Etail by air – here to stay or on a short shelf life?

© Ihor Lysyi |

The Loadstar today launches a series of reports on the ecommerce sector, which has been driving growth in air cargo. But are there clouds on the horizon that should worry air cargo stakeholders in particular? 

Ecommerce currently, depending on the lane, accounts for some 50% to 60% of air cargo volumes. Names such as Temu, never heard in the market as little as one year ago, now are key procurers of airfreight. Forwarders report that in some cases, their entire airfreight capacity has been bought by Chinese ecommerce sellers; whole aircraft are being chartered for cheap clothing; and logistics and transport companies are investing heavily in the sector in the hope of long-term gains. 

But a cognitive dissonance is sounding alarm bells. Instinctively, we know this is not environmentally sustainable – but that is an alarm bell sounding so loudly everywhere, that it is just part of a larger chorus.  

Anything economically unsustainable, however, has a far shorter shelf life.  

Airfreight’s top USP is speed to market. That has generally meant airfreight’s key customers have reasons for urgency: the goods may expire (perishables); urgently needed relief (humanitarian); keeping production lines going and AOG or ship logistics (time critical); or very high-value inventory sellers can’t afford to leave at sea for any length of time (hi-tech). 

And then came fast fashion. Spain’s Inditex launched in the mid-1980s with one strategy in mind: responding to market demand at speed. Instead of taking the traditional year to get products from design to shop floor, Inditex can, in some cases, go from drawing a concept to availability in shops in as little as 15 days – with, of course, the aid of airfreight and some 1,600 flights from the increasingly important Zaragoza Airport a year for Inditex alone.  

Inditex has been around for years, and fast fashion proponents will say that fashion itself is a perishable item, thus the need for speed. But the rise of ecommerce has turned everyone into an Inditex. And it’s no longer just fashion; any item can now be delivered to your door in just a handful of days from the manufacturer in Asia. 

And this is where it starts to make little economic sense.

While air – according to the oft-cited figure by the air cargo industry – carries 35% of global trade by value, it accounts for 1% by weight. Higher-value goods go by air, lower-value goods by sea. But with ecommerce, that has been turned on its head. Remember fidget spinners? $2 toys, which should have been stuffed into a shipping container, were flown. Should sellers of a $5 t-shirt spend between five and 16 times more to go by air? (Only, presumably, if the labour that’s gone into the t-shirt is kept to an absolute minimum.)

Airfreight trends tend to be shortlived. Once upon a time it was all about product launches by hi-tech companies. Or vaccines. Or remember the airbag recalls of 2014? Or, of course, disruption in sea freight, (see any and all US port worker strikes). But one way or another, the industry always rights itself: companies don’t want to pay extra for air, all they really want is the ability to plan, resulting in consistent supply chains.  

So should airfreight really be betting on low-value cargo and the distinct possibility of a short-term trend? You could argue that one of ecommerce’s USPs is speed – and therefore these airfreighted volumes are here to stay. Or, you could believe that, once again, the industry will right itself. With AI making forecasting increasingly accurate – and against a backdrop of ever-weightier concerns over environmental sustainability – will ecommerce turn more consistently to sea freight and regional distribution, leaving just the final few miles between order and delivery?  

Amazon has been focusing on sea freight since 2017, moving some 10,000 containers a month by 2021. And it has also increasingly used sea freight on its on intra-Europe routes. But the Chinese ecommerce platforms have not yet matured to sea freight; Shein, Temu, Taobao, TikTok Shop all happily chartering aircraft or capacity. 

But – as The Loadstar explains in a series of articles looking at the many issues in ecommerce, from duties to data-sharing, from emissions to competition – air freight executives should start to consider how long this phenomenon might last.