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AI-Enabled Solutions Are Fueling the Growth of the Global Air Cargo And Freight Logistics Market

AI-Enabled Solutions Are Fueling the Growth of the Global Air Cargo And Freight Logistics Market

The air cargo and freight logistics market is estimated to be valued at US$ 142.77 Bn in 2023 and is expected to exhibit a CAGR of 5.9% over the forecast period 2023-2030, as highlighted in a new report published by Coherent Market Insights.

Market Overview:

Air cargo consists of products that are transported by commercial aircraft operators. It covers a wide range of commodities including electronics, pharmaceuticals, perishables, and other high value commodities. Efficient transportation of goods has become crucial due to increasing globalization and trade. Air freight logistics helps meet just-in-time manufacturing and delivery requirements.

Market Dynamics:

Rapid urbanization is driving the need for efficient transportation of goods across regions. The urban population growth has increased demand for a variety of goods ranging from electronics to perishable foods. This requires an integrated logistics network for timely delivery. Moreover, increasing exports and imports between countries have augmented the volume of air freight. Asia Pacific region accounts for the largest share in the global air cargo trade due to strong manufacturing sector in countries such as China and India. Shortened product life cycles have necessitated fast movement of goods to market. This is positively impacting the air cargo and freight logistics market. However, volatility in crude oil prices remains a challenging factor as it increases operational costs for air freight operators. Additionally, increasing preference for ocean shipping over air transport due to relatively lower costs may restraint market growth.

SWOT Analysis

Strength: The air cargo and freight logistics market has a strong global infrastructure in place with hubs in major regions. Established players have decades of expertise and reliable operations. Digitalization is helping improve efficiency of cargo movements and tracking.

Weakness: Market is heavily dependent on global trade and economic growth. Any slowdown impacts demand significantly. Fuel costs are major expenses and volatility affects profits. Congestion at airports can lead to delays.

Opportunity: Emerging markets in Asia Pacific and Latin America are expected to drive higher volumes in the coming years. Adoption of e-commerce is expanding the scope for integrating freight with passenger airlines. Adoption of autonomous vehicles and drones can optimize last mile delivery.

Threats: Outbreaks of diseases can severely restrict international travel and trade flows impacting the market. Significant investments are required to adopt new technologies. Protectionist policies by governments pose a challenge. Competition is increasing from sea and road freight operators.

Key Takeaways

The Global Air Cargo and Freight Logistics Market Size is expected to witness high growth, exhibiting a CAGR of 5.9% over the forecast period, due to increasing cross-border trade and outsourcing of manufacturing activities. Asia Pacific region dominated the global market in 2023 with a share of over 35%, driven by vibrant economies such as China and India.

Regional analysis: The Asia Pacific region continues to be the fastest growing as well as the dominant region, accounting for more than 35% share of the global air cargo and freight logistics market in 2023. Presence of manufacturing powerhouses such as China, robust industrial and export activities in other ASEAN countries, and rapid e-commerce adoption are fueling growth. North America is another major regional market led by the large economy of the US.

Key players: Key players operating in the air cargo and freight logistics market are FedEx (Federal Express) Corporation, United Parcel Service Inc., The Emirates Group, Japan Airlines Co. Ltd and All Nippon Airways Co. Ltd (ANA). These companies have substantial assets including fleet of aircraft and worldwide networks to move large volumes of cargo efficiently.

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