Editor’s Note: Building the future that we want
For an exercise in humility — not that this year lacks for those — it’s interesting to go back and read predictions for the air cargo industry in 2020 from six months ago.
From our current vantage point, the good old days of 2019 were optimistic; people looked forward to summer vacations, business trips and networking at industry conferences. The industry was facing some headwinds, but early this year, industry observers hoped for a turnaround and an easing in the trade war between the U.S. and China; instead, we faced the disastrous COVID-19 pandemic. Certainly, 2020 has presented difficulties never imagined, not only to our business, but to industries and people everywhere.
Air Cargo World’s June features are being published on AirCargoWorld.com rather than in a print or digital issue. This month brings our annual Power 25 ranking of the world’s top airfreight forwarders for 2019, reminding the Air Cargo World staff that all in our industry was not golden before the pandemic.
Airfreight forwarders faced a difficult year in 2019, with 17 of the top 25 businesses reporting declines in volumes compared to 2018. In fact, it was the worst year for airfreight demand in a decade, according to IATA. And while air cargo revenues are expected to be strong in 2020 due to heavy reliance on airfreight amid the pandemic, 2019 demand was much stronger — in terms of tonnage — than 2020 or 2021 are likely to be. Read more about the 2019 freight forwarder rankings in the Power 25 feature.
From where we stand in the valley of the pandemic, some industry leaders are speaking out as to how previous logistics weaknesses are exacerbating current difficulties. Agility’s Andy Vargoczky points out in our June Cargo Chat how the importance of freighter aircraft to international supply chains is often overlooked because freighters are expensive to operate. The sudden dearth of cargo capacity in 2020 from the grounding of passenger aircraft is the natural result of prioritizing the lowest rates over all else in prior years. Read more on how that could change in the years ahead in this month’s Cargo Chat.
Our second June feature, “Paying their way,” examines digital payment platforms, just one of many facets of air cargo digitalization. Many of the companies we interviewed use digital booking and payments only for certain cargo, although the emerging consensus is that those failing to digitalize will be left behind. Industry players recognize the problem, but inertia is a powerful force to overcome — particularly when doing so means substantial investment and the consolidation of up to nearly 100 legacy systems.
All of these are difficult topics, especially as businesses also face layoffs and overall uncertainty. But air cargo must and will continue moving. Conversations about how to survive today while preparing for what’s on the horizon are vital to improving our future.
