Can CFR be used for air transportation?

CFR, also known as Cost and Freight, is an international trade term mainly used to describe the seller's responsibility for the cost and freight required to transport the goods to the designated destination port. This trade term is usually widely used in ocean transportation because it is closely related to the characteristics of ocean transportation. However, whether CFR is applicable to air transportation is indeed a question worth exploring in international trade practice.
Firstly, we need to clarify the core concept of CFR. According to CFR terms, the seller is responsible for arranging the transportation of the goods and paying the freight to the destination port, but the risk of the goods passes to the buyer after the goods cross the ship's rail at the loading port. The key here is "freight" and "ship's rail". Freight usually refers to the cost of transporting goods from one place to another, while hull is a specific concept in ocean transportation used to define the transfer point of risk and cost.
Next, we will consider the characteristics of air transportation. Air freight is a fast and efficient mode of transportation, especially suitable for small, high-value, or urgently needed goods. Compared to ocean transportation, air transportation does not have the concept of "ship's rail" because goods are transported directly by aircraft from the takeoff airport to the destination airport. In addition, there are differences in the calculation method of air freight compared to ocean transportation, usually based on the weight and volume of the goods.
Therefore, on the surface, the CFR term does not seem to be entirely applicable to air transportation. Firstly, the concept of "freight" in CFR may need to be adjusted in air transportation to accommodate different freight calculation methods. Secondly, the risk transfer point in CFR - "hull" - does not exist in air transportation, which makes the application of CFR terminology in air transportation complex and ambiguous.
However, in practical operation, some trading parties may still choose to use CFR terminology for air freight transactions. This usually occurs when both the buyer and seller have a full understanding of the transaction terms and are willing to clarify their respective rights and obligations through negotiation. In this case, both parties to the transaction may make appropriate adjustments to the CFR terminology to adapt to the characteristics of air transportation. For example, they can clearly agree on key terms such as the calculation method of freight, insurance liability for goods, and risk transfer points.
In addition, it is worth noting that there are other trade terms applicable to air transportation in international trade, such as CIP (freight and insurance paid to designated destination) and DAP (delivery to destination). These terms are more in line with the characteristics of air transportation and can more accurately describe the rights and obligations of both buyers and sellers. Therefore, when conducting air freight transactions, both buyers and sellers can consider using these more appropriate trade terms.
In summary, although CFR terms have a wide range of applications in ocean transportation, their differences from air transportation make their application in air transportation complex and ambiguous. In practical operation, both the buyer and the seller should choose appropriate trade terms based on the specific situation, and clarify their respective rights and obligations through negotiation. Meanwhile, with the continuous development and changes in international trade, we also need to constantly explore and innovate to adapt to the needs and challenges of different transportation modes.
In summary, whether CFR is applicable to air transportation depends on specific transaction conditions and negotiations between the buyer and seller. In practical operation, we should flexibly use various trade terms to ensure the smooth progress of transactions and the protection of the interests of both parties. At the same time, we should also pay attention to the development trends and changes in international trade, in order to timely adjust and improve our trade practices.