Air cargo service is a method of transporting goods by air using specialized cargo aircraft or the cargo space of passenger planes, providing efficient and fast delivery of goods across the world. The demand for the global market is expected to significantly increase in the coming years and can be attributed to several factors such as the growing e-commerce sector, rising globalization, increasing demand for temperature-sensitive products, perishable and pharmaceutical goods, expanding manufacturing industries, and advancements in cold chain logistics.
The rapid growth of e-commerce has become a significant driving force in the market. According to a March 2021 report by International Air Transport Association (IATA), global e-commerce retail sales surged by 27.6% in the year, amounting to USD 4.280 trillion. The exponential growth of online retail has spurred the demand for efficient and expedited shipping services, specifically in the air cargo sector. The COVID-19 pandemic has further accelerated the growth of e-commerce, with consumers increasingly turning to online shopping during lockdowns and social distancing measures. Significantly, e-commerce has emerged as the fastest-growing segment in the cargo industry. As highlighted in an October 2020 article by International Air Transport Association (IATA), DHL ecommerce Solutions witnessed a significant surge in cross-border volumes, with a remarkable increase of over 28% observed from February to March 2020, amid the pandemic.
The COVID-19 pandemic has led to an increased demand for pharmaceutical products, including medications, medical equipment, personal protective equipment (PPE) kits, and vaccines, which are often temperature-sensitive and require efficient transportation. This surge in demand has resulted in a boost in the market, as it provides fast and reliable transportation options to meet the urgent needs of the healthcare industry during the pandemic.
Moreover, the market is anticipated to grow significantly driven by the adoption of cutting-edge technologies, including blockchain, for cargo tracking and tracing. Key players in the industry have begun incorporating these technologies to optimize service efficiency. For instance, in May 2020, Air Asia, a Malaysian airline, introduced a blockchain-based air cargo network to simplify the booking process for cargo space on its own aircraft and other airlines, making it more convenient for customers. This highlights the growing recognition of blockchain's potential to revolutionize air cargo management and drive market growth.
Furthermore, the Indian air cargo market is projected to experience significant growth in the coming years. As per a press release by Air Cargo Forum India in May 2022, airlines have witnessed a remarkable 520% increase in cargo revenue over the past two years. In addition, the government's support in strengthening the market in India is expected to have a positive impact. For instance, the Ministry of Civil Aviation has planned to invest around USD 11 billion in setting up new airports and expanding existing ones, with private and government investment. This expansion of air infrastructure can create opportunities in various sectors, such as agriculture to aviation (A2A) linkages, enabling easy transportation of Indian-origin products like agricultural and pharmaceutical goods to different countries. These factors may contribute to the growth of the market in Asia-Pacific region.
Key players operating in the market are FedEx, Qatar Airways, All Nippon Airways Co Ltd., Etihad Airways, Singapore Airlines, Japan Airlines, Cargolux, Korean Air, The Emirates Group, DHL International GmBH, United Parcel Service of America Inc, Emirate Sky Cargo, Zela Aviation and Lufthansa Cargo AG among others.
The air cargo market is segmented on the basis of type, service, destination, end-use, and region.
Pharmaceutical & Healthcare
Food & Beverages
Middle East and Africa
All Nippon Airways Co Ltd.
The Emirates Group
DHL International GmBH
United Parcel Service Of America Inc
Emirate Sky Cargo
Zela Aviation The Air Charter Company
Lufthansa Cargo AG
Cathay Pacific Airways Ltd.
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