Air Freight Market Size, Share, Growth, and Industry Analysis, By Type (Forwarding & Mail), By Application (Domestic & International) and Regional Forecast to 2032

Updated On: 09 September 2024

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AIR FREIGHT MARKET REPORT OVERVIEW

The global Air Freight Market Size was USD 757.3 million in 2023 and the market is projected to touch USD 953.9 million by 2032, exhibiting a CAGR of 2.3% during the forecast period.

The air freight market defines the movement of goods by air transport, which has a relatively short transit time, providing services on both international and domestic levels. Air freight again holds an imperative role as it addresses the time-sensitive and valuable goods that help solve supply chain requirements. This encompasses the forwarding services as it involves the planning and arranging of the shipment, and the mailing services major in the delivery of parcels and documents. The market is fueled by a rising trend of e-commerce, globalization, and the necessity to restock within a shorter time in different industries.

COVID-19 Impact: Market Growth Restrained During Pandemic Due to decreased cargo space,  lockdowns and border closures

The global COVID-19 pandemic has been unprecedented and staggering, with the market experiencing lower-than-anticipated demand across all regions compared to pre-pandemic levels. The sudden market growth reflected by the rise in CAGR is attributable to market’s growth and demand returning to pre-pandemic levels.

The COVID-19 outbreak has heavily impacted the air freight market; the decrease in passenger flights sharply decreased the availability of global cargo space. This was compounded by lockdowns and the closure of borders, which distorted operations, hence delaying and pushing up the cost of implementation. Also, voluntary measures such as shutdowns and reduced purchasing from end-users due to the pandemic period affected the shipment numbers and, consequently, the market conditions.

LATEST TRENDS

"Market growth is driven by demand and sustainability"

Currently, the belly cargo in the passenger planes is limited, and the air freight market is gradually shifting to more dedicated freighter aircraft. E-trade expansion will cause more significant expectations for faster and more efficient transportation modes to deal with this necessity, making organizations enter into more specialized air cargo services. Also, there is the issue of sustainability coming up clearly as more of the airline is searching for the most efficient planes and setting up programs of carbon neutrality. The sustainability concept in the overall logistics chain has been found to be on the rise, especially because of the concern that many firms have for the environment.

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SEGMENTATION

By Type

Based on type the market can be categorized into Forwarding & Mail.

Forwarding: Basically, forwarding in the air freight market aims at the organization and control of the cargo through the movement channels from the shipping point to the receiving station. This encompasses organizing for the services of moving the products, clearing them through customs, and making certain they get to the intended destination on time. Globalization and advancement in technology have enhanced business, especially through exports and imports, resulting in the need for good forwarding.

Mail: According to the scope of business, air freight market mail services specifically center their operations around the transportation of letters, packages, and other forms of documents through the air. This segment enjoys high priority and speed in servicing the domestic as well as international postal demands. The increase in the use of the internet to transact has increased the use of airmail as a means of communication.

By Application

Based on application the market can be categorized into Domestic & International.

Domestic: Domestic air freight is the movement of cargo within a nation’s borders that is useful for local and regional supply chains. This segment helps in making deliveries across cities and states in an efficient manner, hence improving the logistics. Topics such as e-commerce and the implementation of just-in-time inventory have made domestic air freight popular among businesses.

International: International air freight is the carriage of goods across borders, and it plays a significant role in carrying out business across the world. It entails issues such as customs as well as other global affairs. It is evident that an upsurge in supply chains as well as trade liberalization has enhanced the development of international air freight.

DRIVING FACTORS

"Technological advancements boost Market growth due to e-commerce"

The technological advancement, particularly e-commerce, has played a vital role in Air Freight Market Growth. Increased demand for speed and a shorter delivery time frame has made the retailers in question shift to air freight as the most effective means of transportation. This trend is even more pronounced in cross-border contexts because the ability to process the flow as fast as possible provides a competitive edge.

"Market growth is driven by globalization and demand for fast means of transport"

Companies continue to improve their globalization of their supply chains, which in turn has resulted in greater use of air freight for moving valuable and perishable goods. Air freight is faster than other modes of transport, hence particularly suitable for goods that are time-sensitive, such as electronics, pharmaceuticals, and automobiles. Such a demand for speed and efficiency in the market is driving the market ahead.

RESTRAINING FACTOR

"Market growth is constrained by high operational costs and price sensitivity"

A factor that has limited the air freight market is the high operation costs; these include fuel costs, personnel costs, and airport charges. As the writing has illustrated, these costs can inflate the cost of using air freight relative to other forms of transport; hence, it remains suitable mainly for products with high value or those that need to be transported within a limited amount of time. This price sensitivity may help to dissuade some firms from using air freight, particularly when the economic conditions are adverse.

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AIR FREIGHT MARKET REGIONAL INSIGHTS

The market is primarily segregated into Europe, Latin America, Asia Pacific, North America, and Middle East & Africa.

"Market growth is driven by North America's transport facilities and e-commerce"

North America holds the largest Air Freight Market Share due to superior transport facilities and the high level of export/import in this region. Supermarkets from the U.S. and Canadian markets offer essential support to a large quantity of air cargo traffic arising from speedy e-commerce business and the call for fresh express delivery services. Furthermore, technological developments concerning the supply chain in the region increase reliability and effectiveness in air freight.

KEY INDUSTRY PLAYERS

"Market growth is fueled by tech investments and expanding services"

The major market players in the air freight market are continuously expanding their range of services and investing in technologies such as AI to optimize routes, boost the effectiveness of tracking cargo, and optimize the supply chain. They are also increasing their international partnerships while developing alliances and providing services to accommodate different ranges and needs of industries such as e-commerce and pharmaceuticals to enhance market profitability and productivity.

List of Market Players Profiled

• FedEx (Federal Express) Corporation (U.S.)
• United Parcel Service Inc. (U.S.)
• The Emirates Group (U.A.E.)
• Cathay Pacific Airways Limited (China)
• Cargolux Airlines International SA (Luxembourg)

INDUSTRIAL DEVELOPMENT

May, 2023: FedEx announced a significant investment of $2 billion to expand its global air network. This development underscores the company's commitment to enhancing service reliability, capacity, and speed, aligning with the growing demand for efficient air freight solutions.

REPORT COVERAGE

This report is based on historical analysis and forecast calculation that aims to help readers get a comprehensive understanding of the global Air Freight Market from multiple angles, which also provides sufficient support to readers’ strategy and decision-making. Also, this study comprises a comprehensive analysis of SWOT and provides insights for future developments within the market. It examines varied factors that contribute to the growth of the market by discovering the dynamic categories and potential areas of innovation whose applications may influence its trajectory in the upcoming years. This analysis encompasses both recent trends and historical turning points into consideration, providing a holistic understanding of the market’s competitors and identifying capable areas for growth.

This research report examines the segmentation of the market by using both quantitative and qualitative methods to provide a thorough analysis that also evaluates the influence of strategic and financial perspectives on the market. Additionally, the report's regional assessments consider the dominant supply and demand forces that impact market growth. The competitive landscape is detailed meticulously, including shares of significant market competitors. The report incorporates unconventional research techniques, methodologies and key strategies tailored for the anticipated frame of time. Overall, it offers valuable and comprehensive insights into the market dynamics professionally and understandably.