Air freight is a key enabler of cross border trade which becomes especially critical for express deliveries, long-distance and efficient transportation of sensitive and critical goods.
It has suffered from decades of no growth but is now back on track with some positive forces supporting its growth: strong export orders, a booming e-commerce relying on express delivery, and an expected high-value specialized cargo.
Digitization is seen as a key lever for the development of new innovative services and solutions which will drive efficiency in the air cargo ecosystem and deliver incremental value to the end customers.
However, while road freight R&D works on autonomous cars development and rail freight has already triggered IoT [1] initiatives to develop use cases around predictive maintenance, geolocation, air freight appears to embrace more slowly digitization. While some major initiatives have been launched such as e-freight and digital cargo, digitization remains marginal.
This insight is based on a panorama of initiatives launched in air cargo by major airline companies and traditional air transportation institutions including IATA. It will therefore mainly highlight initiatives from the transportation side of the value chain.
Overview of the current ecosystem
The air cargo ecosystem is complex with many stakeholders involved along the value chain: shippers, carriers, customs, freight forwarders, integrators, airlines and end customer to only name a few.
Two models are currently ruling the air cargo industry: the freight forwarding model and the integrated freight model [2]. The shipper will whether commission a freight forwarder that will sub-contract all the stages of the end-to-end journey or an integrator that will internalize all these stages by owning the assets to do so.
The integrator will then arrange the storage and the collection of the cargo, the surface transport to the airport, the changeover by custom borders, the air leg and the delivery to the final destination.
For the freight forwarding model, each stage of the journey will be under the responsibility of the sub-contracted actor. For the shipment transportation to the airport and then to the foreign destination, a hauler (in charge of the ground transportation), a ground-handling agent and an airline are involved. An insurance or customs broker can also participate in order to provide an expertise on specific subjects