The International Air Cargo Association’s director general Glyn Hughes (pictured below) explains how the air cargo industry has risen to the Covid challenge, and assesses the possible post-pandemic landscape.
This piece first appeared in the Summer issue of Airline Cargo Management, you can read the full magazine here.
As we look back over the past 14 months, the impact of the Covid pandemic can be seen in many aspects of global society. It has influenced how we work, how we interact, how we consume goods and how we deal with our own and each other’s health and safety.
The Covid pandemic generated the ‘Covid economy’, which created consumer demand for PPE products which were previously restricted for use within hospitals and health facilities, and it generated an even greater acceleration towards e-commerce. This new demand caused an increased requirement for air cargo capacity, which was suffering from a 40 per cent reduction as the bellies of passenger aircraft lay grounded in the desert because of 80 per cent reduction in passenger demand.
But the air cargo industry rose to the challenge. Many parked freighter aircraft were brought back into service, planned retirements were deferred and most innovative of all was the mobilisation of more than 2,500 parked passenger aircraft for cargo-only operations. Of those, nearly 250 had their seats removed to enhance the available payload.
New loading and off-loading processes were required, new intelligence regarding global situations was needed to ensure an effective operational environment could be established, and new levels of collaboration became the key ingredient which determined success, particularly as national lockdowns created broader challenges not experienced previously. Then new challenges arose as lockdowns were replaced with economic recovery and vaccine distribution.
This is where supply chain partners and airport communities really stepped up. By working more closely together, communication was open and transparent and facilitated greater focus on the common goal of providing a safe, secure and efficient environment to move air cargo.
Going forward, community-based collaboration will be needed more than ever as the passenger side of the industry faces several challenging years ahead to resume previous levels of global network connectivity and passenger numbers.
This means that air cargo will continue to operate in a capacity challenging environment with increasing volumes of air cargo demand. By comparison, international passenger numbers in March 2021 were 87.8 per cent down vs 2019 whereas air cargo flown in March, as measured by CTKs, saw a 4.4 per cent increase vs 2019 levels. And considering that pre-Covid roughly 50 per cent of air cargo moved in the bellies of passenger aircraft, the scale of the challenge ahead is very evident and will require continued collaboration and innovation to address.
The most successful companies and air cargo communities will be those which can anticipate the enhanced demand and have effective response plans in place. Longer term infrastructure investments in specialised facilities will also dictate the need for future collaborative and open community dialogue.
As we have seen with the first few months of Covid vaccine distribution, those airport communities which already had a demonstrated expertise in the safe and secure movement of such precious cargo have been the first to which this new cargo has been routed.
But considering only around 15 per cent of the global population has received a Covid vaccine, there is considerably more urgent vaccine distribution ahead. So now is the time for all airports and all local communities to prepare.
As the vaccines are being transported across the globe, it is apparent that the challenge of Covid-19 vaccine distribution demands the highest standards of speed, security, reliability and transparency.
Airport communities play a critical role communicating recommended best practices for each stakeholder in the air cargo supply chain when addressing the four major requirements identified above.
Another critical factor is the need for even more rapid industry digitalisation which is a critical enabler for industry efficiency as real time accurate information sharing is an imperative. This will also enable supply chain partners to connect with each other, and communities to connect with other communities, thus creating global networks of trusted partners.
So, looking ahead we can anticipate the continuing situation of passenger aircraft operating cargo-only operations until global passenger demand results in the resumption of global passenger networks.
Freighter fleets will continue to operate at high levels of utilisation and combination carriers will continue to focus on maximising cargo revenues to supplement reduced passenger-based incomes.
Cargo demand will continue to rise to support the e-commerce sector, economic reopening, resumption of consumer spending and growth in global economic activity, as well as continued increased demand for pharmaceutical and vaccine products.
Collectively, the air cargo industry played a vital part in the fight against the Covid pandemic; it will play a vital part in the Covid vaccination challenge; and it will play a vital part in the subsequent economic resurgence. Air cargo makes things happen.