This Market Advisory comes directly from TOC Logistics’ Vice President, Jennifer Coulter-Lissman, who attended the 2022 AirCargo Conference. Below, she shares her thoughts about the panel she participated on.
This month, I attended the AirCargo Conference, an annual event hosted by the Airforwarders Association, a trade association to which TOC Logistics belongs. The event was in-person for the first time since Nashville in January, 2020—one of the last events held and that we attended before things…changed.
Aside from networking with nearly five hundred industry professionals and catching up on their lives, businesses and how they’ve adapted, I was asked to participate in a panel discussing airport congestion—what has transpired and what we expect in the future. The panel included representation from a major U.S. ground handler, airport consultant, trucker, airport and was moderated by a former forwarder.
This week, if there was any doubt whether or not air cargo was back and in demand, IATA reported that the industry was up 6.9% in December compared to the pre-pandemic period two years prior and more than 18% higher than 2020. This comes on the heels of a two-week passenger flight embargo in Hong Kong from select countries and escalating tit-for-tat COVID-restriction cancellations between the U.S. and mainland China.
The panel discussion came at a perfect time, with the forwarders like TOC, airlines, ground handlers and truckers in the room all looking for answers in the face of continued demand pressure. From TOC Logistics’ point of view, I shared some of what we realized was happening, how we tried to alter our shipping patterns and behaviors and what our plans remain moving forward.
It was just a matter of minutes into the panel’s discussion that there was unanimous support for the fact that the collective “we” have to do something—and I offered technology—a suggestion readily agreed upon by everyone in the room.
We quickly came to the realization that regardless of how much money we paid an airline to move our clients’ cargo, there was no amount of pressure we could apply to get it made available faster when it arrived at an overcrowded, overwhelmed ground handler in a major gateway city. We pivoted, seeking opportunities and lift into secondary cities or smaller, cargo-centric airports that while further away meant extra domestic trucking costs we traded for more rapid availability.
In our quest for different airports of arrival, we were also sharing the fight for space at origin was owing not just to non-traditional products moving by air, but that passenger flights have not yet returned to pre-pandemic levels. This means that belly space—the traditional carrying conveyance on the north Atlantic and from many Asian airports—is spartan to non-existent. That puts pressure on cargo-only airlines and leads to working with charter operators whose rates have reflected the scarcity of supply and overwhelming demand.
At TOC Logistics, we are committed to making the most informed decisions we can for our customers while looking in the mirror and challenging ourselves to find places where we can be better. We’re investing in technology and automation that afford us better visibility, enabling smarter decision making and preparedness and identifying potential delays that could derail a shipment’s reliable, scheduled transit.
The fact that our industry’s events are resuming in 2022 is a positive sign. These events bring together many of the vendors we and our customers jointly rely on to be successful. As our senior leadership attends these events to both catch up and have frank discussions with companies from whom we are demanding better service, TOC Logistics is committed to delivering on solutions our customers look to us to provide.