Edwin C. Laird
This will be a year of growth and strength in the international main-deck freight-express flying business. We see the international market expanding rapidly, due to an increase in disposable income in Europe and the U.S., and increased disposable income in the maturing Asian economies.
More aircraft are being converted to freighter use, a trend that will continue as bankruptcies restructure the U.S. domestic passenger market. These conversions and orders for new freighters signal acceleration in the replacement and growth requirements for express and all-cargo carriers with more fuel-efficient equipment.
The second important change is a move toward partnership between large multimodal forwarders in Europe and Asia, and eventually the U.S., and the operators of scheduled all-cargo services. Forwarders such as Panalpina, Exel, Expeditors International and Kuehne & Nagel have long chartered all-cargo aircraft or blocked significant space on key routes to meet seasonal requirements. Now this is being done year-round. Forwarders' willingness to share this risk has helped airport-to-airport freighter operators, which are enjoying their first period of sustained profitability. This sharing of ownership risks between forwarders and airlines offers a more profitable business model for both parties.
We see 2005, barring any unforeseen political or terrorist dislocations, as being a year of better-than-average expansion in tonnage carried in the international marketplace equaling 10 percent or more, with the domestic market slowly recovering with growth of 5 to 6 percent, a long-expected and overdue improvement.