Etihad Cargo is anticipating a busier peak season, with current volume already outpacing last year’s, driven by ongoing disruptions to global supply chains and new external developments affecting the usual end-of-the-year demand.

Stanislas Brun, vice president, cargo, at Etihad Airways, told Asia Cargo News that “the peak season has already started” due to different geopolitical reasons: the ongoing war between Russia and Ukraine, events between Iran and Israel, and problems in the Red Sea, which are causing long flights times and affecting planes flying from Asia to Europe.

Demand is also “quite strong,” he said, mainly driven by ecommerce which is taking more and more space on planes. “We also see other commodities like perishables, food, flowers and meats growing strongly, and also pharmaceuticals.”

While current Red Sea disruptions have prompted a shift in some volumes from ocean to air freight, the Etihad executive pointed out that this has started much earlier, prompted by the low water levels at the Panama Canal.

“Some shipping lines had already rerouted their shipments, then the Red Sea happened. More recently, following the implementation of the tariff on electric Chinese cars in the United States, many forwarders and shippers have decided to ship Chinese electric cars to the U.S. as soon as possible, which has led to a lack of capacity in terms of containers out of Asia and the Middle East to Europe, leading to increased demand for air freight,” Brun said.

“We are definitely seeing volume from the ocean,” he said.

Brun told Asia Cargo News that the lack of trains plying routes between Asia and Europe, which were significant before the war in Ukraine but exist on a much smaller scale today, is also putting additional stress on the logistics sector between Europe and Asia.

With events impacting global supply chains, Brun also noted that the “capacity crunch” is coming back, further squeezing available capacity for the peak season.

“There is no longer a necessary seasonality that we knew in air freight; it’s more about external events that are impacting the logistics trend than the seasonality on demand as we knew it,” he said.

Compared to last year, where the peak season was “leaner,” Brun said this year is already very busy.

“This year, what we have seen is a very strong May and June, and we see with the events mentioned [that] we’re already more busy,” Brun said, adding that Etihad is reporting a very strong performance in terms of the load factor, with the airline booking more than 94% of all capacity, whether passenger or freighter.

“We are already seeing all the forwarders and shippers coming to us and trying to find some capacity, and we are working a lot with our partners and with interline to make sure we have the capacity to provide for our customers,” Brun said. “We are exploring all options for additional capacity.”

Ahead of the very busy peak season expectations, Etihad remains focused on remaining flexible to meet demand where it’s needed while maintaining the quality of its service.

The airline is also pushing for digitalization to make its operations more efficient, with Brun saying this is one of his priorities upon his appointment as the new VP of cargo last February.

“This is what’s very important within Etihad, to remain agile and dynamic. What this means is that we’re able to review our program in the course of the year, and we are also redimensioning ourselves in terms of dispatching the capacity to ensure that we have enough planes to deploy based on demand,” he told Asia Cargo News.

Etihad is also working with its partners, such as SF Airlines and Teleport, as well as other airlines and interlines, to provide additional capacity.

Brun noted that general cargo – which also includes ecommerce – continues to take up most of the airline’s capacity, though the carrier is also expanding its pharmaceutical and perishables business. 

Etihad Cargo is also developing products to meet the growing demand for transporting dangerous goods, especially lithium batteries.

“We try to have a mix of commodities when we are looking at what we’re carrying today. It’s very difficult to ignore ecommerce in the belly space. We try to make sure that we have a mix of traditional cargo and also perishables,” Brun said.

“We are strong on pharmaceuticals, and we will continue to reaffirm this. Where we are going a lot, we are offering a solution to make sure lithium-powered high-tech devices are secured during the transport,” he added, citing demand going to Europe and the U.S.

Etihad also continues to put emphasis on further building its pharma vertical, citing Abu Dhabi’s goal to be a premier global hub for pharmaceutical and life sciences distribution. 

Brun cited Abu Dhabi’s “unique” location as being close to Africa, a major destination for vaccines and medicines, as well as to Europe and Asia, both big sources of pharma products. 

“We can fly 99% of the planet in 17 hours out of Abu Dhabi,” Brun said. “This is a very strong point because other than the very small but important islands in the middle of the Pacific, we can reach the world in 17 hours out of Abu Dhabi, which is why our hub is very well-placed in Abu Dhabi.”

Meanwhile, as some supply chain players move towards end-to-end logistics, Brun said Etihad will focus on its core business.

“I really believe that we need to focus on our core. We will continue to reinforce our presence in Abu Dhabi, collaborating with various stakeholders. For instance, our collaboration with Abu Dhabi Ports will continue to enhance our sea-air product and will further develop the connection between us to improve the customer journey,” he told Asia Cargo News.

“We will continue to focus on our core business and to explore capacity solutions and services for our partners,” Brun added.

By Charlee C. Delavin

Asia Cargo News | Hong Kong