Covid-19 has shifted the world online. And for air cargo this is good news.According to a white paper by the International Air Transport Association (Iata), the pandemic forced governments to close borders, as they took drastic measures to protect people. As we head towards the middle of 2022 and new Covid-19 variants are found, restrictions are not yet completely a thing of the past and lockdown policies are still in place or implemented as and when required.In the wake of all this, consumers around the world have increasingly moved their lives online. What’s more, there is no indication this will change, even should the world return to pre-Covid normal. “Research is showing that those who started shopping online during the first months of the pandemic have continued to do so, accelerating the sector’s growth. As customer demands evolve, airlines and their business partners must keep transforming their services to stay relevant in a rapidly changing scenario,” reads the paper.According to Iata, e-commerce air cargo was expected to grow by around 10% per year from 2019 to 2025, but with e-commerce growth now in excess of 30% year-on-year, these figures are having to be revised.“In 2017, the annual value of global e-commerce sales reached $2 trillion and was forecast to exceed $4.4 trillion by 2025. This figure was, however, already achieved in 2021. The new estimated forecast for 2024 is well over all past predictions at $7.4 trillion,” according to the research paper.While e-commerce has seen high growth numbers in the developed world over the past decade, it was particularly in Latin America, the Middle East and Africa, regions that had been lagging mature markets before 2020, where e-commerce jumped years ahead in terms of volume.According to Iata, cargo became a lifeline for many airlines during the early days of the pandemic, allowing for some revenue collection. There has been a complete mindset change about cargo and by 2021 air cargo stakeholders had invested heavily. Freight now represents up to 35% of airline revenue.“The industry is now pushing towards transformation and resilience, to become more efficient, safe, digitalised and sustainable.”
Iata has developed several transformation strategies for airlines to consider implementing if they are interested in capturing more e-commerce volumes.Focus on e-commerce products and services to build market shareMore often than not e-commerce can be f lown as general cargo. This allows airlines to develop segment-specific products and services for this market, meeting specific online needs and requirements.Digitise to increase speedTransparency and digitally integrated systems that allow for data f low are critical in the fast-paced e-commerce space.Build into own systemAirlines must foster the transformation of their border processes to ensure smooth customs clearance. Develop systems that enhance a seamless and efficient physical operation.Shift to cargoCargo has never been a top priority for most airlines, which have been passenger focused, but the pandemic demonstrated the value of air cargo. Airlines need to invest in air cargo products and capacity.Compete through responsiveness and value-added servicesAirlines must optimise their air, border, and customs operations processes. Reducing processing times is critical for the online environment. Airlines will have to find ways to add value, increase convenience and improve efficiency for their e-commerce customers.The growth in e-commerce bodes well for airfreight. Photo: Dube TradePort
