Panalpina warns of potential ground-handling gridlock during peak

While most of the focus in previous peak air cargo seasons was based on finding enough capacity before the busy end-of-year shopping spree, Panalpina said there is another threat lurking this fall at overcrowded cargo-hub airports.

After reporting the handling of just under 1 million tonnes of airfreight in 2017, a new record for the Swiss forwarding giant, Panalpina said the most pressing concern in the coming months will be ground-related, citing the ongoing space crunch in many cargo terminals at European airports, which could lead to slowdowns in trucking, warehousing, ground handling and customs clearance.

“We’re informing airlines and their third-party handlers of our shippers’ requirements,” said Lucas Kuehner, Panalpina’s global head of airfreight. “We are also talking to ground handlers and truckers to look at possible bottlenecks. We are even drawing their attention to specific arrival dates and times for incoming cargo from different airlines so that they can prepare accordingly.”

Airfreight rates today are about 15 to 20 percent higher than they were in 2017, the company said, and more increases by the third and fourth quarters of 2018 are expected. “The less you pay, the more likely your cargo will sit on the tarmac or in a transit warehouse waiting to be uplifted or picked up for onward distribution,” the company said.

Europe is not the only pain point, Panalpina said. Some airports in the Asia-Pacific region could be equally problematic, due to “global trade tensions” that may affect cargo flows. Products, the forwarder said, could be routed from China to countries such as Malaysia, South Korea, Vietnam and the Philippines, causing more unexpected strain on the less-developed airport infrastructure in those countries.

“Time to market is critical and you have to be able to execute, not promise and have the cargo stuck for three days in someone’s warehouse,” Lucas added.