IATA calls for transformation in the Air Freight Industry
During the opening of the 10th annual World Cargo Symposium (WCS) in Berlin, the International Air Transport Association (IATA) called for transformation in the air cargo industry focusing on raising the quality of its offering.
The global air freight industry still faces a difficult business environment. The weak growth known since 2010 continued in 2015 with a 1.9% expansion of volumes. And IATA estimates that volume growth will reach 3% in 2016.
‘Air Cargo continues to be a challenging environment for airlines to keep revenues ahead of costs. The business, however, generates enormous value. Over a third of goods traded internationally – measured by value – are delivered by air cargo. To do that profitably, the air cargo sector must bolster its key strengths of speed and flexibility with modern processes and improved quality. That means transformation’ explained Tony Tyler, the IATA’s Director and CEO.
Tyler wondered why air cargo did not experienced the same transformation process that has refreshed the passenger side of the business. ‘Developments like e-tickets, bar-coded boarding passes, airport self-check-in kiosks and inflight Wi-Fi have transformed the passenger experience. Is it a coincidence that after a decade of change load factors are at record highs and airlines are finally rewarding their investors with adequate returns? We need similar breakthroughs on the cargo side of the business. There are lots of potential disruptors out there – data-sharing platforms, new market entrants, or e-commerce. The challenge is to stay a step ahead in satisfying customer expectations’, said Tyler.
Paperless processes and customised services are critical to the sector’s future. The foundations are existing but challenges remain:
- The pace of adoption of the e-Air Waybill (e-AWB) must accelerate. As at the end of 2015, e-AWB stood at 36%.
- There are still concerns about the quality service for temperature controlled shipments, such as pharmaceuticals. Patient safety is a key concern and compliance certification programs are a step in the right direction. But the breadth of adoption must evolve quickly for shippers to have full confidence in the system.
- There are still issues around the shipping of lithium ion batteries. In February 2016, the International Civil Aviation organization temporary banned shipments of lithium ion batteries as cargo on passenger flights, pending the development of a fire-resistant packaging standard. ‘Safety is the top priority. Banning lithium-ion batteries from airfreight does not solve the issue of counterfeit or non-declared goods. The issue lies with the lack of enforcement of the regulations by governments. So it is essential that authorities redouble their efforts to enforce the regulations and close the loopholes that prevent prosecutions of serial offenders.’ Explained Tyler.
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