DELEGATES attending the world Cargo Summit in Bangkok on January 30 were told that things are 'going well' for air cargo.
Steve Saxon, a partner with McKinsey who leads its Asia Pacific airlines practice, outlined four reasons why the sector is buoyant despite an increasingly fraught world situation, but also signalled some concern.
Principal among the reasons to be cheerful is that 'demand is incredibly resilient'.
Growth overall, he said, had come down to low single figures but whilst it would be persistent, it was not going to be in the 5 per cent to 10 per cent bracket.
Counterintuitively geopolitical disruptions such as the conflict in the Middle East and the Houthi attacks of Western ships had served to increase air cargo's usefulness in moving needed goods.
'The demand side is supported by disruption,' Mr Saxon told the Summit. 'For all of these durable reasons, we are optimistic.'
Another reason for positive expectation is the ongoing and, in Mr Saxon's words, 'seriously underestimated' e-commerce boom.
This was corroborated from the podium by Wilson Kwong, chief executive of cargo handler Hong Kong Air Cargo Terminals Limited (Hactl), who reported cargo growth at Hong Kong Airport for last year of 3.2 per cent to 4.3 million tonnes with 'a lot of growth in the fourth quarter'.
Despite that, there is a general feeling more capacity is needed as the lack of it might end up being a problem.
One of the concerns flagged by Martin Drew, chief strategy and transformation officer, Atlas Air Worldwide, is the limited capacity could become for e-commerce.
Temu is shifting between 1,500 and 2,00 tonnes daily and the expectation is it will be moving 5,000 tonnes daily by year's end.
That's the equivalent of fifty 747s a day assuming they can get the planes and staff to process it all.
The other issue where more action is needed is sustainability. This is a bigger issue than just catering to customers who want to buy greener shipping products - some 60 per cent do according to Mr Saxon - but it is also one of economic need.
Emissions are 435 kg per ton-kilometre for goods moving in a plane but less than 100 kg when the same goods go in a container.
'This is what is driving the longer-term modal shift,' said Mr Saxon. 'Shippers not only have cost pressures, but many are signed up to targets.'
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Steve Saxon, a partner with McKinsey who leads its Asia Pacific airlines practice, outlined four reasons why the sector is buoyant despite an increasingly fraught world situation, but also signalled some concern.
Principal among the reasons to be cheerful is that 'demand is incredibly resilient'.
Growth overall, he said, had come down to low single figures but whilst it would be persistent, it was not going to be in the 5 per cent to 10 per cent bracket.
Counterintuitively geopolitical disruptions such as the conflict in the Middle East and the Houthi attacks of Western ships had served to increase air cargo's usefulness in moving needed goods.
'The demand side is supported by disruption,' Mr Saxon told the Summit. 'For all of these durable reasons, we are optimistic.'
Another reason for positive expectation is the ongoing and, in Mr Saxon's words, 'seriously underestimated' e-commerce boom.
This was corroborated from the podium by Wilson Kwong, chief executive of cargo handler Hong Kong Air Cargo Terminals Limited (Hactl), who reported cargo growth at Hong Kong Airport for last year of 3.2 per cent to 4.3 million tonnes with 'a lot of growth in the fourth quarter'.
Despite that, there is a general feeling more capacity is needed as the lack of it might end up being a problem.
One of the concerns flagged by Martin Drew, chief strategy and transformation officer, Atlas Air Worldwide, is the limited capacity could become for e-commerce.
Temu is shifting between 1,500 and 2,00 tonnes daily and the expectation is it will be moving 5,000 tonnes daily by year's end.
That's the equivalent of fifty 747s a day assuming they can get the planes and staff to process it all.
The other issue where more action is needed is sustainability. This is a bigger issue than just catering to customers who want to buy greener shipping products - some 60 per cent do according to Mr Saxon - but it is also one of economic need.
Emissions are 435 kg per ton-kilometre for goods moving in a plane but less than 100 kg when the same goods go in a container.
'This is what is driving the longer-term modal shift,' said Mr Saxon. 'Shippers not only have cost pressures, but many are signed up to targets.'
SeaNews Turkey