1. Covid-19 has exposed the fragile face of the air cargo industry. What is your view on creating a new business model which is tech-driven and will prepare the industry for all future shocks and pandemics?
There is no doubt that airlines are shocked and decimated financially due to their inability to cope with a pandemic, yet air cargo stood out in its value in supplying needed medical and components to keep the industries working. 60% of all cargo was in passenger bellies pre COVID, all of a sudden that was gone, now, major airlines who fly so-called Pfreighters (pax aircraft, cargo only) to try and generate some needed revenue are the most profitable divisions. My question to any CEO’s of airlines reading this; has this convinced you to make cargo now a core business going forward, were any lessons learned?
The most underrated product in air cargo is sitting beneath every passenger’s feet, belly cargo space on a direct flight between any two airports, especially those that operate on intercontinental and longer-haul routes. Nothing Fed Ex, UPS, DHL Express, Amazon and Ali Baba offers as a product can be moved, faster than on a direct flight to its destination. The missing elements for our industry to exploit this advantage is all on the ground, at airports and with GHA. The major key missing element is Cargo Community Systems and compliance with paperless technology. The entire Logistics world works that way except us, scheduled carrier cargo capacity which is direct and point to point is flawless in potential. Yet, is the only means of transport that is so fractured it cannot see what is about to hit them or the opportunity this USP presents. The world has changed, hopefully, we are ready to change and embrace technology.
2. You have been an enthusiastic supporter of Airport Cargo Community Systems (ACS). How do you see it influencing the future of Air Cargo Industry?
Airports have always built warehouses based on “Dwell times” meaning how long cargo dwells in that facility. In present times, air cargo should not dwell any longer than a few hours. Transit cargo should be handled with the same rapidity as passenger baggage, the solutions are there, we know how to do it, and it will happen. ACS is a major part of the solutions in a new business model. It can comply with demands for assurance of Time, Transparency and only then Price. The airports have to make cargo facilities as their marketing tool for their clients, the airlines and GHA tenants to stay competitive and relevant.
Governments are moving with speed to promote trade facilitation; security regimes are being tightened not just for terrorism but also economic security reasons. If the airports are to serve their major clients, the airlines, they must give them the capability to introduce high-value products and verticals such as e-Commerce, express, and cool chain. There is only one way to do that effectively, through automation and sophisticated data systems such as an ACS and In my opinion, it should not be optional. The greater good of that airport’s a total community should take precedence.
3. e-Commerce is one of the biggest opportunities for air cargo. But due to lack of focus the industry is yet to respond to this opportunity optimally. What are your view points on the same?
We were seeing a changing landscape for global air logistics before COVID, and anyone who did not use and appreciate the benefits as a consumer of e-Commerce products certainly understands it well now. What COVID- 19 has done is advance the business case for e- Retailers and platforms that cater to that business such as Amazon and Ali Baba by 3 to 5 years from prior expectations. B to B business was approx. 70% of traffic before COVID and B to C 30%. Major integrators now report its more like 50/50 a huge shift in consumer behaviour for normal consumers like you and me. Will we go back to shopping in Malls or the High Street after COVID? Perhaps for the social experience but no one is going to return to the ways of old.
To date, the primary air logistics beneficiaries of the e-commerce boom have been the integrated express carriers (e.g., FedEx, UPS, DHL) and e-commerce retailers’ in-house air operations (e.g. Amazon Air). Passenger airlines now have an important opportunity to penetrate this market. To do so effectively, however, they will need to offer specialized processing services tailored to e-commerce, including enhanced tracking and tracing, rapid clearance, last-mile delivery, and — above all else — speed and reliability in delivery from end to end. Cargo revenue is as much a function of value of the cargo, as volume. Passenger airlines have an opportunity to attract the highest value commodities, which can generate significantly greater revenue, by focusing on the quality of the services offered.
4. You have been essaying quite a few training programmes for the Aviation industry. Would you like to elaborate on them?
Data exchange capabilities resulting in solutions offering speed, transparency and quality for airlines and airports are paramount. Strategic Aviation Solutions International (SASI) in response to the unprecedented changes required in Air Logistics has been building successful content for the original training. SASI has been adding extensive material on economic sustainability for all stakeholders in the air logistics chain, with the emphasis on airlines, airports, GHA and GSSA, beneficial cargo owners, forwarders and any other stakeholders participating in a possible seamless solution, and CILT U.K certified (The Chartered Institute of Logistics and Transport Professional). SASI has also provided training and learning programs directly with individual entities such as Air Canada, Southwest Airlines, Hawaiian Airlines, WFS Americas.