A new equilibrium
The IMF’s latest World Economic Outlook in April forecasts a “rocky recovery” from the recent global economic challenges, with growth forecast to slow from 3.2% in 2022 to 2.7% in 2023 – “the weakest growth profile since 2001, except for the global financial crisis and the acute phase of the Covid-19 pandemic”. These figures are reflected in a continuing year-on-year drop in global air freight activity, although average rates remain significantly higher than pre-Covid.
There is also a lot going on still in various areas of the market, including continuing growth in certain product categories such as the ‘evergreen’ Pharma sector (see page 14), where operators continue to invest in better facilities and processes. But there are also fresh waves of air freight developments and initiatives from the tech side, plus further M&A activity among major freight forwarding and cargo handling companies.
In Asia (see page 6), there are signs that the US and China are indeed decoupling in many fields, although the picture is a complex one – in part determined by the availability of logistics and air freight capacity in alternative countries in the region. Vietnam, Malaysia and Thailand are among the countries that have seen the most manufacturers set up their additional Asian locations – under a ‘China+1’ supply chain model. Various southeast Asian countries are gearing up with improvements to existing infrastructure and entirely new facilities, and new free trade agreements look set to further boost their opportunities.
On the freighter side (page 25), the market is continuing to adjust to the dramatic changes of the last three years. With the commercial air travel market continuing to recover, there are very few passenger aircraft still operating in cargo-only mode as ‘preighters’. But Boeing says utilisation of dedicated all-cargo aircraft remains elevated over pre-2019 levels, despite the softening in demand and pricing and the reintroduction of older freighters and acceleration of P2F conversion programmes of the last two years. And forwarders insist there’s still a need for the own-controlled networks they have expanded during the pandemic.
Elsewhere, the continued growing influence of new technology in air freight and logistics is reflected in ‘Innovation Insights’ articles on the digital revolution in cargo insurance, in which insurance specialist Breeze (page 34) highlights how technology can help assess risk, detect fraud, and reduce costs and human error. And Raft’s Lionel van der Walt discusses how the age of artificial intelligence in freight has already begun, and the implications of this.
And finally, reflecting our greater recent and current focus on people-related topics, the main interview article in this issue of the magazine examines some of the key factors in developing leadership qualities and capabilities within air cargo professionals, via an extended discussion with the larger-than-life president and CEO of ACL Airshop, Steve Townes. He’s had an interesting career path, and his insights about leadership provide much food for thought. I’ve certainly found myself sitting up a bit straighter in my chair!
Featured in this issue
A digital revolution in cargo insurance
AI, data analytics and technology are transforming almost every aspect of the air freight sector, including cargo insurance – enhancing customer experiences, reducing operational costs, helping to b...Read More
Asia’s new supply chain equilibrium
Over the last few years, international manufacturers have been increasingly looking to shift some production away from China, in order to add resilience to their supply chains. Megan Ramsay examines t...Read More
Cargo iQ brings visibility of service agreements to cargo handlers
New access for GHAs to view shipment-level service timeline data in the Encore system will help to meet delivery targets and avoid SLA failures, air cargo quality organisation says Air cargo qualit...Read More
Freighter demand stays firm despite market softening
Utilisation of dedicated all-cargo aircraft ‘remains elevated over pre-2019 levels’, and forwarders insist there’s a need for the own-controlled networks they have expanded during the pandemic. ...Read More
Menzies Aviation agrees to buy a majority stake in Portugal’s Groundforce
Agreement with TAP Air Portugal will give Menzies a 65% share of Portugal’s airport ground handling services market, with operations at five airports and more than 3,000 employees Menzies Aviatio...Read More
New lightweight active container makes maiden flight
Swiss Airtainer’s self-sustaining unit for life-saving medicines ‘brings significant weight reduction of 250kg and thereby less fuel consumption’, using solar energy to feed its battery Swiss...Read More
Pharma air cargo market in good health
Stakeholders are stepping up their capabilities to handle rising healthcare volumes, which continue to grow in importance as demand for other products wane. Ian Putzger reports Carriers, airports, ...Read More
Pharma handling interview: Menzies Aviation
Q&A with Alan Glen, VP for cargo development How has pharma business shaped up for Menzies over the past year? Our air cargo network has grown over the past year from 58 locations at the start...Read More
The age of AI in freight has already begun
A fragmented landscape of essential service providers means access to one central control tower that integrates and synthesises all of these is an essential component for informed decision making and ...Read More
The need to stay ahead in air cargo security
Advanced security technology – including increasingly sophisticated and automated threat-detection screening capabilities – can help air freight operators satisfy new regulatory requirements and s...Read More