Michael Steen, CEO of Atlas Air Worldwide, discusses the current state of the air cargo industry and his company's position. After years marked by the COVID-19 pandemic, the market has recovered in 2023 with a performance 20% higher than the previous year and 4% higher than 2019.
Although air freight represents around 1% of global volumes, it accounts for 35% of global value. However, the sector faces persistent macroeconomic challenges. Industrial production, particularly in China, has yet to reach expected levels, with the PMI index at 49, indicating a lack of growth despite the country accounting for 30% of global air freight. Nevertheless, e-commerce, which accounts for 18% of global retail sales and is growing by 8-9% a year, continues to drive demand for air freight.
The challenges faced by shipping, such as the Houthi attacks, supply chain disruptions and the Panama Canal drought, have indirectly benefited air freight and Atlas Air.
Atlas Air has recently acquired aircraft, including the latest four Boeing 747-8s and six Boeing 777s, as well as ten Boeing 747-400s. The company owns more than 10% of the 650 wide-body freighters that operate intercontinental flights. With around 125 of these aircraft nearing retirement age, the pressure on air freight supply is likely to increase.
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