2024 at Half-Time: What’s the score?

Really, when it boils down to it, there are plenty of similarities between the air cargo industry and a football game. Both require strategy, teamwork, coordination, and efficient execution to achieve success. As a large part of CargoForwarder Global’s side of the world is currently in EURO 2024 fever plus we have just witnessed the longest day in the year, this is a good time to take stock of the year so far, and how we feel it may pan out. Taking on the role of a sports commentator, here we go!

Welcome, fans, to the half-time recap of the 2024 Air Cargo Industry Cup! Judging by the first half, we’re in for a thrilling year-long match, with the latest prediction standing at double-digit growth, following MAY24’s incredible play with a +12% year-on-year volume score. Let’s recap the action, the goals, the offsides, and look ahead to what strategies will bring victory in the second half.

All eyes on the ball as we head into double-digit growth this year. Image: Imagen AI creation/CFG

Opening Move: E-commerce Surge
From the very first whistle, the air cargo industry took early possession of the year with a rapid e-commerce surge. According to Xeneta, e-commerce demand boosted early volumes, with precise logistics akin to a series of well-coordinated passes setting up early goals. Willie Walsh, IATA’s Director General, commented in MAR24: “This is a strong start to the year. In particular, the booming e-commerce sector is continuing to help air cargo demand to trend above growth in both trade and production since the last quarter of 2023. The counterweight to this good news is uncertainty over how China’s economic slowdown will unfold.”

Key Goal: Efficient Operations
Using AI and advanced logistics, the industry began shifting towards greater efficiency, scoring crucial goals in customer satisfaction and on-time delivery. Ball control in the shape of CargoAi’s CargoQUALITY kick-off as well as increasing cooperation between service as software providers, logistics specialists, airports and airlines to develop cargo community systems, made for more tight-knit team play. More and more players are starting to make use of real-time data analytics to create more successful game strategies.

Offsides and Challenges
The challenges posed by economic uncertainties, fluctuating fuel prices, exploding rates in ocean freight demanded strength and balance from air cargo’s defense, which partly gained from a modal shift from sea to air. Xeneta’s Chief Airfreight Officer, Niall van de Wouw highlighted that the U.S. crackdown on e-commerce shipments out of China, however, coupled with the potentially negative impact of rising costs and increasing transit times on consumer behavior, could lead to a decrease in e-commerce shipments. This could have a knock-on effect of freighter over-capacity bringing air cargo rates down, going forward. Global supply chain issues and geopolitical tensions were major offsides, causing delays and rerouting. However, the industry adapted quickly, showing resilience and maintaining strategic possession.

Strategic Goal: Sustainability Initiatives
One standout goal was the industry’s push towards sustainability. More airlines and forwarders signed SAF agreements, interest in TIACA’s BlueSky initiative grew, and diverse stakeholders pushed for hydrogen and electric solutions to aircraft propulsion. Several major airlines reported reductions in carbon emissions through new fuel-efficient aircraft and other sustainable practices such as ground equipment shifts towards electric vehicles, for example.

Penalties and Fouls
Penalties came in the form of increased regulatory scrutiny and rising operational costs. Safety issues, in particular, posed a concern both on the ground and in the air, Companies had to navigate these challenges carefully, avoiding fouls that could lead to costly delays. Red and yellow cards were metaphorically issued for compliance breaches, maintenance failures, and inadequate training, pushing players to stay within strict regulatory frameworks.

Second Half Predictions: July to December
As we move into the second half of 2024, the air cargo industry must stay adaptable, leverage technological advancements, and maintain a strong focus on sustainability to secure a win. Play strategy should include the expanding into emerging markets such as Southeast Asia and Africa. Establishing reliable networks and forming strategic partnerships will help to create strong offensive play. Managing high volumes while maintaining quality will test the industry’s stamina and strategy, and innovations in cargo handling and last-mile delivery will be pivotal.
Xeneta’s Chief Airfreight Officer, Niall van de Wouw, foresees a similar end of year peak to last year, and feels that the industry is in a better position to cope with the increase in passenger belly capacity over this summer.
IATA predicts that total air cargo volumes may reach 62 million tons in 2024. “The global economy counts on air cargo to deliver the USD 8.3 trillion of trade that gets to customers by air. Without a doubt, aviation is vital to the ambitions and prosperity of individuals and economies. Strengthening airline profitability and growing financial resilience is important. Profitability enables investments in products to meet the needs of our customers and in the sustainability solutions we will need to achieve net zero carbon emissions by 2050,” Willie Walsh, IATA’s Director General, commented, at the recent IATA General Meeting.
Teams capable of executing these strategies with precision and resilience will emerge victorious, navigating the challenges and seizing the opportunities that lie ahead.

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