Cargo Makes the World go Round
Updated: Mar 31, 2021
Cargo. Pandemic or not, cargo makes the world go round. In good times (remember those?) when airlines are plotting best routes to fly, the network planners reach out to the cargo departments to find out where factories, plants, large office structures, new assembly lines, and warehouses are going up, as business travel will be close behind in the year thereafter: jobs, people, service industries, and entertainment.
The cargo departments are the unsung players of the airline world. Not nearly as sexy, no Leonardo diCaprio movies about the cargo managers, no front tables at a general aviation conference, but what a life it is, so close to the pulse of the economy, of what makes the world go round.
Just this past week, everyone got a peek into the importance of the cargo world as we watched with fascination at the number of vessels that were backed up behind the Ever Given container ship, a ship as big as the Empire State Building, and heard the statistics the newscasters were sharing on cable and TV programs. I heard one channel exclaiming, ”there may be another toilet paper shortage! The barge carrying the pulp from Brazil up north to the plant to process it into paper, is stuck in the queue of some 400 ships!” Parents, glad to have a new distraction to the monotony of home schooling, were madly looking up maps to share a bit of geography with kids at home…sure to be a trivia question at your next party…just where is the Suez Canal?
Globalization has created such efficiencies, and such an interdependency around the world, that while we may now have learned how to be productive working alone from home during this past year, the cargo world thrives on massive, active supply chain logistics to move spare parts, foodstuffs, medical supplies and more from one production point to another and finally to a farther distribution depot. Trains, trucks, planes, ships, forklift drivers, warehousemen and women, maintenance, sales and marketing professionals, loadmasters, security personnel, customs workers, IT specialists, safety experts all working in concert with one another as any and all available capacities are identified and prepped to move the goods.
While business and leisure travel are at a standstill these days, the cargo world is scrambling to provide the service, to find solutions, to get goods where they need to go, to get PPE to the healthcare workers, to get vaccines to virtually everyone, and to beat the ticking clock to satisfy the ever-increasing appetite for home product delivery – fast.
Scheduled passenger flights usually carry baggage, but also cargo, in the bellies. A whopping 59% of the world’s air cargo was carried on passenger aircraft in 2019, while 41% moved on dedicated freighter airplanes.
With far fewer passenger flights operating, the cargo world has been getting creative. Dusting off old freighters that had been parked in the Mohave Desert, the final resting place of many an aircraft; creating preighters by taking out passenger seats from unused passenger aircraft and filling the compartment with cargo that can fit through the doors. Driving trade costs sky high due to the lack of overall capacity to meet the demand as capacity goes to the highest bidder. These are all expensive options, and getting more expensive as fuel prices rise. Industry experts predict it may be 2024 before we see the available air capacities back to levels that more aptly match demand. But there have been positive consequences as well, as infrastructure is quickly developed in traditionally less-used airports, providing new channels, new jobs, and new options to move freight.
Aviation consultants have weathered a great many storms over the years, and good ones have the benefit of gleaning/learning from the best through good times and bad, mergers and acquisitions, bankruptcies and restructuring, process improvement, downsizing, right-sizing, and change management.
We also see the light at the end of the proverbial tunnel. We see those times coming again now. We’re rebuilding, licking our wounds, getting back on our feet, and making plans. It may not be sexy, but so rewarding to be part of the big picture, part of what makes the world go around. Join us for the journey. Let us help you make plans, too.
Sr. Consultant – Cargo & Logistics