FEDERAL AVIATION ADMINISTRATION Annual Forecast Conference Washington, D.C. March 18, 2005
AIR CARGO DEMAND: An Overview Stephen A. Alterman President Cargo Airline Association Washington, D.C.
CARGO AIRLINE ASSOCIATION AIR CARRIER MEMBERSHIP <ul><li>Board of Directors </li></ul><ul><li>ABX Air, Inc. </li></ul><ul>...
AIR CARGO OVERVIEW <ul><li>Air Cargo Industry Segments </li></ul><ul><li>Bellies of Passenger Aircraft </li></ul><ul><li>A...
DEMAND DRIVERS <ul><li>Time Definite Service (Reliability) </li></ul><ul><li>Speed </li></ul><ul><li>Traceability </li></u...
DEMAND LIMITATIONS <ul><li>Uncertain Economic Picture </li></ul><ul><li>Security Concerns </li></ul><ul><li>Escalating Fue...
HIGH VALUE COMMODITIES ARE TRADITIONALLY TRANSPORTED BY AIR <ul><li>High-tech electronics </li></ul><ul><li>Human organs <...
WHAT THIS MEANS <ul><li>While only approximately 2% of all freight moves by air, 45-50% of the  value  of freight transpor...
WHO CARRIES THIS FREIGHT? <ul><li>DOMESTIC TRAFFIC </li></ul><ul><li>2004 </li></ul><ul><li>Passenger Carriers – 24.1% </l...
WHO CARRIES THIS FREIGHT? <ul><li>International Traffic </li></ul><ul><li>2004 </li></ul><ul><li>Passenger Carriers – 40.3...
DOMESTIC v. INTERNATIONAL <ul><li>Demand increasing more dramatically in international markets – particularly Asia </li></...
DOMESTIC v. INTERNATIONAL <ul><li>Relatively smaller domestic growth </li></ul><ul><li>Less than robust domestic economy <...
CONCLUSION <ul><li>Demand for air cargo services continues to grow – especially in international markets </li></ul><ul><li...
Upcoming SlideShare
Loading in …5
×

Air cargo demand an overview - steve alterman

983 views

Published on

0 Comments
0 Likes
Statistics
Notes
  • Be the first to comment

  • Be the first to like this

No Downloads
Views
Total views
983
On SlideShare
0
From Embeds
0
Number of Embeds
2
Actions
Shares
0
Downloads
19
Comments
0
Likes
0
Embeds 0
No embeds

No notes for slide

Air cargo demand an overview - steve alterman

  1. 1. FEDERAL AVIATION ADMINISTRATION Annual Forecast Conference Washington, D.C. March 18, 2005
  2. 2. AIR CARGO DEMAND: An Overview Stephen A. Alterman President Cargo Airline Association Washington, D.C.
  3. 3. CARGO AIRLINE ASSOCIATION AIR CARRIER MEMBERSHIP <ul><li>Board of Directors </li></ul><ul><li>ABX Air, Inc. </li></ul><ul><li>Atlas Air </li></ul><ul><li>Federal Express </li></ul><ul><li>UPS </li></ul><ul><li>Members </li></ul><ul><li>Air Transport International </li></ul><ul><li>Capital Cargo International </li></ul><ul><li>CNF, Inc. </li></ul><ul><li>DHL Express </li></ul><ul><li>First Air </li></ul><ul><li>Gemini </li></ul><ul><li>Kalitta Air </li></ul><ul><li>Kitty Hawk </li></ul><ul><li>USA Jet </li></ul>
  4. 4. AIR CARGO OVERVIEW <ul><li>Air Cargo Industry Segments </li></ul><ul><li>Bellies of Passenger Aircraft </li></ul><ul><li>Air Freight Forwarders </li></ul><ul><li>All-Cargo Aircraft </li></ul><ul><li>Regional Aircraft </li></ul><ul><li>All segments provide the services necessary to satisfy shipper demand. </li></ul>
  5. 5. DEMAND DRIVERS <ul><li>Time Definite Service (Reliability) </li></ul><ul><li>Speed </li></ul><ul><li>Traceability </li></ul><ul><li>Probably NOT Price </li></ul>
  6. 6. DEMAND LIMITATIONS <ul><li>Uncertain Economic Picture </li></ul><ul><li>Security Concerns </li></ul><ul><li>Escalating Fuel Prices </li></ul><ul><li>Necessary Fuel Surcharges </li></ul><ul><li>Price Competition from Other Modes </li></ul>
  7. 7. HIGH VALUE COMMODITIES ARE TRADITIONALLY TRANSPORTED BY AIR <ul><li>High-tech electronics </li></ul><ul><li>Human organs </li></ul><ul><li>Important documents </li></ul>
  8. 8. WHAT THIS MEANS <ul><li>While only approximately 2% of all freight moves by air, 45-50% of the value of freight transported qualifies as air freight </li></ul>
  9. 9. WHO CARRIES THIS FREIGHT? <ul><li>DOMESTIC TRAFFIC </li></ul><ul><li>2004 </li></ul><ul><li>Passenger Carriers – 24.1% </li></ul><ul><li>All-Cargo Carriers – 75.9% </li></ul><ul><li>Forecast Period (12 Years) </li></ul><ul><li>Passenger Carriers – 20.0% </li></ul><ul><li>All-Cargo Carriers – 80.0% </li></ul><ul><li>Source: 2005 FAA Forecast, March 2005 </li></ul>
  10. 10. WHO CARRIES THIS FREIGHT? <ul><li>International Traffic </li></ul><ul><li>2004 </li></ul><ul><li>Passenger Carriers – 40.3% </li></ul><ul><li>All-Cargo Carriers – 59.7% </li></ul><ul><li>Forecast Period (12 Years) </li></ul><ul><li>Passenger Carriers – 36.4% </li></ul><ul><li>All-Cargo Carriers – 63.6% </li></ul><ul><li>Source: 2005 FAA Forecast, March 2005 </li></ul>
  11. 11. DOMESTIC v. INTERNATIONAL <ul><li>Demand increasing more dramatically in international markets – particularly Asia </li></ul><ul><li>For 2004, FAA estimates approximately 45% more growth internationally (5.5% annually internationally v. 3.8% domestically). FAA March 2005 Forecast </li></ul><ul><li>91% more annualized international growth than domestic for next twelve years – 2005-2015 (6.3% annually v. 3.3 %). FAA March 2005 Forecast </li></ul>
  12. 12. DOMESTIC v. INTERNATIONAL <ul><li>Relatively smaller domestic growth </li></ul><ul><li>Less than robust domestic economy </li></ul><ul><li>Mature industry </li></ul><ul><li>Greater international growth </li></ul><ul><li>Opening of new markets </li></ul><ul><li>Expanding Asian economy </li></ul>
  13. 13. CONCLUSION <ul><li>Demand for air cargo services continues to grow – especially in international markets </li></ul><ul><li>Industry members are well positioned to meet these growing demands </li></ul><ul><li>Governments must move to further open markets to allow carriers to meet the needs of the world’s shippers </li></ul>

×