TIACA: Low inventories could aid air cargo

TIACA: Low inventories could aid air cargo    International Air Cargo Association Chairman Ulrich Ogiermann said the air cargo industry's recovery could well be aided by shippers keeping lower stock levels and returning to a 'just-in-time' model.
   'Recent studies prove the reduction in logistics costs are outweighed by the increased cost of local production, where infrastructure and employment investment in greater,' Ogiermann said. 'I do not expect this to have the negative impact on air cargo others have predicted.
   “One of the few positives to come from the recession is that companies everywhere are now ready to consider and discuss any changes within their business if it benefits their bottom line. Previously there were too many taboos that left no room to maneuver. These have disappeared. There are no more ‘kingdoms’ in companies that are protected at all costs. This is a positive shift in management because companies will leave anything behind that does not add value.”

Ogiermann

   Ogiermann said the air cargo industry’s first goal in 2010 is to “stop the bleeding from the wounds incurred in 2009.' That means several months of growth before airlines can truly believe the economic recovery is underway. He said it would be 2011 before the industry sees a sustainable improvement.
   “It will clearly take a lot of time for the entire air cargo industry to recover properly and it has to decide what it is going to do to make air freight more attractive to customers,' he said. 'I expect to see more volatility over the next 12 months because there are still many unknown factors and bubbles waiting to burst at any moment. The banking sector remains exposed while the fragile real estate market and level of credit card borrowing could once again tip the balance for the already substantially challenged financial world. Many national economies will still need international support.
   “Nonetheless, air cargo companies will be leaner, more cost efficient and very much wiser as a result of the unprecedented economic collapse we have experienced. The difficult decisions forced on companies will mean that they will at least be in a stronger position as business levels start to recover.”