After two relentless years of crisis, freight flows and the supply chains they support are beginning to normalise in many parts of the world. For air freight, the extreme capacity shortages and demand surges triggered by the pandemic have eased significantly, even if rates remain relatively high, bolstered by fuel surcharges. Returning passenger air services have progressively replaced ‘passenger freighters’, and air freight capacity is gradually recovering towards pre-pandemic levels, albeit with a higher proportion of freighter services.
The recovery of services has been limited in some cases by staff shortages. Recruiting and retaining staff has become one of the biggest challenges for businesses of all sorts. Companies are having to think creatively, attracting staff with better wages, conditions and facilities, with obvious cost and resource implications.
As highlighted in the Supply Chain Focus article on page 46, the extent of the disruptions during the last two years and the desire to build more resilient logistics systems – combined with the already worsening relationship between the US and China – have accelerated companies’ efforts to seek alternative sourcing locations. But rather than decoupling from China completely, most companies are opting to add alternative options – for example, a ‘China plus one’ strategy.
As freight flows normalise, pressure on certain congested airports should also ease. Nevertheless, efforts to improve and streamline airport cargo handling, for example through community initiatives and systems, look set to continue, and there has been an acceleration in community-led data sharing and cooperation. As highlighted in the Airport Cargo Communities and Systems article on page 4, the benefits of sharing data across multiple stakeholders are becoming so obvious that demand for increasingly sophisticated Cargo Community Systems – and the willingness to participate – are growing almost exponentially.
Partnership between handlers and forwarders are also discussed in the Forwarder Handling article on page 26, with multinational handlers seeing this as an area with potential. But the big forwarders also want to increase their handling control at major hubs, limiting the extent they will outsource second-line warehouse handling to third parties. Indeed, some forwarders are seeking to operate their own first-line facilities, although competition issues seem likely to limit the extent of this and continue to favour neutral third-party cargo handlers in that role, in most cases.
Meanwhile, across the freight market, there seems to be a fresh wave of consolidation, including among cargo handlers, as highlighted by the acquisition of Menzies Aviation by Agility/NAS. And the interest of investors in the freight market is further illustrated by the agreed sale of Atlas Air for more than US$5 billion. With fresh money coming into the air freight sector, further change will follow.
Featured in this issue
Agility completes £763 million acquisition of Menzies Aviation
Combination with National Aviation Services creates a leading global player in air cargo handling and aviation services with operations at 254 airports in 58 countries, handling 2 million tonnes of ai...Read More
Alliance Ground International acquires Airport Terminal Services
ATS adds 49 locations across Canada and the USA to AGI’s growing portfolio, also adding the cargo handling specialist’s first passenger operations US air cargo handler Alliance Ground Internati...Read More
Atlas Air Worldwide sale agreed for $5.2 billion
Acquisition by Apollo-led investor group is expected to close in the fourth quarter 2022 or first quarter 2023, taking the US freighter operating giant into private ownership Atlas Air Worldwide ha...Read More
Cargolux selects B777-8 freighter to replace its B747-400 fleet
Europe’s largest all-cargo airline selects Boeing’s newest cargo aircraft, launched in January and already boasting more than 50 orders, with the first deliveries anticipated in 2027 Europe’s...Read More
Connecting cargo communities
Airport cargo communities, often built around cargo community systems, have become increasingly important as a way for the otherwise fragmented air logistics chain to align processes and communication...Read More
Exploring the potential of forwarder handling partnerships
Leading third-party air cargo handlers are looking to expand their involvement in cargo handling on behalf of freight forwarding companies – encouraged by an increasing appetite and openness to cros...Read More
Global freight markets ‘begin to normalise’
But supply chains and logistics services will remain disrupted and with elevated freight rates for the foreseeable future, while companies are also seeking greater diversification of sourcing location...Read More
Global supply chain redesign underway
A new study has confirmed that a major global supply chain redesign and realignment is underway, with companies seeking greater diversification of their global sourcing locations. According to a Gart...Read More
Greener pharma logistics
An example of efforts to improve air freight packaging for pharma products is an MoU signed in June between Etihad Cargo with B Medical Systems, a manufacturer and distributor of medical refrigeration...Read More
Improving pharma air logistics systems
Pharma air logistics supply chains are becoming more reliable, thanks to a growing trend towards closer collaboration between the various partners. But gaps remain, reports Ian Putzger Airlines and...Read More
After the very high tonnages and yields of 2021, one big challenge has been telling airlines it is not going to be the same in 2022, says Prithviraj Singh Chug, CEO of India-headquartered GSSA Group C...Read More
Putting Swissport back on track
After a year in post, Swissport chief executive Warwick Brady outlines the progress made in restructuring this airport ground services giant and the challenges ahead. Mark Pilling and Olivia Pilling r...Read More
Rising to face new challenges
Middle East airports continue to invest in air cargo digitalisation, sustainability and specialist infrastructure, to support their roles as key regional connecting hubs for global air freight. Meanwh...Read More
Step by step
Nallian has packaged some of the functionality it originally offered as a Cargo Cloud into single products that can be used by a cargo actor and its (smaller) network, without the need for the entire ...Read More