Several ‘new norms’

posted on 15th September 2020
Several ‘new norms’

Jacob Mathew, president of National Air Cargo, says the group’s freight forwarding business has become more creative in providing end-to-end solutions as traditional capacity was unavailable or limited, and its cargo airline has expanded its fleet

Is a new normal (or a ‘pre-new normal’) emerging for cargo airlines and the air freight sector, as some countries and their economies begin to emerge from the initial effects of the pandemic?
Absolutely. Being an airline and having both passenger and air cargo operations in place, National is in the phase of a massive transformation evolving into ‘a new normal’ era of conducting business. In contrast to the dramatic drop in demand for passenger operations, the air cargo division at National has evolved to answer the call and move essential supplies to tackle the COVID-19 pandemic.

How have your business levels been compared with pre-pandemic?
National, being in business with government and semi-government sectors, freight forwarding has been steady during the crisis. On the other hand, although commercial freight forwarding declined at the beginning of the pandemic, volumes surged in the second quarter of 2020. Freighter capacity utilisation continued to be on the rise during the past 6 months.

What does that ‘new normal’ look like – or do organizations now have to prepare for several ‘new normals’?
We believe that most organizations in our industry must be prepared for several ‘new norms’ during these unprecedented times. Considering around 40% of global air cargo is transported in the bellyhold of passenger aircraft, there has been a huge capacity pinch. Cargo airlines like us must be prepared to take control and drive the business in order to meet the soaring demands across the globe.

Planning
To what extent have approaches to planning had to change as the effects of the pandemic have progressed?
Planning ahead during the pandemic has been challenging – no one expected the magnitude of this pandemic. However, short-term goals that we have set companywide has been paying off during this time. We decided to increase our B747-400F fleet size from 2 airplanes to 5 this year. These are steps we took considering both the short-term and long-term strategy; we have to keep maintaining the momentum and keep ourselves on track.

To what extent can companies or organisations meaningfully plan ahead at the current time?
There has been tremendous efforts and planning happening within many organisations, revisiting their key verticals and re-designing their product offerings based on the ‘new normal’ demand – a year focused on sustenance more, and not in line with the longterm organisational strategy.

What are the implications of these changes for your organisation?
The freight forwarding side has become more and more creative in providing end-to-end solutions during the pandemic period as the traditional freight lane capacity was not available or rather limited. The airline division saw the freighter demand but the challenges in crew positioning fulfilling COVID protocol requirements has been a tough one; but have managed well so far.

How sustainable is this situation?
Unless an organisation is ready for greater adaptability, to reduce costs, and be creative in its product offerings, sustaining these times would be tough.

Any other observations?
Vaccine availability can be a game-changer, but the get back to the old normal would take some time.