The role of dedicated freighters in the airline industry is still relevant and growing, even as the air cargo sector faces some headwind and overcapacity.

According to IATA chief economist Bryan Pence, the freight traffic, measured in FTKs has not grown over the last 12 months, factoring seasonal adjustments.

At the IATA World Cargo Symposium in Singapore, industry experts highlighted that the strong demand for passenger aircraft means more underbelly cargo space is injected into the market, often outpacing freight demand.

Boeing regional director Tom Crabtree said more than half of air cargo is still carried by freighters, and the world will need 980 new, and 1,670 converted cargo aircraft over the next 20 years. Asia, in particular, will lead the top three air cargo routes; Asia-North America and Asia-Europe will both see RTK growth of 4.7% annually and within Asia will see growth of 5.8% annually. The world’s average cargo growth is at 4.2%.

Crabtree added that passenger belly cargo sometimes does not serve key cargo routes and—within major hubs like Hong Kong, Singapore and Tokyo—passenger aircraft capacity does not meet demand. In addition, the commercial airline schedule sometimes does not meet shippers’ needs, which is usually Thursdays/Fridays to take advantage of the factory downtimes over the weekend. More importantly, belly cargo cannot serve dangerous goods and project cargo, which usually brings some of the higher yields. 

Cargo Fact Consulting managing director Frederic Horst sees the ratio between cargo carried by underbelly versus freighter would shift from an equal 50:50 to 60:40 over 20 years. He added that the narrowbody and medium widebody fleet would grow by 60%-80%, mainly conversions, driven by the strong e-commerce express networks.

“The current feedstock of the Boeing 737-700/800 for conversion is too high and expensive,” Horst said. “Even in the long run, the potential for the 737-300/400 conversions and 757 is still there.”

Chen Chuanren, chuanren@purplelightvisuals.com