Chapter 28: Air-Freight Logistics

The air transport industry has gradually increased its share of global passenger and freight traffic, largely at the expense of rail transport (Button et al., 1998). This trend has accelerated in the last 30 years. For the past decade, air-freight traffic growth has outpaced air passenger traffic growth by 1-2% points each year. The air-freight sector has been transformed since the late-1970s. Prior to deregulation of air cargo in the U.S.A. in 1977, the industry offered limited products, with heavy reliance on several intermediaries and a significant dependence on air passenger operations. The industry can now be characterized as a sophisticated, innovative sector relying heavily on new electronic technologies and offering a wide range of transport and logistical products through dedicated specialist cargo operators. With increasing emphasis on the globalization of trade and economic activity, air-freight growth is expected to continue to outpace air passenger traffic growth and be greatest in Asian markets (i.e., intra-Asia, North America-Asia, Europe-Asia, Australasia), despite the recent economic crises in the region. The correlation between world gross domestic product (GDP) and world air-freight traffic forms the basis for traffic forecasts. Because of the cyclical nature of GDP growth, air-freight traffic growth is also subject to cyclical effects.