A new perspective in the air cargo value chain

posted on 8th March 2023
A new perspective in the air cargo value chain

Disruptive technologies like machine learning, AI, IoT, robotics automation, and advance analytics are changing how air cargo works and will help businesses make informed decisions – while also increasing efficiency and improving interactions with customers, believes Guillaume Halleux, chief officer cargo at Qatar Airways

What are your expectations about how the market will develop in 2023?

“2023 comes with uncertainty, as macroeconomic trends, as well as lingering geopolitical issues are expected to continue to slow down the overall economic growth, directly impacting air cargo. E-commerce will definitely surge; in fact, it has driven the types of cargo transported by air, leading to more demand for delivery of small packages as more and more consumers are shopping online.
“We are also expecting a growing focus on sustainability through the use of efficient aircraft, waste reduction and recycling that will reduce the impact on the environment. We also see even more push for digitalisation for the many benefits it brings such as cost reduction, transparency and improved efficiency as well as contributing to environment.
“Finally, the global stabilisation of yields, specifically out of certain markets, will require Qatar Airways Cargo’s usual adaptability and flexibility, as well as customer centricity to ride the wave and strive to maintain our global leading position.”

What challenges and opportunities do you anticipate, and how do you plan to respond to these?

“In response to the emergence of new challenges and in anticipation of future demands, increased digitalisation and an ever-changing environment, Qatar Airways Cargo has launched ‘The Next Generation’, bringing a new vision to the way of doing business. Innovation is at the core of this strategy.
“In accordance with this strategy, we want to achieve a complete corporate mindset shift. We have begun taking a fresh new innovative approach to the business of air cargo, develop new talent while also attracting new ones, and tapping into the digital potential for an optimal user experience – as well as the transparency, convenience and speed that digitalisation brings. With this approach, Qatar Airways Cargo is defining its role in the air cargo industry. It is not about the younger generation, but about bringing a new perspective to everyone involved in the air cargo value chain.”

What role will new and emerging technologies play?

“The cargo industry, to be honest, has been lagging behind in terms of digitalisation adoption. However, the pandemic has shown us just how important automation and digitalisation are. New and emerging technologies will help facilitate seamless movement of air freight and greater cross-border trade resilience while offering our customers complete transparency, visibility and the convenience of booking at their fingertips.
“Moreover, disruptive technologies like machine learning, artificial intelligence, block chain, the internet of things, robotics automation and advance analytics are changing how air cargo works. These new technologies also help businesses to make informed decisions while also increasing efficiency and improving interactions with the customer.
“In addition, digitalisation will help us replace the paper documents in air cargo, which is a task that began many years ago.
“Indeed, at Qatar Airways Cargo, many of our digitalisation projects started before the pandemic and we are working towards completion of many other digitalisation projects such as engagements with marketplaces, online rate distribution, h2h API channel integrations with customers, and our continued support to IATA Digital Cargo initiatives – including the IATA One Record project – as well as ULD Bluetooth Low Energy (BLE) tracking, dynamic pricing, digitisation of the cargo sales funnel using Salesforce, data visualisation, data warehouse etc. On the operations front as well, we are making optimal use of digitalisation to automate our processes.”

How can you and other stakeholders more effectively in 2023 (and beyond) to streamline cargo operational processes and improve cooperation across the air logistics chain?

“It is very important to connect with stakeholders to analyse the supply chain and identify pain points as well as weak areas and make improvements by prioritising them. Additionally, data analytics and digitalisation help to provide end-to-end visibility across the supply chain. The global pandemic accelerated digitalisation and we have a host of digital solutions at our disposal such as AI, cloud computing, supply chain automation etc. Lastly, I cannot stress enough that collaboration is key. We must collaborate vertically and horizontally, improving our communication with suppliers, partners and competitors to bring in much needed improvements in the supply chain.
“The success of any business can be attributed to its partnerships and relationships and there are some key factors that helps us achieve success such as flexibility, open communication and transparency and accessibility.”

What have you been doing in 2022 to improve air freight efficiency, processes, operations and communications, and what will you do in 2023?

“The COVID pandemic changed the way air cargo carriers do business. We had already introduced digitalisation and fast tracked many digitalisation projects during the pandemic. Digitalisation has enabled us to re-evaluate our processes and tools so as to provide a more streamlined experience for both our internal and external customers. One of our biggest achievements during 2022 has been the introduction of the Digital Lounge, a premium booking experience, that provides a much more connected experience for our customers. In the new year, we will be taking this journey forward by elevating this booking experience with more focused enhancements tied in with clear operational strategies to complete the journey of cargo till its final destination.”

Operations initiatives
“On the operations front, we have achieved the ISO 45001:2018 standard, the occupational health and safety certification and the CEIV Lithium Batteries certification, endorsing our safety, handling and compliance to transport lithium battery products. I am a big advocate for the safe transport of lithium batteries, and we are glad to have our Dangerous Goods Manager on the advisory board of Qatar Civil Aviation Authority in the ICAO Dangerous Goods panel. We already introduced QKEs or Fire-Resistant Containers in 2021 and they allow us to accept lithium batteries from certain consolidators like Aramex and DHL in certain stations. We undertook several trials of fire-resistant bags for transport of mail and courier in passenger aircraft bulk and trials of technical detection where dogs that can sniff and detect undeclared lithium batteries. We have also identified x-ray machines throughout our network that are operated by our ground handlers, to ensure they are equipped with automated screening of lithium batteries.
“Considering our extensive trucking network in Europe, we also have deployed trucking control towers at Frankfurt, Munich, Dusseldorf, Liege and Brussels to optimise our road feeder service planning and improve the management of the RFS providers.”

Cargo Bridging Facility
“In addition, the new Cargo Bridging Facility (CBF) with 12,000 sqm space inaugurated last year, will help bridge the capacity gap at Cargo Terminal 1 until the Cargo Terminal 2 is complete. It includes separate temperature-controlled areas for +2 degrees C to +8 degrees C, accommodating 176 ULD positions, and +15 degrees C to +25 degrees C accommodating 128 ULD positions, more than doubling our cool storage capacity at the hub.
“The CBF is currently used for storing transit intact perishable products and is also designed to provide a dedicated service for import / export in the Doha market, catering to global forwarders and logistics providers, and offers customs preclearance including direct delivery and pick up of cargo.”

Any other observations about your expectations for air freight in 2023?

“It will no doubt be a challenging year: geopolitical tensions, high energy prices, rising interest rates and persistent inflation are expected to constrain global trade in 2023. Revenues are expected to be $149.4bn, which is $52bn less than 2022 but still $48.6bn stronger than 2019, according to IATA.
“The trade patterns around the world stand to be affected by the transition towards a greener world economy and the evolution of global supply chains. Trade patterns are also likely to be affected by the mitigation strategies.
“We will continue to strategise our network planning and commercial plans, adjusting the way we fly, where we fly and which aircraft we operate according to the market situation. We are becoming more cost conscious to ensure improved profitability for the airline and well as best value for our customers.
“There will also be a lot of focus on innovation in our processes, technology, people and skills.”