Page 14 - STAT June 2023 Latest Issue

industryreport

– in fact, we have witnessed a 350 percent
growth year on year. We are confident that
our business will continue to grow signifi-
cantly in 2023, particularly thanks to the oil
& gas and e-commerce markets which are
looking buoyant. We expect to see growth
in all markets, but it is particularly busy on
the lanes from Asia to Europe.”
Eric Philip, Director, Business Develop-
ment, Avric Aviation, a global charter
solution provider headquartered in Dubai;
believes the current charter market demand
has experienced a softening compared to sively increase capacity, and could lead
the peak of the Covid-19 pandemic, influ- to overcapacity in the foreseeable future.
enced by various factors and that ‘market Unless there is another major event
adjustments’ are likely. which requires these capacities, the air-
He believes that given the prevailing lines may struggle to fill their additional
market conditions, many customers are aircraft, which will have a significant
hesitant to enter into long-term charter impact on air freight rates and may also
contracts and that the demand for annual impact charter prices.”
charter contracts is currently low due to the
overcapacity in the market. Catching up with digitalisation
“The demand on key routes like China to Much like the rest of the industry, air charter
the US and EU is projected to strengthen in In the past six ops are moving speedily into digitlisation of
late Q3/early Q4, although not as robustly months, we have processes which provides the much-need-
as in previous years. It is worth noting that ed visibility and efficiency that this vertical
overcapacity in the market can have adverse identified several new needs. Stakeholders affirm that digitisation
effects, and a market correction to address is ‘crucial’ to the future of air cargo charter-
the excess capacity may occur next year. air cargo charter routes ing and many are in different phases of the
Sustaining losses, in the long run, becomes in sub-Saharan and digitalisation journey.
challenging for many operators, prompting Magma Aviation, for instance, has
the need for market adjustments,” Philip says. West Africa. These been on a digital journey since early 2021,
Brian Davis, Commercial Director, NEO shared Brannigan.
Air Charter, told the publication, “What we routes allow us to offer He said, “The digitalisation project incor-
have noticed is the increase in charters for significant capacity on porates all departments at Magma Aviation,
projects being booked much further in and when complete, will mean that Magma
advance compared with pre-2020. A likely key trade lanes, enabling Aviation is in line with our peers in the mar-
reason is that clients prefer to minimise the ket. Some of the outcomes of the project
possibility of charter prices skyrocketing our customers to are automated permit applications, schedul-
again, as they did in 2020-2022. Our clients overcome infrastructure ing tools, route costing and reconciliation,
naturally need this certainty in their budget- CRM, cargo reservations system, business
ing for their own customers.” challenges and ensure intelligence, and track and trace.”
The Russia-Ukraine conflict that began Holger Ketz, Global Head of Air Lo-
last year has also removed a lot of freighter timely delivery of gistics Network & Carrier Management,
capacity from the market due to sanctions. their cargo. Kuehne+Nagel, said “We will continue to
The softness of the scheduled market invest in highly automated shipment execu-
has had a ‘knock-on’ effect on charters, Tristan Caldeira tion through our eTouch initiative. eTouch
shares Davis as he adds, “While the B747Fs Chapman Freeborn was already part of our transformation in
are not a great problem, the reduction in the context of our strategy until 2022 and
An124s and IL76s with their rough terrain traditional mainstays of ad hoc, urgent, covers instant, accurate actions and infor-
and self-handling capabilities will eventual- outsize, and offline operations.” mation to empower our product delivery
ly cause outsize, offline capacity shortages, Meanwhile, many airlines ordered new and to simplify the operational processing
and increased lead times. Charter looks freighters or placed orders for converted with our customers. Our ambition with
set to become more competitive over the P2F aircraft during Covid, and these con- eTouch is to run an intelligent and digital
next year or two. The resurgence of travel tinue to be delivered. operation with real-time visibility through-
has seen most of that capacity return to Cautioning about the issue of over- out every action with fully automated ship-
the market, so we have returned to our capacity, Davis added, “This will progres- ments at its core.”
12 | JUNE 2023 www.stattimes.com