Air cargo needs to meet triple challenge – Sullivan

The Global Head of Air Cargo at the International Air Transport Association (IATA) has said the aviation sector has to  meet the rising challenges of sustainability and digitalisation.

Speaking at the World Cargo Symposium, in Istanbul Brendan Sullivan, (pic) said the world was changing but the role of the air cargo industry was still vital as the global economic fought to recover.

“We are a different industry than the one that entered the pandemic,” he said. “Revenues are greater than they were pre-pandemic. Yields are higher. The world learned how critical supply chains are. And the contribution of air cargo to the bottom line of airlines is more evident than ever.

“Yet, we are still linked to the business cycle and global events. So, the war in Ukraine, uncertainty over where critical economic factors like interest rates, exchange rates and jobs growth are headed are concerns that are real to the business today.

“But they are also ones that we have long experience in dealing with. And they are offset with some certainties.

Sullivan said the middle class continues to grow—if more slowly than pre-pandemic, high value goods and pharmaceuticals need to get to people quickly and e-commerce is growing at around 10% per year.

“Complementing these growth drivers are the efficiencies the industry realized during the pandemic from accelerating digitalization,” he continued. “As we navigate the current situation, air cargo’s priorities have not changed. We need to continue to focus on sustainability, digitalization and safety.”

“Sustainability is our industry’s license to do business and a critical priority,” Sullivan explained. “That is not just for air cargo. It is for all of aviation. That’s why we have committed to net zero carbon emissions by 2050.”

“The most critical area is Sustainable Aviation Fuel (SAF),” he added. “We estimate that 65% of carbon abatement will come from SAF. SAF is being produced. And every single drop is being used. The problem is that the quantities are small. The solution is government policy incentives.

“Through incentivising production, we could see 30 billion litres of SAF available by 2030. That will still be far from where we need to be. But it would be a clear tipping point towards our net zero ambition of ample SAF quantities at affordable prices.

“While we increase SAF production, we know that many shippers, customers, and regulators want immediate carbon-neutral shipping options or assurances that we are operating our businesses as sustainably as possible.”

Sullivan said in addition to specific efforts on sustainability, like any business air cargo needs to continuously improve its efficiency. And the area with greatest potential is digitalisation.

He unveiled three key aims.

The first is 100% airline capability of ONE Record by January 2026

The ONE record initiative will replace the many data standards used for transport documents with a single record for every shipment.

The second is ensuring digital standards are in place to support the global supply chain. Third is ensuring compliance and support for customs, trade facilitation and other government processes that are increasingly digitalised.

“The modernization agenda also includes governments,” Sullivan said. “A lot of work has been done by nations to agree on and to evolve strategies for trade facilitation, reduce operational barriers at borders and to manage the flows of goods securely. Digitalization plays an important role here. One example is IATA’s work supporting the roll out of the EU’s new Pre-Loading Advance Cargo Information (PLACI) System. PLACI went live on 1 March 2023 despite 12 European States not being ready and not having given definitive information about their timelines for readiness. We are working with these states to provide the necessary clarity to enable airlines to adapt their own implementation planning.

“These are big projects. And they are pushing us in the right direction. But we need to move these forward even as the operating environment becomes more challenging.”

He warned the sector had a challenge over safety.

“Alongside sustainability and efficiency is safety,” Sullivan said. “And here the agenda for air cargo continues to be dominated by lithium batteries.

“The first priority is to stop rogue shippers. A lot has been done. But, quite honestly, it is still not enough. Civil aviation authorities must take strong action against shippers not declaring lithium batteries in cargo or mail shipments. And all governments need to support ICAO’s efforts to strengthen the standards in Annex 18 – The Safe Transport of Dangerous Goods.

“So, we still need counter measures in case improperly packaged shipments do get on board. Here we are engaging with EASA and FAA to develop a test standard for fire-resistant aircraft containers with a fire involving lithium batteries. The aim is for ULDs to contain a lithium battery fire for up to six hours.

“We have made progress on the specific challenge of handling lithium battery powered vehicles. From 1 January 2025 we will have a single standard to identify all such vehicles including vehicles such as hover boards, e-scooters and e-bikes, as well as traditional passenger vehicles throughout the transport process.”

“The most critical area is Sustainable Aviation Fuel (SAF),” he added. “We estimate that 65% of carbon abatement will come from SAF. SAF is being produced. And every single drop is being used. The problem is that the quantities are small. The solution is government policy incentives.”

Brendan Sullivan, IATA