Air Freight Takes Off
It’s tough to dispute that 2010 has become a really difficult year for transportation, freight, cargo and logistics industries. Many carriers, steam lines, railways, and truckers have been faced with decreased freight volume, slim earnings, and many have faced hard layoffs. Just one segment of the marketplace has performed amazingly well on the other hand: Air Freight.
Air Freight volumes have risen almost 40 percent through the first six months of 2010. Global freight trends have suggested that Air Freight, and Freight Forwarding have skyrocketed at almost three fold the rate of ocean forwarding (ship cargo) with regard to the first half of 2010, to the satisfaction of many air freight management. Many freight forwarders would welcome the steep rise in volume following 2009 which in turn demonstrated to be a year of contraction in shipping and freight tonnage.
Transport Intelligence has reported that Air Freight is actually up over 38% during the first six months of 2010, whereas Ocean Freight Forwarding is increased just 13 percent. Despite the fact that all would embrace any positive increase in volumes at this point, the point that Air Freight made these significant gains in comparison to Ocean Cargo leaves the marketplace in a holding pattern when waiting in order to see if freight distribution will come back to a lot more traditional levels. Transport Intelligence is convinced the actual increase in these trends followed by freight carriers and cargo shiplines decision to limit capacity is undoubtedly putting pressure on shippers and their third party logistics companies to pay increased costs of operations.
The Annual Global Freight Forwarding Report written by Transport Intelligence spotted an increase in volume for the transportation marketplace felt by freight carriers, which actually followed a 23 percent decline in 2009 from 2008 shipment volumes. It appears this volatility in freight has not been easy to accept for freight forwarders and cargo carriers. Just six months ago many of these third party logistics providers and airlines were concerned about exactly how to maintain operations at lean personnel levels and now they are actually slammed with far more business they can handle with existing resources.
The freight marketplace is ready for a leveling period back to more traditional freight volumes and absence of this kind of volatility. Most manufacturers have forgone conventional supply chain inventories because of to a variety of factors such as absence of accessible business funds. The lack of inventory helps to explain the increase in air freight traffic. It seems that inventories will come back to normal levels throughout the up coming few years. Transportation Intelligence feels it will take until 2013 to be able to come back to pre-2013 levels especially in Europe.
Greater Security of Freight Cargo poses minimal difficulties throughout initial week of enforcement.
This week, the national laws requiring 100 percent scanning of air cargo moving on passenger aircraft went into effect. Almost all Freight Forwarders experienced little if any impact, since much more than 95 percent reported no difficulties during this first week. More than 709 surveys were sent to the Air Freight Association looking to obtain feedback relating to the actual simplicity of integration. Only five percent of participants reported major complications adhering to the new legislation, which in turn were not correlated to any particular airline nor any airport.
The transition came at a particularly excellent period for the air freight marketplace as August is generally a slower month for airlines and freight carriers. The AFA attributes this smooth transition to the educational efforts and readiness procedures set forth by the AFA, federal government, as well as a lot of freight forwarders to ensure integration has been done correctly.