The world's air freight industry is looking forward to more of the same as they reckon the Elders of Davos will keep the Covid crisis going to facilitate the Great Reset to reform the world, giving credence if not reverence for every environmental fear that NGOs can imagine.
That is what emerges from a survey of major air freight concerns worldwide conducted by London's Air Cargo News. Not that this is bad news from an air cargo service provider's perspective. Not at all. Shortages of capacity from the continued reduction of passenger volume, means less space for cargo in bellyholds and soaring air freight rates.
Optimists expect there will be new Covid variants to come, insuring a continuation of this state of perpetual emergency that will keep travel volume well below pre-Covid areas, thus keeping rates cruising in the stratosphere.
Some say the futurist visions of the 1960s, when Marshall McLuhan, the communication guru of yesteryear, predicted that communications would one day largely supplant transportation in daily life, will come to pass. Current advances in this direction have severely reduced business travel whence comes airline profits and bellyhold cargo spaces.
DSV vice president and head of the DSV Air Charter Network, Mads Ravn, said he expects Covid to disrupt supply chains with bellyhold operations slow to return.
“Covid will continue to play a major role in whether capacity will return, especially on key routes from China and Hong Kong where they have some severe restrictions," he said.
“Belly carriers are trying to piece a programme together with multiple new seasonal destinations that will not necessarily benefit the lack of capacity in the market to and from core manufacturing sites.”
DSV expects normal supply and demand is a long way off. “The initial anticipation of 2025 is likely not happening and destinations serviced will change as business travel will be very slow to come back,” said Mr Ravn.
“To secure enough people on the ground is perhaps the most severe challenge in several gateways in North America and Europe,” he said.
“This combined with outdated US infrastructure and lack of staff returning to work, will also influence and slow recovery.”
Said David Wystrach, Scan Global Logistics air freight chief: “We expect the market to be pretty much the same as in 2021; travel-restrictions, no clarity about Omicron and potentially other variants to follow, and no, or only limited, additional freighter-aircraft to be supplied to the market.
“Business travellers will not be back to anywhere close to pre-Covid-times. This will limit number of flights and served port pairs," said Mr Wystrach.
“Some routes added to the network may be less cargo friendly, eg, leisure destinations on transatlantic routes.
“On top of this, the current variant will as well impact crews and pilots and with this further reductions on rotations are to be expected,” he said.
Mr Wystrach also expects ongoing labour issues across the market to affect ground handlers, forwarders, airlines and trucking companies.
Crane Worldwide Logistics CEO Keith Winters also expects labour trouble to add to the mix. “There is no question that we are still expecting some turbulent times ahead,” he said.
“Currently, new vaccine boosters need to be moved and there is still the possibility of borders closing as countries cope with the influx in cases," Mr Winters said.
Herve Bonis, deputy chief executive, Seafrigo Group, says Omicron and seafreight issues will drive demand in the air: “The overall global environment remains uncertain due to the high circulation of the Omicron variant of Covid-19 in most western countries.
“This is already impacting on air freight capacity, especially regarding the China/Hong Kong trade lanes where stringent rules for pilots are in place.
“The biggest challenge is definitely to get back to normal regarding intercontinental travel, which then brings back the belly capacity that is not currently available in the market. I expect belly capacity to increase during the second half of 2022," he said.
“Regarding our overall volumes, I consider that we will still face seafreight disorganisation, including port congestion, and this will bring opportunity in terms of air freight volumes,” Mr Bonis said.
Roger Samways, vice president commercial, American Airlines Cargo, says that despite some return of passenger flights, indicators suggest capacity shortages.
“Continued capacity shortages in the market, relative to demand, as well as infrastructure challenges at airports, will present ongoing challenges for the air cargo industry,” Mr Samways said.
“We have faced capacity shortages since the start of the pandemic, but we’ve seen innovative, creative solutions across the industry as carriers have tried to support the needs of our customers.”
Belly capacity will improve in 2022 compared with last year but won’t get back to 2019 levels due to changing government travel restrictions and possible future Covid-19 outbreaks, he said.
“Our current expectations are that widebody capacity will grow around 20 per cent compared to 2021. The key for our cargo customers, though, is where that capacity is going to be deployed.
“Unlike in 2021 when many of our widebody aircraft were operating on short-haul leisure markets, such as the Caribbean and Mexico, in 2022 our widebody fleet will primarily be deployed on long-haul international markets which are great news for our cargo customers,” Mr Samways said.
Charter brokers also braced themselves for a busy year. Dan Morgan-Evans, group cargo director at Air Charter Service (ACS), said the disruption experienced over the last couple of years has been too great to unwind completely during 2022.
“The longer time goes on, the more balanced it will become but we are still seeing very strong demand in the short term and long term, with a record number of forward bookings even into 2023.
“The whole supply chain has changed over the past two years and, unless we suddenly revert to pre-pandemic passenger numbers and all travel restrictions are lifted, then we will continue to see strong demand,” Mr Morgan-Evans said.
He said his company was previously used to seeing single ad hoc flight bookings with the occasional programme for multiple flights. Now, the company is seeing bookings that are predominantly programmes.
“The challenges will be similar,” he said. “Covid restrictions, lack of capacity, bottlenecks at airports – but these are all the benefits of using a company like ACS."
Said Chapman Freeborn chief commercial officer Neil Dursley: “What we are seeing is more of the same - a distinct lack of widebody availability and supply chain challenges impacting the major ocean ports of the world with new restrictions due to Covid.”
Mr Dursley reported a surge in demand for Covid test kits. The broker has just completed “an enormous programme of flights” utilising multiple AN-225 and AN-124 flights.
“Never before in our history, or I believe in the history of the AN-225, has it ever operated so many back-to-back missions,” he said.
Freighter operator Magma Aviation, a Chapman Freeborn unit, continues to operate at full capacity to and from a range of origins.
Perhaps it is time to consider what's to be done in the case of future so-called emergencies, with a complete post mortem on how and why initial expert predictions were so mistaken - and how we might avoid a repeat performance and be guided by a modicum of rational risk assessment.
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