‘Futures’ of air cargo industry

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“Our past actions and decisions determine the future of air cargo industry in the world,” said Oliver Evans, chief cargo officer, Swiss International Air Lines & chairman of the board of directors, The International Air Cargo Association (TIACA). Evans was addressing the delegates at the Cargo Facts Asia conference in Hong Kong on its inaugural day. According to Evans, for every stake holder in the air cargo industry they must look for “futures” instead of just “future”. “Because there are many futures for our industry and not just one future,” he said. He urged the delegates and the industry to wake up to the call of what the technology is bringing on board to help the industry to optimize returns. “Futures are coming to us faster than we can think about,” he said. He acknowledged the tendency of the industry to be slow adapters of technology and slightly reluctant to implement the latest innovation.

It is known that there was growth in 2013 and there is even more growth in 2014. According to IATA, in 2007 the total air cargo industry was worth $67 billion and that has declined by a whopping $7 billion in 2013 to $60 billion. However, it is a fact that the share of global trade transported by air is going down. Other modes of transport are doing better and according to Evans, air cargo competes with all other modes including the ones that will be created in near future, like drones used for delivery of packages, by new technology innovations.

“The question is not whether but when and how cargo robots will appear in our skies and work alongside aircraft and trucks,” said Evans. “My guess is that it will happen first in unexpected areas, driven by disruptive new entrants and benefiting the millions living in remote regions who will soon have access to the internet and global trade using low-cost smart phones.” He also dwelt upon how technology could exploit seabeds which could become the new pickup and delivery destinations. “The so-called offshore pickup and delivery points using some of the most innovative combinations of modes of transport.”

No region has been more important to air cargo than the Asia-Pacific over the last several years. But in 2013, growth rates in Asia remained lackluster, and some Asia-based air carriers saw actual year-over-year declines demand for air freight services. With the global air cargo industry and freighter aircraft demand so dependent on the health of the Asia-Pacific region, the conference looked deep into what happens in the industry in this promising region.

“There is lot of potential in the intra-Asia trade for the air cargo industry,” said Charles Kaufmann, head of Air Freight & Value-Added Services, DHL Global Forwarding. And according to Kaufmann e-commerce in China is fueling the express industry in China specially. However, there is a serious issue that the express industry faces in the rising e-commerce market of China. “E-commerce consumers in China want speed, they want goods delivered in 24 hours, but they don’t want to pay more for the speed,” said James Woodrow – Director Cargo, Cathay Pacific.

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