MUNICH – Almost in spite of itself, the airfreight industry, which is infamous for its slow uptake of digitized systems, can have a relatively bright future, provided it takes seriously the current challenges of information sharing and customer service, said Lufthansa Cargo’s Alexis von Hoensbroech during his “keynote interview” with Bernd Maresch, owner of Maresch GmbH, at the Air Cargo Europe conference.
Von Hoensbroech, who took over the role of Lufthansa Cargo board member, products and sales, after the departure of Andres Otto five months ago, said he is grateful for his “new kid on the block” status in the cargo business for giving him a healthy perspective on the industry, after spending many years on the passenger side at Lufthansa.
But the “fresh eyes” von Hoensbroech has on the industry don’t always see a pretty picture. He described a conversation he had with a major forwarder back in 2000, talking about how the “dot-com” boom should force the industry to rapidly adopt digital standards to keep up with the rise is e-commerce. “Fifteen years later, it’s obvious the industry hasn’t moved too far,” he said. “I was negatively surprised.”
Von Hoensbroech used the advances in the passenger business over the last two decades as a positive example, citing its near-elimination of paper tickets, its immediate flight status updates and high transparency for customers. The continued use of paper air waybills by about 75 percent of the airfreight industry is the source of “hundreds of thousands of errors” around the world.
“It’s time for the industry to move on and move into the new century. If we don’t, someone else will,” he said, referring to a rash of web-based businesses and integrators that are chipping away at airfreight’s market share. Since air cargo can never compete with seafreight on price, it must differentiate itself through innovation and a renewed focus on customer service.
The trends that are supposed to work against air cargo – such as near-shoring and 3D printing – will take decades to become competitive, meaning there is still time for the industry to work with these trends to their advantage. “The worse the environment is, the stronger the need for innovation becomes.”
However, even with the daunting challenge of speeding up e-freight initiatives, von Hoensbroech said air cargo continues to grow, year after year. “Over many many decades, people have said the air cargo industry will shrink, but it never has,” he said. “Some will say the best air cargo is no air cargo; that seafreight is always the better option. But a lot of customers need air cargo for those perishables that you can’t move to the sea.” There will also be other unforeseen problems, such as the U.S. West Coast port crisis, that will always occur and will always require an airfreight option in an increasingly globalized world, he said.
Because air cargo is a relatively tight-knit group, “where everyone knows everyone,” the industry has the potential to overcome its technology challenges. “But we also have to make sure our processes are better. Information has to come from our customers, and we have to provide services to improve their business.”