Planning for a comeback

A trip to any United States airport today is convincing evidence that economic recovery is underway, and people are eager to travel again. The increase in passenger volume means that airlines are able to fly previously parked planes, which has restored both passenger seat availability and urgently needed belly cargo capacity. This resurgence promises to benefit shippers and freight forwarders in the long run, but governments worldwide need to increase their support as our industry faces significant challenges ahead. [caption id="attachment_93852" align="alignright" width="300"] Brandon Fried, Executive Director of the U.S. Airforwarders Association[/caption] With vaccination rates in developed countries expected to exceed 50% of the population by Q3 2021, consumers are anxious to travel and spend the savings they have accumulated during the lockdown. Additionally, a recent report from IATA demonstrates that the economy is strong and can fuel growth for air travel, with February 2021 production levels at 2% above those experienced in the same month of 2019. The travel and tourism sectors are significant contributors to GDP, and the forecasted surge in these markets should be a call to governments to prepare. Now is the time for governments to facilitate safe restart policies that allow for restriction-free travel for vaccinated people and easy testing for those unable to be vaccinated. As domestic and international airfreight capacity comes online, the cargo community is facing the same significant obstacles that existed before the pandemic. However, time has only caused these challenges to increase and now they must be addressed. Otherwise, they will continue to permeate throughout the industry and threaten all modes of freight transportation, even those away from the airport. Congestion at maritime ports continues to increase at unsurpassed levels, with detention and demurrage fees continuing their acceleration. This issue has brought complaints from U.S. shippers and freight forwarders about the cost of charges, which sparked a recent study by the Federal Maritime Commission to review the matter. Unfortunately, not much has changed at this point, and many are calling for the U.S. government to amend the Shipping Act to allow for better FMC enforcement of detention and demurrage rules, as well as other unreasonable acts. President Joe Biden's proposed infrastructure plan includes about $500 billion in transportation-related investment. Much of this money, if approved, will be needed to improve the physical infrastructure at our maritime ports, railways, road networks and inland ports to address and improve our national maritime capacity. However, maritime congestion isn’t an insular issue. President Biden's infrastructure plan only includes about $25 billion to improve airports. While this sounds like a large sum, additional funding will be necessary to make impactful change, and it must be designated explicitly for urgently needed cargo area improvements at major airfields. Most of the gateway airports throughout the U.S. have not received any physical facility investment for over forty years. As a result, the buildings are unequipped to handle the current level of cargo. This lack of terminal capacity leaves forwarders to manage the added expense caused by excessive wait times and congestion-related shipment delays. Another developing threat to the industry is cybercrime. Cyberattacks against the freight transportation industry are increasing rapidly, and ransomware payments by victims quadrupled in 2020 from 2019. While defensive solutions such as antivirus software, secure data backups, and dual-factor authentication are deterrents, these measures are insufficient to meet the increased cybersecurity needs. To succeed in a fight against cybercriminals, governments must elevate the issue and join the battle. A practical place to start may be encouraging our industry and governments to bring innovative ideas to the table, such as monitoring cryptocurrency exchanges for illegal transactions. Environmental concerns are also growing, and freight forwarders are increasingly becoming aware of sustainability needs and beginning to tackle the issue. Many now designate specific individuals and even whole departments for addressing company initiatives to cut carbon emissions. These plans include facility energy management and selecting trucking, air and ocean carriers committed to demonstrating sustainability goals consistent with those of the forwarder and its client base. Aviation continues its commitment to cutting its carbon emissions to half of 2005 levels by 2050. The industry continues to make significant efficiency gains, but governments will need to assist as well. This assistance can include facilitating low-carbon energy through sustainable fuels that have electric and hydrogen power. Necessary infrastructure changes and redevelopment at airports and within air traffic management systems can also help our aviation interests to operate with maximum efficiency and minimum emissions. Since the start of the COVID-19 pandemic more than a year ago, the freight transportation industry changed how it relates to and navigates the world. While most strive for a sense of normalcy like the days before the pandemic, we have also realized that some changes, such as remote working, may be here to stay. As the freight industry helps economies emerge and recover, effectively dealing with these, and other yet identified challenges, promises to make us more efficient and better prepared for a brighter future.

Planning for a comeback

Cargo Chat: Dimerco’s Jeffrey Shih on peak season expectations

Editor’s Note: Good things ahead

Editor’s Note: Good things ahead

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