The International Air Transport Association (IATA) today called for further action on threevital aspects of the air cargo business: transitioning to paperless freight processes, a focus on
global handling standards for pharmaceutical freight, and tough action to ensure the continued safetransportation of lithium batteries by air.The call was made by Tony Tyler, IATA’s Director General and CEO at the opening of the 9th WorldCargo Symposium in Shanghai, China, where he also highlighted China’s strong air cargo growthpotential for the years ahead.
“Air cargo has had a challenging few years. 2014 saw the first significant boost in volumessince 2010, a trend we expect to continue this year. Revenues, however, are still down from the2011 peak, and yields are falling for the fourth straight year. I am a cargo optimist. But businessimprovement will only come by constantly improving the value of cargo. There is a long haul aheadto recapture lost revenues, nevertheless the prospects for the future are bright because theindustry is really starting to act strategically and plan for the future,” he said.
The transition to paperless freight finally saw lift-off in 2014, as the industry exceeded 24%global e-Air Waybill (e-AWB) penetration, IATA pointed out. Key to the improvement was enhancingcollaborative work across the air cargo chain and with customs authorities. A growing number ofroutes around the world now have the necessary regulatory approval, including, from November 2014,Shanghai.
“We still have work to do to help businesses transition, but there has been a big change in thementality of the industry. We can now look ahead and plan for the digitisation of other air cargodocuments, through a collaborative industry approach,” said Tyler. The industry is aiming toachieve 45% e-AWB penetration in 2015 and 80% in the following year.
Global handling standards for pharmaceutical goods will be an essential step towards air cargoimproving its share of the $60 billion a year pharma logistics market. The industry needs to meetcustomer demands for the integrity of their goods, while complying with increasing amounts ofregulation from global authorities. “If these expectations are not met, air cargo risks losing theopportunity presented by this huge market. Modal competitors to air are working hard to win thisbusiness,” he warned.
To help foster air cargo’s competitiveness in this growing segment, IATA has developed a newinitiative, the Centre of Excellence for Independent Validation in Pharmaceutical Logistics (CEIVPharma). CEIV Pharma assesses and validates cool-chain processes and provides training to guaranteethat they comply with all applicable standards and regulatory requirements. “The benefit of CEIVcertification for all organisations will be to instill trust and confidence with shippers that thesensitive goods will be handled reliably until they reach the customer,” saidTyler.
Meanwhile, the continued safe transportation of lithium batteries remains a key concern for theindustry. Robust regulations and guidance exist, but these are not being fully adhered to by allshippers, according to the airline association.
China is the largest producer of lithium batteries and therefore a key market. IATA hasdeveloped the Lithium Battery Shipping Guidelines in Chinese to raise awareness on this vitalissue, but the issue is also one for government authorities.
“Regulators need to step up. The industry is doing what it can, but without oversight,surveillance and where necessary, enforcement, compliance at the source of the shipment will belimited,” said Tyler.
In his speech to senior air cargo executives, the IATA chief also painted a rosy picture ofprospects for the Chinese market in the years ahead.
“China is already one of the leading air cargo nations, accounting for 7% of global air freight.Our current cargo forecast looks out to 2018, and again, it is good news for China. Air cargovolumes to, from and within China are set to increase by 4.9% a year over this period. This iscomfortably ahead of the global average for this period, of 4.1%. We are also seeing that thegrowing Chinese middle class is driving demand for foreign goods, which will help create a moresustainable and balanced economy. This will have beneficial effects for air cargo flows,” hepredicted.
