Ukraine war and omnichannel reshaping air freight, say execs

SOARING air cargo revenues hit a record US$175 billion in 2021 - compensating for the $51.8 billion lost on the passenger side, and the air freight sector expects revenues to remain much the same in 2022, reports the UK's Supply Chain Digital.


But big air freight profits do not explain the profound changes the industry is undergoing. Air freight providers are now looking to service the omnichannel model that most retailers are moving to.


Increasingly, airlines are looking beyond traditional airport-to-airport services and are insteadUkraine war and omnichannel reshaping air freight, say execs - CNXtrans Shipping News considering opportunities to provide end-to-end services ??something that has powerful implications for global logistics.


One such is Lufthansa Cargo with revenues of EUR3.80 billion (US$3.89 billion) and a transport performance of 7.2 billion freight tonnes kilometres in 2021, it is one of the world's leading air freight transport companies.


Lufthansa Cargo chief Dorothea von Boxberg said demand "remains unbroken", and adds that the company's most important goal "remains offering our customers sufficient capacity on the routes that are most important to them".


Increasingly omnichannel routes are being used to service the ongoing ecommerce boom, which has also driven the collective move to omnichannel.


Ms von Boxberg revealed that, since March 2022, the company has been supplementing its intercontinental network with a medium-haul network. "We serve these routes with smaller A321F freighters operated by Lufthansa Cityline," she said.


"By entering this market, we are responding to the continued growth in demand from the e-commerce industry, enabling us to offer customers even more capacity and additional fast connections.


"We are now beginning to offer same-day e-commerce solutions within Europe and to selected medium-haul destinations.


"The new aircraft will serve a wide range of customers and routes, both scheduled and charter. We are pleased to provide much-needed capacity in the European market and further strengthen our position as the leading air cargo carrier in Europe."


Another serious headache for air cargo carriers is the war in Ukraine, which has seen airspace over Ukraine, Russia and Belarus closed to commercial traffic.


Ms von Boxberg agrees that the war has posed serious problems. "Since the outbreak, Lufthansa Cargo has been flying on a southern route around Russia and Ukraine," she says. "This results in longer flight times, and we've had to adjust our flight schedules. European airlines like us now have longer routes and less payload.


Payloads on aircraft destined for Japan, China and South Korea have had to be reduced, "by as much as 20 per cent " she reveals, but adds that the company "does not expect a short-term shift in freight flows, as production sites cannot be relocated quickly".


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Ukraine war and omnichannel reshaping air freight, say execs
Ukraine war and omnichannel reshaping air freight, say execs