The document provides an overview of the global air cargo market, including: 1) It describes the three major segments of the air cargo industry - air freight, express, and mail - and notes that the top 30 airlines transport 75% of the world's air freight. 2) It shows that the busiest air freight airports are concentrated in Asia, North America, and Europe, with the top three being Hong Kong, Memphis, and Frankfurt. 3) It outlines projections that world air cargo traffic will triple over the next 20 years and the freighter fleet is expected to double, led by large freighters.

1. Introduction to the Global Air Cargo Market

2. Agenda Air Cargo Industry Overview U.S. Domestic Air Cargo Market International Air Cargo Market Industry Outlook

3. Air Cargo Industry Overview

4. Air Cargo Industry Overview Services Providers Express Air Freight Mail Air Cargo Industry has three major segments – Air Freight, Express and Mail.

5. Represents 75% of world traffic 130,776 FTKs Top 30 Airlines Transport 75% of the World’s Air Freight Systemwide scheduled C – Passenger and freight operator F – All-freight operator I – Integrated services operator Source: IATA and direct reports

6. Busiest Air Freight Airports are concentrated in Europe, Asia and North America Asia ( ) – World Ranking North America 1. Hong Kong (2) 3,402,247 2. Tokyo-Narita (4) 2,239,930 3. Seoul-Incheon (5) 2,120,542 4. Shanghai (8) 1,842,474 5. Singapore (9) 1,833,721 6. Taipei (13) 1,692,447 7. Dubai (18) 1,281,050 8. Bangkok (19) 1,130,298 9. Osaka (22) 840,235 10. Beijing (23) 782,066 11. Guangzhou (25) 726,356 12. Tokyo-Haneda (27) 672,464 13. Kuala Lumpur (30) 653,654 1. Memphis (1) 3,592,570 2. Anchorage (3) 2,553,937 3. Los Angeles (7) 1,858,277 4. Louisville (10) 1,813,859 5. Miami (12) 1,718,076 6. New York –JFK (14) 1,585,253 7. Chicago-O’Hare (16) 1,443,348 8. Indianapolis (20) 979,042 9. Newark (21) 868,265 10. Atlanta (26) 725,446 11. Oakland (28) 667,806 Europe 1. Frankfurt (6) 1,864,398 2. Paris-CDG (11) 1,767,260 3. Amsterdam (15) 1,449,855 4. Heathrow (17) 1,305,976 5. Luxembourg (24) 742,342 6. Brussels (29) 654,316 Source: Airports Council Int. 2005

7. The Freighter Fleet Is Grouped Into Three Payload Size Categories Commercial Jet Freighter Fleet Summary (1559 Total Units) Standard-body (less than 45 tonnes) Medium widebody (40 to 75 tonnes) Large widebody (more than 75 tonnes) 626 Units 440 Units 493 Units DC-10-30/40 MD-11 747 777 A340 767 A300 A310 A330 L-1011 DC-10-10 A350 787 BAe-146 707-320C DC-9DC-8 737 757-200 727 MD-80/-90 A320 * Excludes parked aircrafts. Source: ACMG, 2009

8. U.S. Domestic Air Cargo Market

10. FedEx and UPS together controlled 77% of the market in 2008. FedEx and UPS gained more market shares after DHL exit U.S. Domestic market in 2009.Source: Air Cargo Management Group, 2009

12. U.S. Domestic Express Shipment Growth The 2008 shipment total is up only 19% from 1994. That increase reflects 6% growth per year between 1994-2002. The market size changed little from 2002 to 2007, before falling 14% in 2008. Source: ACMG estimates, 2009

13. Emerging Trend in the U.S. Domestic Air Cargo Industry The integrated express carriers FedEx and UPS continue to dominate the U.S. market. The U.S. domestic express market underwent dramatic changes near the end of 2008 in response to DHL’s exit from U.S. domestic market. Both FedEx and UPS gained customers left by DHL. The U.S. Postal Service continues to be challenged by the falling demand for its services, including Express Mail and Priority Mail. A major change in postal regulations recently gives the USPS more flexibility to compete with private sector companies. The USPS alliance with FedEx that began in August 2001 remains in effect. Security issues continue to be the principal regulatory concern facing the industry. The main emphasis today for combination carriers is to achieve 100% screening of belly cargo by August, 2010. Source: ACMG estimates, 2009

14. International Air Cargo Market

15. Int’l Air Cargo TrendThe Int’l Air Cargo traffic had sharp decline during the recession Year 2009 ended to be the most difficult ever for the global air freight industry; Air freight showed a decline of nearly 15% (in FTK) compared to 2008. About 15% of the global fleet of freighter aircraft was taken out of service during the 2009 downturn; There are encouraging signs entering 2010 that a recovery is taking place, as traffic levels have rebounded from a low point in the first quarter of 2009. ACMG expects that air cargo traffic will grow 7%-10% in 2010, and there is a good chance that it will recover to the pre-recession peak by 2012. Source: IATA Monthly Traffic Report.

17. Despite gains by the express companies, airlines and forwarders retain control of 65.2% of the revenue and 88.6% of the tonnage of air cargo handled in the international market. Source: Air Cargo Management Group, 2009

20. FedEx, UPS, DHL and TNT are the four major service providers in the Int’l Air Express market.Source: ACMG estimates, 2009

21. International Air Express Shipment Growth The Int’l Air Express volume growth was steady and substantial from 1992 through 2007 (10% CAGR), followed by a slowdown in 2008 and significant 7% decline in 2009. Source: ACMG estimates, 2009

22. Emerging Trend in the Int’l Air Cargo Industry Express services are expected to continue growing faster than traditional air freight, which will result in a larger market share for Express in the future. Low cost airlines are taking more interest in air freight, a business opportunity they have largely ignored in the past. Airlines continue to establish broad alliances to extend their market reach and create global coverage. More open skies aviation pacts are signed and benefit the air cargo operation. U.S. leads the way in aviation treaty liberalization, with more than 90 open skies pacts. The most significant development on the horizon is Phase Two of the EU-U.S. open skies agreement. Source: ACMG estimates, 2009

23. Industry Outlook

24. Air Cargo Traffic Growth is Strongly Influenced by GDP Growth RTKs annual growth, percentage GDP annual growth, percentage Historically Air Cargo has Grown 2 Times Faster then GDP

25. Forces and Constraints for Air Cargo Growth Although economic activity is the primary influence on world air cargo development, other factors must be considered. Source: Boeing World Air Cargo Forecast 2008-2009 edition

26. World air cargo traffic is projected to triple over the next 20 years Source: Boeing World Air Cargo Forecast 2008-2009 edition

27. Regional Air Cargo Market Forecast Source: Boeing World Air Cargo Forecast 2008-2009 edition

29. Worldwide freighter fleet is projected to double in the next 20 years, led by large freighters. Source: Boeing World Air Cargo Forecast 2008-2009 edition