Cargo Demand Strains Air Freight Capacity

Currently, Shein is shipping around 5,000 tonnes, Temu about 4,000 tonnes, TikTok – 800 tonnes, and Alibaba – 1,000 tonnes, which is the equivalent of 108 Boeing 777 aircraft daily. Consequently, e-commerce companies occupy more than 30% of available capacity, particularly in routes heading from Asia to Europe and the US. This surge in demand has led to increased competition for aircraft space in southern China, a major industrial region. As a result, in June 2024, air cargo rates were 40% higher than in 2023, an unusual spike for a typically quieter summer month.

Adjusting Strategies Amid Rising Air Freight Costs

In response to the growing demand by e-commerce, some airlines are increasing their charter capacities which have been predominantly booked for extended periods. Temu, on its own, is not only consuming capacity but is in the process of leasing 12 freighters, actively searching the market for any available aircraft.

However, the sustainability of this air-freight model for e-commerce is questionable in terms of profitability. This uncertainty arises mainly due to the high operational costs associated with air freight which include fuel, maintenance, and leasing expenses. As competition drives costs even higher, companies like Shein and Temu are already seeking different shipping solutions and local warehousing options. Both companies are shifting towards sea freight as an alternative and are strategizing to set up warehouses beyond China’s borders to shorten delivery times to various markets. In fact, Shein has already begun distributing goods to U.S. warehouses to expedite shipping times.

Such facilities can be used for products that have consistent and predictable demand patterns. These products are ideal candidates for bulk shipment via sea freight because they can be stocked in advance at major storage and distribution centers in Europe. For fast-selling or trending items, e-commerce giants could adopt a flexible air freight strategy. Due to their unpredictable demand, air freight might be necessary to swiftly replenish these products from China to distribution centers or directly to consumers when required.

Additionally, e-commerce giants could provide suppliers with direct access to their sales data, inventory levels, and demand forecasts. This would enable manufacturers to adjust their production schedules to align more closely with actual demand. This tighter integration would reduce the likelihood of overproduction and excess inventory which are costly for suppliers.

Storing unsold goods can be expensive, and suppliers frequently have to offer deep discounts to clear excess inventory. With enhanced planning, they can decrease the production of such slower-moving products and focus on manufacturing items that are in high demand and should be restocked more promptly.

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Designated Storage Facilities

Airports use designated storage areas to safely store hazardous goods based on the type and potential risks. For example, flammable liquids such as gasoline, solvents, and paints require storage in fire-resistant facilities equipped with high-airflow ventilation systems, which effectively disperse hazardous vapors to prevent them from accumulating. Meanwhile, explosive materials such as fireworks, ammunition, and industrial chemicals like sodium and potassium are stored in blast-resistant containers or buildings located at least 300 meters away from passenger areas and other cargo.

Safe Transport Vehicles

Specialized transportation vehicles are used to move hazardous materials safely within and around airport premises. Their design incorporates safety features specific to the materials they carry. For instance, flammable liquids expand as they heat up, which can create pressure within the vehicle and lead to ruptures and leaks. To prevent this, tanks for transporting flammable liquids are made from materials that withstand high temperatures, such as high-strength steel or specialized alloys like aluminum alloys or stainless steel.

Corrosive substances also pose their own risks during transportation at airports. Cargo such as sulfuric acid used in batteries and sodium hydroxide found in cleaning products can react aggressively with metals, rubber, and certain plastics. Because of this, vehicles for transporting corrosive items are fitted with linings made from heavy-duty plastics or non-reactive coatings like fluoropolymers, which prevent the vehicle’s interior from corroding.

Furthermore, these transport vehicles are equipped with sensors that continuously monitor for signs of fire, such as smoke, heat, or flames. These sensors are installed in areas where fires are most likely to start or spread, such as cargo holds and near storage compartments. When the sensors detect a fire, they activate suppression equipment with agents suited to the materials being transported. For flammable liquids like gasoline and diesel, the equipment uses foam to form a barrier that severs the supply of oxygen needed for the liquid to continue burning. For metals like magnesium or titanium, the equipment may deploy powders that disrupt the chemical reactions sustaining the fire.

Handling Equipment

Equipment used for handling hazardous materials typically includes forklifts, pallet jacks, and conveyor systems, each equipped with specific safety features. Forklifts, for example, are fitted with a sealed compartment for the engine to contain any sparks or heat that could potentially ignite flammable substances. Pallet jacks have wires attached to both the jack and the cargo to bring them to the same electrical potential. This helps prevent the buildup of static electricity, the discharge of which might ignite flammable or explosive substances. Lastly, conveyor systems are designed with enclosed tracks or covered belts to reduce the chance of airborne particles escaping, which could lead to a fire or explosion.

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Competitive Pricing

Smaller airports can offer lower landing, storage, and handling fees for several reasons. First, their location away from major urban centers means that land and development costs are significantly reduced, which makes it less expensive to build airport facilities. Second, with fewer flights to manage, small airports face less competition for resources such as runway slots and terminal space. This decreased demand allows them to utilize their facilities without the need for costly expansions. Third, small airports incur lower maintenance costs because the wear and tear on runways, terminals, and support infrastructure is less intense compared to busier hubs. These factors enable them to provide more competitive pricing to European logistics companies.

Specialized Cargo Handling

Some secondary airports are equipped to handle specialized cargo types such as perishables, delicate equipment, and hazardous materials, often outperforming busier primary airports. This is mainly due to the availability of space which allows for the installation of specialized facilities. For example, isolation areas can be set up for genetically modified organisms, viral cultures, and biological toxins to ensure they are contained and do not cross-contaminate the local ecosystem or other cargo. Additionally, anti-vibration platforms may be available to move delicate instruments such as high-resolution microscopes or precision laser measurement systems which require stability to maintain their calibration and functionality.

With such specialized areas available, smaller airports can control shipments more precisely which for forwarders means satisfying client demands more effectively.

Shorter Taxi Times

In major airports, a single aircraft might spend 30 minutes or more navigating through a complex web of often congested taxiways, contending with other aircraft that are either waiting to take off or just have landed. By contrast, secondary airports have fewer runways and taxiways and aircraft may spend as little as 5 to 10 minutes taxiing. They also experience less traffic which allows planes to quickly move to a cargo bay for offloading, reloading, and dispatch.

This streamlined process directly benefits ground forwarders as shorter taxiing times and quicker cargo processing improve their ability to meet tight delivery schedules.

Comprehensive Checks

Due to the lower number of flights and reduced cargo volumes at secondary airports, personnel can conduct more detailed checks such as manual inspections of cargo, the deployment of sniffer dogs, and even comprehensive background checks on the entities sending and receiving the cargo. These checks can involve confirming the legal existence and business licenses of the companies involved in shipping and receiving goods. Additionally, background checks may include an examination of the historical shipping activities of the involved parties, which can reveal patterns indicative of improper dealings. Issues such as frequent shipments to high-risk countries, discrepancies between the declared and actual contents, and other suspicious activities might raise serious concerns.

Such stringent measures benefit forwarders by minimizing the risk of inadvertently handling non-compliant cargo which ensures their operations adhere to legal and safety standards.

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Cargo Containment Solutions

Cargo aircraft carrying dangerous materials are typically equipped with fire-resistant containers and spill containment pallets to ensure safe transportation.

Fire-resistant containers are used to ship dangerous goods that are flammable, explosive, or highly reactive, including materials such as nitroglycerin, picric acid, and sodium. These containers are constructed from advanced materials such as high-grade steel or reinforced aluminum that offer both durability and resistance to high temperatures, typically up to 1,200 degrees Celsius. They are also designed to seal tightly and prevent any leakage of fumes that could potentially ignite or explode. The sealing mechanism is usually a combination of gaskets made from chemical-resistant materials such as Viton or silicon and locking mechanisms that create an airtight and liquid-tight seal.

In addition to these specialized containers, aircraft are also equipped with spill containment pallets designed to manage any accidental leaks or spills from containers. If containers are compromised, either due to damage or improper sealing, the spill containment pallets catch the leaking substance. The design of the pallets itself is intentionally focused on leak containment: each features a flat platform with raised edges that confine spills within the platform’s boundaries. Above this secure base, a removable grating allows spilled liquids to drain and be safely collected below. The grating also supports the containers and keeps them elevated above any accumulated liquid.

Cargo Safety Systems

Shock sensors and load monitoring systems help detect any potential disturbances that might compromise the safety of the cargo. Shock sensors, in particular, are designed to detect and record impacts and vibrations that can occur while the plane is in the air. These sensors are highly sensitive and can distinguish between normal flight vibrations, routine turbulence, and a sudden drop due to air pockets. Upon detecting such an anomaly, the crew can take corrective actions, such as adjusting the aircraft’s flight path or speed to smoother conditions.

Load monitoring systems further enhance safety throughout the flight. Equipped with load cells and balance sensors, these systems continuously assess the weight distribution and stability of the cargo. When these systems detect shifts that could destabilize the aircraft, they alert the crew to take action, such as adjusting the load if possible or altering the flight dynamics to compensate for the shift.

Fire Suppression

Crafts shipping hazardous goods are also equipped with specialized fire suppression systems tailored to the types of dangerous goods on board. For instance, flights carrying volatile chemicals like acetone and methanol may have gas-based suppression systems. These systems release inert gases that absorb heat and displace oxygen, thus halting the combustion process. In contrast, aircraft transporting flammable solids such as fireworks or matches employ suppression systems that release powders. These powders spread over the surfaces of the combustible materials and prevent air from reaching the material and fueling the fire.

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Large Cargo Aircraft

At night, airports can better accommodate large aircraft due to decreased passenger flight schedules. With fewer passenger flights, airports can allocate longer time slots for large aircraft that carry substantial loads and require more time for loading and unloading. Additionally, they often transport oversized cargo and irregularly shaped items, which extends the process because such cargo does not fit standard conveyors or handling systems. This often requires specialized equipment like heavy-lift gear or high-capacity loaders to move these bulky items.

Furthermore, with reduced passenger traffic, longer runways are more readily available. This availability enables the operation of large cargo aircraft, which require more runway length for safe takeoff and landing.

With airports capable of accommodating larger aircraft at night, the number of flights needed to transport large amounts of cargo is reduced. This, in turn, lowers operational costs for ground forwarders.

Nighttime Temperatures

Cooler nighttime temperatures enhance aircraft performance. Cooler, denser air improves the lift of the wings and allows aircraft to achieve higher climbs that are more fuel-efficient. Cooler air also increases the efficiency of engine performance, which further supports better fuel economy. These fuel savings that benefit airlines at night are then passed on to ground forwarders as reduced operational costs.

Steadier Winds

Additionally, the reduction in wind variability at night minimizes the risk of crosswinds and turbulence upon takeoff and landing. This provides a safer and more stable environment for aircraft, especially large cargo planes that are more susceptible to adverse weather conditions due to their size and weight load. For forwarders, this stability means fewer delays and more predictable schedules that allow for smoother coordination of ground operations.

Enhanced Security

The reduced human traffic and quieter environment at night allow security personnel to concentrate better without the distractions typical of daytime hours. This heightened focus allows them to monitor for any suspicious activities and security breaches.

Furthermore, airports typically increase the number of security patrols at night to counter the increased risks associated with lower visibility. Nighttime also offers more opportunities for unauthorized activities because there is less natural surveillance from bustling crowds. Therefore, increasing patrols ensures that critical areas like cargo and restricted zones are continuously monitored.

For European logistics companies, this enhanced nighttime security means their shipments are safer, with a lower risk of theft and damage.

Shipping Temperature-Sensitive Items

Cooler nighttime temperatures are ideal for transporting temperature-sensitive items like pharmaceuticals and perishable goods, which require stable, cool conditions. Shipping these goods at night not only maintains their quality and effectiveness but also cuts down on the need for energy-consuming and costly artificial refrigeration systems.

Using nighttime for shipments also benefits forwarders by reducing both the likelihood of cargo damage and the costs associated with cooling systems.

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Meeting Urgent Delivery Deadlines

Air charter services stand out for their unmatched ability to speed up delivery times. Unlike traditional air freight in Europe, which must adhere to the pre-set schedules and routes of commercial airlines, air charters fly directly to the closest airport to the destination.

This speed is not just beneficial but critical for emergency shipments of medical supplies, transportation of high-tech equipment or prototypes, and rapid inventory restocks during peak retail seasons. For emergency medical supplies, these services are key for rapidly delivering specialized equipment for emerging health threats. This includes mobile laboratories, ready-to-deploy field hospital units, and isolation chambers equipped with negative pressure rooms. Additionally, these services facilitate the fast movement of high-tech equipment and prototypes for industries like aerospace for satellite parts, automotive for cutting-edge battery technology, and tech startups for next-gen computing hardware. Such industries often rely on air charters to maintain a competitive edge by ensuring rapid development cycles.

This same expediency applies to retail, particularly during critical sales periods. Beyond serving the needs of mainstream sectors like agriculture or the textile industry, charters cater to highly specialized sectors that demand careful timing. For instance, charter services can aid the quick restocking of rare botanicals for luxury cosmetic brands ahead of festive seasons. Similarly, they play a role in the timely replenishment of sports equipment for international competitions, where having the right gear on time can be key to the participants’ performance.

Accessing Remote Locations

Air charter services are invaluable for reaching remote or hard-to-access locations that European logistics networks often cannot serve. In the mining industry, for instance, operations are frequently based in remote parts of the world like the Arctic Circle or the Australian Outback. Here, air charters provide a lifeline by delivering necessary machinery, parts, and even personnel directly to these secluded sites. In the oil and gas industry, exploration and drilling activities can also take place in remote locations like offshore oil rigs in the Brazilian Pre-Salt region and remote oil fields like those in Alaska’s North Slope. Air charter services are often used for the transportation of personnel, equipment, and supplies to these distant sites.

Handling Oversized Cargo

The versatility of air charter services extends to the handling of oversized cargo, which is often impractical or impossible to transport via traditional air freight due to size, weight, or shape constraints. In the construction industry, for example, air charters efficiently transport large prefabricated components, including bridge sections, oversized structural beams for skyscrapers, and massive concrete panels that form the exteriors of modern buildings. In aerospace and space exploration, air charters are often used to deliver satellite components, spacecraft parts like heat shields and gyroscopes, and sensitive equipment such as telescopic mirrors and atmospheric sensors. Given the exacting schedules required for such cargo, the ability of air charters to swiftly transport these items makes them a preferred choice.

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Career Development

The appeal of passenger airlines largely stems from the wide range of career development opportunities available. Pilots in passenger aviation have the chance to fly a variety of aircraft, from smaller jets suited for regional services to larger aircraft designed for international flights. This variety enables pilots to familiarize themselves with various aviation technologies. Moreover, the route networks of passenger airlines often cover more destinations which allows pilots to gain experience with a variety of flying conditions.

In contrast, pilots in commercial aviation have experience with a narrow variety of aircraft. This is because airlines primarily focus on utilizing specialized cargo aircraft and cargo-configured aircraft originally designed for passenger service. They also operate on less diverse networks due to the strategic placement of industrial and commercial hubs. This can lead to repetitive routes that offer less exposure to a wide range of flying experiences.

Training Programs

Passenger airlines offer a variety of training programs that go beyond the basic requirements for flying. These programs can include advanced simulation training for specific aircraft types, crew resource management, and emergency response preparedness, among others. In contrast, cargo pilot training is narrower and mainly focused on the efficiency and safety of cargo delivery. It can include specialized loading techniques, freight security procedures, and the transport of hazardous materials.

Quality of Life

Pilots with passenger carriers usually have predictable schedules, as flights follow established timetables based on passenger demand. Airlines operate on fixed routes with flights scheduled at consistent times, which enables pilots to anticipate their workdays and off days in advance. Additionally, to enhance passenger satisfaction, these flights mainly occur during the daytime, which offers pilots a routine mirroring a conventional workday.

Contrastingly, cargo pilots navigate a less predictable schedule. As European cargo airlines must respond swiftly to market demands, this can lead to changes in scheduling and routes with less notice. Moreover, cargo flights are frequently timed at night to bypass busy air traffic and airport congestion. This results in more irregular working hours for pilots.

The Freight Forwarders’ Response to Pilot Shortages

The preference of pilots for passenger airlines strains cargo operations with notable pilot shortages. This shortage often results in unpredictable cargo flight availability and leads forwarders to deal with frequent scheduling adjustments and limited cargo capacity. As a consequence, forwarders may be forced to resort to last-minute logistical solutions. They might secure spot market air freight, which involves purchasing cargo space on flights at the last minute, often at premium rates. Additionally, they can utilize integrated transport, such as combining air and truck transport, to transport cargo to a less crowded regional airport where air transport is available.

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Modern Runway and Taxiway Systems

A major infrastructural improvement in air freight forwarding is the modernization of runway and taxiway systems at airports. Enhancements involve LED lighting for improved visibility, upgrading the runway surfaces, and installing ground radar systems for managing aircraft movements on the tarmac. For ground forwarders, this translates into fewer delays and more predictable schedules and allows for better planning and coordination of ground transportation. Enhanced runway systems also improve the safety of cargo handling, especially for sensitive or high-value goods.

Air Traffic Control Systems

Modern air traffic control (ATC) systems feature radar systems for tracking aircraft in flight, communication systems for air traffic controllers to guide pilots, and automated systems for managing flight paths and ensuring safe distances between aircraft in the air. These improvements streamline the management of air traffic and reduce in-air delays. As a result, ground forwarders enjoy more predictable cargo arrival times, which further enhances their ability to schedule ground transportation and labor

Moreover, advanced air traffic systems allow for better monitoring of traffic, which reduces the risk of mid-air collisions. This heightened safety supports the secure transport of hazardous goods and delicate cargo.

Advanced Cargo Handling Systems

Automated systems such as conveyor belts, automated guided vehicles (AGVs), and robotic loaders expedite loading and unloading and speed up cargo turnover. For ground forwarders, this efficiency minimizes waiting times at the airport and optimizes the turnaround time for cargo trucks. Additionally, such facilities often incorporate better tracking systems, which ensure more accurate and real-time updates on cargo status. This improvement is especially beneficial for time-sensitive shipments, as it allows for the swift processing and transportation of urgent deliveries.

Cargo Screening Systems

Airports are upgrading to advanced cargo screening technologies, including high-resolution X-ray machines, CT scanners for detailed imaging, and explosive trace detection equipment. These technologies allow for more rapid screening, which, in turn, enables the handling of larger volumes of cargo. Ground forwarders benefit from a smoother and faster transition through security checkpoints, which streamlines the logistics process.

Expanded Cargo Facilities

Larger, more sophisticated cargo terminals enable the handling of increased volumes of freight, which helps accommodate the growth in air freight traffic. These facilities also feature specialized storage areas, including temperature-controlled zones for perishable goods, dedicated spaces for hazardous materials, and customized sections for irregularly shaped or oversized cargo. For ground forwarders, this means improved capacity and flexibility in handling a variety of cargo types, which leads to more efficient processing and transit.

Eco-Friendly Infrastructure

Airports are increasingly adopting eco-friendly infrastructure like energy-efficient lighting and water conservation systems, alongside renewable energy sources. For forwarders, this shift opens opportunities to collaborate with airports, including joint sustainability programs and the use of shared green facilities. Such partnerships support their corporate responsibility objectives and bolster their brand image.

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Biometric Access Controls

Unlike traditional security methods, biometrics such as fingerprints, iris scans, and even facial recognition offer a level of precision that is nearly impossible to replicate or forge. This makes biometric controls exceptionally effective in ensuring that access to sensitive cargo areas is strictly limited to authorized personnel.

Furthermore, the use of biometrics in air transport security streamlines the process of access control. It reduces the need for manual checks, keys, or access cards, which can be lost or stolen. By simplifying the access process while enhancing security, biometric systems improve safety and operational efficiency.

CCTV Systems

The effectiveness of CCTV systems in air transport security is attributed to their ability to offer continuous and detailed surveillance of cargo areas. Integral to these systems are high-definition cameras, which not only capture clear imagery but offer zoom capabilities. This feature allows security personnel to focus on specific areas or objects for closer inspection. Advanced cameras equipped with night vision or thermal imaging capabilities ensure that surveillance is effective even in low light conditions, which is especially important in 24/7 operations like air transport.

Security Checkpoints

Security checkpoints at airports are the first line of defense in ensuring that only authorized personnel and vehicles gain access to sensitive cargo zones. Each person passing through the checkpoint undergoes identity verification so that access is restricted to those who have clearance.

Additionally, vehicles are meticulously inspected at these checkpoints. Security teams examine both the interior and exterior of vehicles for any signs of tampering or concealed items. They verify that the contents of the vehicle match the cargo documentation, an essential step to prevent smuggling or theft.

The effectiveness of checkpoints is significantly enhanced by the specialized training and expertise of airport staff. Personnel are trained in various security protocols, including threat identification, behavioral analysis, and emergency response. Behavioral analysis, in particular, equips staff to observe and interpret body language and behaviors that might indicate potential security threats. Such behaviors include nervous actions, inconsistencies in responses, unusual interest in sensitive cargo areas, or attempts to evade security measures. These subtle cues, from excessive sweating to evasive answers, help pinpoint persons who might pose a risk to the safety and security of the airport’s cargo operations.

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Advanced Cargo Tracking with IoT

Integrating IoT (Internet of Things) technology into air freight forwarding has significantly improved cargo tracking. IoT devices, including sensors and RFID tags, now offer real-time updates on cargo location and condition. This is particularly beneficial for shipments that are time-sensitive or condition-critical, including transport of perishable goods needing timely delivery, pharmaceuticals requiring constant temperature control, and high-value electronics sensitive to both time and environmental factors. This tracking capability enables carriers to monitor onboard conditions and anticipate potential transit delays, which effectively reduces risk for freight forwarders.

Automated and Robotic Systems

Technologies such as high-speed automated sorters, robotic palletizers, and self-navigating forklifts are transforming how cargo is processed. High-speed automated sorters, for instance, can rapidly organize cargo based on destination, size, or type, while robotic palletizers stack goods for transport and ensure optimal space utilization and cargo safety. Self-navigating forklifts and drones in large warehouses further streamline the movement and tracking of goods.

The adoption of these advanced technologies enables freight forwarders to enhance their reliability and capacity and meet client demands more effectively in the dynamic market of air freight in Europe.

Telematics

Telematics technology provides real-time data on aircraft performance, including aircraft location and flight paths. This information is important for ground freight forwarders to ensure their operations are in sync with airline schedules. Access to up-to-date data on flight arrivals and departures allows them to plan and execute cargo handling more efficiently. This helps minimize delays and ensures a smoother flow in the supply chain.

Digital Freight Platforms

The rise of digital freight platforms has significantly changed the way air freight forwarders and shippers connect. These platforms aggregate information from multiple carriers and provide forwarders with a comprehensive view of available flight options. Logistics operators can filter them based on criteria like flight schedules, cargo space availability, and cost efficiency. The automated nature of this process speeds up booking and reduces the likelihood of errors that can occur with manual data entry and communication.

3D Printing

The use of 3D printing in the manufacturing of aircraft parts has streamlined the maintenance process. Traditionally, airlines stock a wide range of spare parts, such as turbine blades and fuel nozzles which are known for long lead times.

3D printing allows for the on-demand production of parts which shortens repair wait times and enables more efficient maintenance. As a result, aircraft spend less time grounded, and more time is available for flights. This situation creates a more predictable flight schedule for forwarders and allows for more efficient planning of their operations. Additionally, with less investment in inventory, airlines can potentially pass on these savings to forwarders in the form of lower freight charges, which in turn enables them to offer better rates to their clients.

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