rapiscan and Britain’s Smiths Detection. Kant says that in the past few weeks Rapiscan has had a “huge jump” in orders from the IACs for screening equipment to meet the pending requirements.