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Has rising demand for e-commerce and fast deliveries established a long term structural shift towards moving goods by plane? The pandemic-induced boom in online shopping led to exceptional volumes for airfreight operators in 2021 as traders look to bypass bottlenecks in ports. More lower value goods made their way into air cargo holds that in the past were generally considered a more costly option to be reserved for more expensive items.
But maritime congestion has since eased, and falling demand has made sea mail cheaper and more competitive. Many air cargo operators are now navigating a decline in trade. Carriers in Europe, Asia-Pacific, and the Middle East saw air cargo volumes fall between 10 per cent and 16 per cent in September compared to the same time the year before, disrupted by the war in Ukraine, labour shortages, and lower levels of trade and manufacturing out of China due to Covid restrictions.
The industry is counting on the resilience of online retail and the assumption that buyers and sellers on the internet are willing to pay more for the faster delivery and tracking that aircraft provide. Despite increased warnings of recession and dips in consumer spending in the short term, manufacturing giant Boeing has forecast that global air cargo traffic will more than double by 2039, driven by e-commerce.
But perhaps the biggest vote of confidence has come from the competition as household names in sea shipping diversify and invest heavily in air freight. Denmark-based Maersk has launched an overseas air cargo hub outside Chicago's O'Hare Airport, and last year announced it had ordered five new aircraft to complement an existing fleet of 15 planes. CMA CGM struck a deal with Air France KLM, and May to jointly operate a fleet of up to 22 cargo aircraft. And MSC plans to expand into the sector in 2023. Capacity is increasing, along with the hope that e-commerce can sustain a steady climb for the air freight sector.