Multi-modal threats and opportunities

With the rising performance of ocean carriers, proven rail links from China to Europe and a rapidly developing road network spreading across Southeast Asia, the potential for modal shift seems never greater than now. Chaired by Karmjit Singh, chairman of the Chartered Institute of Logistics and Transport (CILT) Singapore, speakers on this roundtable session agreed that supply chains were becoming more diversifi ed as modal options continue to evolve but this did not necessarily mean a threat to air cargo, but rather more opportunity to offer customers varied solutions. By Donald Urquhart.

Session 1 Round Table 1b Round Table 1

Crucial to any discussion of the future of air cargo is Asia, reminded Andrew Herdman, director general of the Association of Asia Pacific Airlines (AAPA) as he highlighted the significance of the region to the sector. In particular, he noted that a third of the cargo industry now touches China in one way or another.

“Th e future’s continued growth will be in Asia, it’s a huge market, so Asia is going to be at the forefront of those developments both in terms of the sourcing front, but also as a destination market where consumers are located, ” he said. Like the growth in the Asian air passenger sector which is being driven by outbound travel, meaning it’s not just a destination anymore, so too for the consumers of Asia.

This means, he went on to say, that when we talk about logistics and in particular, multimodal competition, it’s important to not only think of Asia as a factory that ships to North America and Europe. Asia is increasingly the source of consumers who want to buy consumer goods, IT gadgets and luxury goods.

“We have to think of growing numbers of consumers in Asia and a lot of the logistics investments are to serve their needs, revolutionising retailing, logistics, warehousing, and ground transport. ” Far more than simply manufacturing, it’s also about the development of markets. “So when you’re in China you’re struck by the spread of the retail malls – the logistics behind that is the untold story of logistics development in Asia, ” Herdman said.