Aug – Sept 2019

Issue date 19 August 2019
issue number 27

Global air freight volumes and yields have been in retreat for some months now in most major markets, falling back close to their levels in early 2017 – with a few notable exceptions such as traffic from East Africa, Northern Europe, North Africa and Central Asia, and particular growth markets such as Vietnam. The overall air freight contraction accompanies a slowdown in world trade growth, as trade and geopolitical tensions undermine global economic confidence. It’s a familiar pattern; and as history has shown, air freight demand will bounce back, probably in a year or so, when international confidence and stronger trade growth returns, triggering a fresh wave of restocking.

One question often asked is whether investments in air freight modernisation will continue in these leaner times. But with air freight finally beginning to see some sustained investment in and benefits from digitalisation, that momentum is surely unstoppable this time. That’s likely to be true for digital quotation and booking tools as well as ULD tracking technology and air cargo community data-sharing initiatives.

It is certainly seen as inevitable among major freight forwarders (page 47), including creating far greater transparency of freight rates – a trend forcing logistics players to be more efficient. That is likely to have implications all through the air freight chain.

The investment momentum has only fairly recently got started at some US airports (page 14), which have belatedly loosened the purse strings after seeing a sustained demand recovery in the last few years. Initiatives to create airport cargo communities are finally on the agenda there, as are facility upgrades and customs facilitation projects to ease and speed e-commerce traffic flows.

As an excellent discussion at this year’s Air Cargo Europe (page 4) highlighted, investment in automation is essential for some airports and cargo handlers – to deal with growing volumes and limited space, or staffing shortfalls. Although highly ambitious automation projects are planned, such as DWC’s underground cargo network and Frankfurt’s autonomous vehicle research project, in the meantime there are lots of other areas where new technology and process improvements can bring significant efficiency improvements. And in the short to medium term, some see significant scope from wearable technologies and other already available tools to optimise human performance in the air cargo handling environment.

Meanwhile, the excellent Pharma.Aero initiative (page 34) pushes on, demonstrating that end-to-end collaborative data sharing can be done across the fragmented air freight chain – when customers are motivated to participate – building on industry initiatives such as Cargo iQ and IATA’s One Record.

The project promises lessons for the whole sector – thanks to the association’s open approach to sharing best practice. It’s a commendable attitude and an initiative worthy of attention and support.