Rosy future for express supply chain

David L. Cunningham Jr., president, FedEx Express, Asia Pacific looks at the trends impacting the air cargo industry as a whole and in particular the fastest growing segment of the industry - the express sector.

Over the past 20 years, the air cargo industry as a whole, and the air express sector in particular, has helped to change the way the world does business – we have shrunk the globe and helped to internationalisesupply chains.

Today, business is moving faster than ever: Value is being created in services; products are getting lighter and smaller, and supply chains are growing longer and more complicated. All these trends favour continued growth in air express services.

Underpinning all of this is the need for speed. Companies simply can’t afford to wait weeks for components and finished goods. New products and technologies are constantly coming on to the market, and with customers who want the latest and best products, obsolescence rates are high.

The increasingly smaller size and lower weight of high-value products will continue to create demand for an air express supply chain. Since the widespread adoption of aircraft as cargo carriers, air freight traffic has grown at about twice the rate of global GDP.

According to IATA, for instance, the amount of international air freight traffic carried by its 33 member carriers grew by 2.7 per cent in 2007 to 37,446 million freight tonne kilometers. Since World War II, global trade has consistently grown faster than world GDP. More firms are part of global supply chains than ever before, and countries want to make sure that they have a link in the chain. The proliferation of free trade agreements and talks between ASEAN countries and their larger neighbors demonstrates a commitment to breaking down trade barriers.