As 2024 draws to a close, the air cargo industry reflects on a year of milestones, challenges, and transformation. In a detailed review presented by IATA at its annual Media Day on 10DEC24, IATA Director General, Willie Walsh, Economist, Ghislaine Lang, and Brendan Sullivan, IATA’s Global Head of Cargo, recapped the year’s results and discussed key focus areas, going forward.
Willie Walsh opened the hour-long Media session with an unprecedented forecast for the year ahead, for the aviation industry as a whole: “We expect overall revenues in 2025, to exceed USD 1 trillion for the first time.” (2024 is expected to close with USD 965 billion in revenues.) That said, costs are, of course, continuing to increase and IATA reveals a net profit of USD 36.6 billion, which – though a large figure – represents a net margin of just 3.6%. There is growth in all segments predicted: Passenger revenues are expected to grow by 4%, while cargo revenue growth forecast is 5.4%, and roughly 6% increase in Cargo-Tonne-Kilometers (CTK). Cargo yields are showing a slight decline of 0.7% for 2025. Overall, cargo operations have become increasingly vital. They now represent 15.6% of total industry revenues, up from 12% in 2019. “[Cargo] continues to represent a very significant proportion of overall revenues for the industry,” he stressed.
Passengers traffic is back
With annual global economic growth of around 3% forecast for the next 5 years, and a pretty stable growth trajectory over the past few years despite fears to the contrary, “it indicates that the global business cycle is still overall favorable for the airline industry,” Ghislaine Lang outlined in her economic summary. Passenger traffic achieved full recovery from the pandemic, this year, she said. A fact that is “relevant for air cargo, since most of the industry’s cargo is transported on passenger bellies,” she underlined.
Record air cargo demand
2024, so far (JAN-OCT24 figures were available), has marked a record year in air cargo demand. Driven by booming e-commerce and the fallout of maritime shipping disruptions, CTK reached its second-highest level ever in Q3/24, “topped only once during the pandemic in Q4/21”. Nine out of ten months, this year, achieved double-digit growth, and “we are experiencing a very strong Q4/24, and it’s slightly [sic] going to turn into a record peak season, after all”, Lang predicted, going on to state that shippers and transportation companies appear to have been very well-prepared for the peak season, this year. The annual CTK forecast stands at a “remarkable 11.8% for 2024 […] delivering an all-time high in air cargo demand”. While demand is expected to continue in 2025, it will happen at a slower pace, at 6%.
Challenges: Geopolitics, Trade Barriers, and Production Delays
Ghislaine Lang pointed to geopolitical tensions, rising trade barriers, and inflation as persistent headwinds. Over 3,000 trade restrictions – five times the 2015 level – have been imposed globally. The U.S., in particular, continues to raise trade barriers, risking retaliatory actions that could impact air cargo volumes.
Production delays for new aircraft are another looming challenge. While freighters have shouldered a significant load since the pandemic, the fleet’s reliance on older models may present constraints in the future.
Structural shifts in global production
Lang also underscored the evolving dynamics of global trade. Companies are increasingly multi-sourcing, moving production away from China to a diverse range of countries. This shift is reshaping trade lanes, with routes like Europe–North America and Far East–North America seeing strong demand.
Freighter usage remains robust, especially on transpacific routes, where reliance has exceeded pre-pandemic levels. Belly capacity is moving away from China, but freighters are moving towards it for e-commerce reasons, mostly. In OCT24, global cargo yield levels were still roughly 50% above 2019, and there are no signs that they will revert to pre-pandemic levels – again, mainly due to the boom in e-commerce. Yields are expected to remain around one-third above pre-pandemic levels in both 2024 and 2025. Still, air cargo has become more competitive against maritime shipping, with air freight now only six times as expensive as sea freight compared to 10–15 times, pre-pandemic.
The Digital Revolution and Sustainability Drive
Digitalization took center stage in 2024 – also given that e-commerce, which makes up 20% of what moves by air, demands speed and efficiency. Brendan Sullivan emphasized the growing adoption of IATA’s ONE Record standard, which aims to streamline data sharing across the supply chain. Over 200 companies are piloting the system, with full industry adoption targeted by 2026. Examples of successful implementation include multimodal tracking projects with Cathay Cargo and vaccine transportation initiatives.
Sustainability remains another top priority. IATA is pushing for zero carbon by 2050, reducing single-use plastics, and combating food loss, which costs the global economy $940 billion annually. Sullivan also flagged evolving security threats, such as incendiary devices, that require robust regulatory responses.
Outlook for 2025
2024 will likely see a 7% increase in revenues, with another 5% expected in 2025. Cargo revenue share will remain elevated at around 16%, this year and the next. Growth in air cargo volumes is expected to slow to 6.4%, but the sector’s foundational strength remains intact. Continued e-commerce demand and advances in digitalization offer promising opportunities, while geopolitical and production challenges will test resilience.
As Sullivan aptly summarized, the industry has undergone a structural transformation for the better. However, adaptability and readiness for surprises will be critical in navigating the uncertain road ahead. For air cargo, 2025 promises another year of innovation and growth, underscored by the lessons and successes of 2024.
