Copenhagen, Denmark—DSV has completed on 02 May 2025 its full acquisition of DB Schenker from Germany’s Deutsche Bahn for EUR 14.3 billion in cash, establishing the foundation for its future sustainable growth by creating a world-leading player within the transport and logistics industry to further benefit its customers.
DB Schenker is one of the most powerful and innovative teams in the transportation and logistics industry with more than 150 years of experience. DSV said the acquisition will strengthen DSV’s global network, expertise and competitiveness, benefiting employees, customers and investors.
DSV has a long track-record of successfully integrating acquired companies as an integral part of the company’s growth strategy.
DSV and Schenker are an excellent strategic match due to similarities in business models, services and strategies, and the combined company will benefit from strong customer relationships, industry vertical expertise, an agile global network and service offerings, combined with operational synergies.
Based on the published full-year 2024 financials for DSV and Schenker, the combined company had a pro-forma revenue of approximately DKK 310 billion and a total workforce of close to 160,000 employees in more than 90 countries.
“With the completion of the acquisition of Schenker, we have reached a milestone in the history of DSV. We have been looking forward to completing the transaction and I am excited to welcome our new colleagues to the DSV organization. With this acquisition, we become a world-leading player in global transport and logistics, at a time where global supply chains are more in focus than ever before, and our customers need a reliable and agile global network of services and products. By combining the two companies we will create a unique flexible platform for long-term financial growth to the benefit of our customers, employees, shareholders and other stakeholders,” said Jens H. Lund, Group CEO of DSV.
Transaction details and expected financial impact
Schenker will be included in the consolidated financial statements of DSV from 1 May 2025. Based on preliminary estimates, annual synergies are estimated in the level of DKK 9.0 billion at end of 2028, when the majority of the integration is expected to be complete. The synergies relate to the consolidation of operations, logistics facilities in Road and Solutions, back-office functions, finance and IT infrastructure.
The transaction is expected to be EPS accretive (diluted and adjusted) at the latest in 2026, and it remains DSV’s aspiration to lift the operating margins of the combined entity to a minimum of DSV’s levels within the respective business areas in 2028, based on a normalised full-year 2024 EBIT baseline for Schenker of approximately DKK 6.0 billion (approximately EUR 800 million).
Total transaction and integration costs are expected in the level of DKK 11.0 billion. These costs will be charged to the statement of profit and loss under special items during the integration period.
Due to completion of the transaction, DSV’s financial ambitions for 2026 will be revised and are therefore no longer relevant. Revised financial ambitions reflecting the impact from the integration of Schenker are expected be communicated at a later stage.
Capital structure
In October 2024, DSV successfully raised approximately DKK 75.0 billion (EUR 10.0 billion) through an evenly split combination of equity and bond issuances to partially finance the acquisition of Schenker. The remaining financing of the transaction will be covered by cash position and existing committed credit facilities.
DSV is targeting an unchanged capital structure with a financial gearing ratio of a net interest-bearing debt including leasing liabilities below 2.0x EBITDA before special items. At completion of the transaction, the pro-forma financial gearing ratio is expected to be around 3.0x. The ambition remains to meet the targeted financial gearing ratio again latest by H1 2027.
Governance
Further, with reference to DSV’s Announcement No. 1149 of 28 January 2025, DSV’s Board of Directors intends to nominate current CEO of Schenker, Jochen Thewes, for election to the Board of Directors of DSV. A separate notice for an extraordinary general meeting is expected in H2 2025.
Outlook for 2025
Following completion of the Schenker acquisition, the preliminary expected impact from the acquisition is included in DSV’s full-year outlook for 2025, which is upgraded as follows:
The expected contribution from Schenker during the integration period, including synergies and integration costs, is based on preliminary estimates and assumptions. Alignment of Schenker’s financials to DSV’s definitions and accounting standards is still in progress.
An update on the integration will be communicated with the release of DSV’s H1 Interim Financial Report, which is postponed from 24 July 2025 to 31 July 2025. For further details and assumptions related to the outlook, we refer to the Q1 2025 Interim Financial Report.
The current geopolitical landscape, including the Red Sea situation, macroeconomic factors and the global trading environment, particularly potential demand risks arising from the announced trade tariffs, remain uncertain, and unforeseen changes may impact our financial results. We continue to monitor activity across our organization, and we will adjust capacity and our cost base if needed.
Emirates SkyCargo, the cargo arm of the world’s largest international airline, Emirates, is setting its sights to even greater heights in the skies. Operating two world-class cargo terminals in Dubai with a combined capacity of over 2.3 million tons per annum, Emirates SkyCargo, the global leader in air freight services, offers a broad range of solutions across multiple industries. The company is working to further bolster its capacity to meet increasing demand for air transport in today’s digital age where e-commerce continues to change the global business landscape.
The Dubai-based cargo airline has 13 Boeing 777 freighters on order, and expects to operate a fleet of 21 aircraft by December 2026. Costing USD 1 billion, the order is part of Emirates’ total order book of 315 wide-body aircraft.
Founded in 1985, Emirates SkyCargo’s modern fleet of aircrafts connects the world to a network of over 145 destinations and 38 destinations served by freighters, spanning 83 countries and territories across six continents, including 50 dedicated freighter locations.
Each aircraft is highly capable of supporting diverse types of cargo, from perishables to pharmaceuticals, to e-commerce and live animals, to other high-value goods, handled with care by its cargo and logistics experts. Its state-of-the-art facilities from the plane down to the ground, guarantees the safety and integrity of its diverse shipments.
In an exclusive interview with Air Cargo Update, Badr Abbas, Divisional Senior Vice President of Emirates SkyCargo, outlines the company’s strategic vision for the future, focused on modernization, technology adoption, and sustainability.
With over two decades of experience in the air cargo and aviation industry, Abbas is a seasoned professional with a deep understanding of global logistics.
He joined Emirates in 2000 and has held various key positions within the airline, contributing significantly to its growth and expansion. Before taking on his current role, he served as Emirates’ Senior Vice President for Commercial Operations – Africa, and was instrumental in driving strategic initiatives and enhancing the airline’s global presence.
Abbas highlights company’s plans to expand the freighter fleet to 21 Boeing 777Fs by 2026 – strengthening Emirates SkyCargo’s position as a key player in global trade.
He also discussed the increasing importance of cold chain logistics for pharmaceuticals, with the company investing heavily on state-of-the-art facilities to maintain the integrity of sensitive shipments.
Abbas highlighted the company’s focus on digital tools like e-Quote and eSkyCargo to enhance customer experience, alongside efforts to grow its operations in emerging markets like Africa.
Looking ahead, Abbas aims to leverage innovation, technology, and customer-centric solutions to strengthen the global supply chains. With robust growth strategies, Emirates SkyCargo continues to be a force to be reckoned with in the skies.
As the new Divisional Senior Vice President, what is your strategic vision for Emirates SkyCargo? What immediate priorities have you identified for the division?
Emirates SkyCargo has built a reputation for excellence in global logistics industry. My vision is to take it even further – positioning it as a trusted partner that seamlessly connects businesses and communities worldwide. Right now, our top priorities include modernizing our freighter fleet and ensuring we provide the fastest, most reliable connections for key air cargo trade routes through Dubai.
Our strategies will focus on embracing cutting-edge technology and strengthening our customer partnerships and driving sustainable growth. We aim to redefine the future of air cargo and contribute to the prosperity of the global economy.
With over 24 years at Emirates, including roles in commercial operations across various regions, how do you plan to leverage your vast experience to drive growth and innovation within the Emirates SkyCargo?
Having spent over 24 years at Emirates in various commercial roles across different regions, I have seen how innovation and customer centricity can transform industries. My journey with Emirates taught me the power of collaboration, adaptability, and long-term vision. I am excited to bring these insights into Emirates SkyCargo, fostering new opportunities for growth and inspiring our teams to push boundaries. The goal is to keep Emirates SkyCargo at the forefront of innovation, strengthening connections between communities and economies worldwide.
The company has announced plans to expand its freighter fleet to 21 Boeing 777Fs by 2026. Could you elaborate on the strategic considerations behind this significant investment and how it aligns with your long-term growth objectives?
Expanding our freighter fleet is an ambitious step and a testament to our belief in the limitless potential of global trade. By adding more Boeing 777Fs, we are not just growing our capacity – we are strengthening our ability to tap into emerging markets while bolstering reliability with our partners. The Boeing 777 freighters are the epitome of efficiency and sustainability, perfectly aligned with our vision to serve as the backbone of global supply chains and strengthen Dubai’s position as a leading air cargo hub.
In the meantime, while we wait for these new freighters, we have already taken steps to expand capacity by wet-leasing two additional Boeing 747s. This allows us to meet immediate demand while continuing to integrate dedicated freighters with our wide-body passenger fleet, giving us the flexibility to move goods swiftly and efficiently worldwide.
With the recent launch of e-Quote and the refresh of digital channels like eSkyCargo and SkyCargo.com, how do you envision these tools enhancing customer experience and operational efficiency?
Digital innovation is reshaping our industry, and tools like e-Quote, eSkyCargo, and SkyCargo.com are giving our customers more control and convenience than ever before. Being present on major global platforms like WebCargo, Cargo.one, and Cargo.ai means we are right where our customers need us, making it easier to book even specialized shipments like pharmaceuticals. And the impact is clear.
Today, more than 60% of our bookings happen digitally. This not only increases efficiency and cuts down on manual tasks but also frees up our teams to focus on handling more complex shipments—like Emirates valuables and pet transportation. It’s more than just an upgrade—it’s a whole new way of thinking about air cargo logistics.
Given recent increasing operations across African destinations, how is Emirates SkyCargo adapting its services to meet the growing demands in this region?
Africa is becoming a major player in global trade, and Emirates SkyCargo is helping businesses across the continent connect with international markets. By combining our dedicated freighters with the cargo capacity of our passenger aircraft, we provide the flexibility to move goods smoothly across 20 key African destinations and beyond. Our extensive trucking network adds another layer of connectivity, ensuring cargo reaches its destination efficiently.
Take South Africa, for instance—we transport goods by truck between Johannesburg, Cape Town, and Durban. While Africa remains a key market, we have also seen rising demand from regions like the Far East and West Asia, especially for e-commerce and high-tech products.
These goods move through Dubai, connecting to major markets in the Middle East, Europe, and the U.S. On top of that, we have introduced dedicated freighter services to Copenhagen to support the growing export of pharmaceuticals and perishable goods. At the core of it all, we are committed to facilitating global trade with reliability and care.
Emirates SkyCargo has achieved a remarkable increase in cargo volume heading into 2025. What key strategies and operational enhancements have contributed to their growth and how do you plan to sustain this momentum in the coming year?
Our 16% year-on-year growth, reaching 1.2 million tons, is a clear sign of the trust our customers place in us and our commitment to delivering excellence. The rise in e-commerce, increasing demand for perishables, and our customized solutions have been key drivers of this success.
Looking ahead, our 10-year strategy is set to double our capacity, expand our network, and strengthen our position as a leader in air cargo logistics. With a fleet of 21 freighters by December 2026 and a customer-first mindset, we are excited to shape the future of global trade.
Sustainability is a growing focus in the aviation industry. What initiatives has Emirates SkyCargo undertaken to reduce carbon footprint? Is SkyCargo exploring sustainable aviation fuels or other eco-friendly logistic solutions?
As we continue to grow, sustainability remains at the core of everything we do. Our fuel-efficient aircraft and innovative operations help us cut down on our carbon footprint, and initiatives like joining ‘The Move to -15 Degrees’ global coalition are pushing industry standards forward. Beyond our day-to-day operations, we are also taking a stand against illegal wildlife trafficking.
In 2023, we were proud to earn the IATA Environmental Stage 1 certification—an important milestone in our journey. At Emirates SkyCargo, we are not just moving cargo—we are shaping a greener, more responsible future for the logistics industry.
In light of recent global supply chain disruptions, like there was global IT outage and strikes across the world within the logistics industry, how has Emirates SkyCargo updated its operations to maintain reliability and meet customer expectations?
Adapting to disruptions is in our DNA. By diversifying our network, embracing technology, and building strong customer relationships, we have developed a solid foundation to handle global challenges. When obstacles come our way, we see them as chances to innovate and stay ahead—making sure our customers can always count on us to keep their supply chains moving, no matter what.
Beyond digital platforms, is Emirates SkyCargo exploring the integration of emerging technologies like AI, IoT, blockchain to further enhance logistic and cargo management?
Emerging technologies like AI, IoT, and blockchain are shaping the future of logistics, and we are fully embracing them to transform how we operate. Whether it’s real-time tracking, predictive analytics, or improving transparency, these advancements are redefining air cargo logistics. Automation is helping us tackle labor shortages, while AI is making route planning smarter and optimizing fleet maintenance.
At the heart of it, our goal is to blend advanced technology with human expertise, ensuring we stay at the forefront of innovation and deliver exceptional service.
Cold chain logistics are crucial for pharmaceutical shipments. What advancement has Emirates SkyCargo made in its temperature control solutions to ensure the integrity of sensitive pharmaceutical products?
Pharmaceutical shipments are critical, and we take that responsibility seriously. That’s why we have invested USD 200 million to ensure every shipment is handled with the utmost care. Our cutting-edge, 15,000 square-meter GDP-certified facilities in Dubai are the largest and most advanced in the world, featuring temperature-controlled storage, cool dollies, and innovative solutions like water-resistant covers.
At Emirates SkyCargo, we are proud to lead the market, moving over 2 million kilograms of pharmaceuticals every week. With a network of 44 pharma corridors, we maintain high cold chain standards across the globe—ensuring life-saving treatments get to the people who need them, reliably and efficiently.
How is Emirates SkyCargo adapting its services to meet the needs of growing e-commerce hubs, particularly in regions like the Middle East and South Asia? Are there any recent investments in SkyCargo’s facilities or fleet to support the growing volumes of e-commerce shipments?
E-commerce is transforming the global economy, and we are here to help businesses succeed in this fast-moving landscape. Our extensive network, frequent flights, and specialized infrastructure ensure we deliver both speed and reliability to our B2C and B2B customers. As e-commerce continues to grow, product cycles are getting shorter, and the demand for faster fulfillment is rising.
To keep up, we are expanding our fleet with additional freighters and A350s featuring enhanced belly-hold capacity—ensuring we meet these demands head-on. At Emirates SkyCargo, we are driving e-commerce growth through innovation and efficiency.
How does Emirates SkyCargo anticipate global airfreight demand, and how are you looking forward to your operations in the coming next 5-7 years, and what steps are being taken to position the company for these changes?
The next five to seven years are set to be a game-changer for us. With growing demand for e-commerce, perishables, and pharmaceuticals, we are gearing up by expanding our fleet, focusing on sustainability, and pushing forward with digital innovation. A major milestone on the horizon is Dubai’s expansion of Al Maktoum International Airport – soon to be the world’s largest cargo hub.
With the capacity to handle 12 million tons of cargo annually, this development puts Emirates SkyCargo right at the center of global trade. It will also drive the growth of the nearby logistics district, which is set to become a hub for global cargo and shipping companies. This is all part of Dubai’s ambitious plan to lead the world in multi-modal cargo operations across air, sea, and land. We are not just keeping up with demand—we are actively shaping the future of air cargo logistics.
E-commerce volumes, for so long the savior of global air cargo demand, are today facing up to the ‘seismic shock’ of the United States’ ‘Liberation Day’ global tariffs announcement, while the general cargo market is also reevaluating its future as shippers, forwarders, airlines, and consumers come to terms with the economic reality of new import taxes and a potential international trade war.
US President Donald Trump confirmed on 03 April the elimination of duty–free de minimis treatment for low-value imports from China and Hong Kong, starting 2 May 2025. All relevant postal items valued at or under USD 800 previously qualifying for the de minimis exemption will become subject to a duty rate of either 30% of their value or USD 25 per item (increasing to USD 50 per item after 1 June 2025).
The announcement was one of many as President Trump imposed sweeping global import taxes on goods into the United States from 9 April 2025.
Already reeling from the potential impact of the US’ actions, global air cargo demand is likely to suffer further harm from retaliatory actions by other countries. EU President, Ursula von der Leyen, called the US decision “a major blow for the world economy.”
After more than a year of double-digit growth, air cargo now faces an uncertain future. “In my 30 years working in the air freight industry, I cannot remember any other unilateral trade policy decision with the potential to have such a profound impact on the market at a global level,” said Xeneta’s Chief Airfreight Officer Niall van de Wouw.
“E-commerce has been the main driver behind air cargo demand. If you suddenly and dramatically remove the oxygen from that demand, it will cause a seismic shock to the market,” he added.
Cross-border e-commerce has evolved as the major driver for global air cargo demand growth in recent years. China-to-US e-commerce shipments alone account for roughly half of the cargo capacity on this eastbound corridor and around 6% of global air freight demand. A disruption to this demand will free up a significant part of this corridor’s cargo capacity and spread its impact to the rest of the market, van de Wouw said.
New air cargo market data for March clearly indicated shippers and forwarders were ‘hedging their bets’ and buying time before making longer-term commitments to air cargo capacity as they waited to see how the impact of newly-imposed tariffs and international trade tensions unfolded. March showed no drastic signs of panic as demand rose +5% year-on-year against a strong comparison 12 months ago.
The economic fallout following these events is now likely to place further pressure on airfreight rates. Global air cargo spot rates in March continued their levelling out trend seen over the past year, increasing at their lowest pace since June 2024 at +6% year-on-year.
Given the tumultuous market uncertainties, the latest air cargo market data reflected the cautious ‘wait and see’ approach being adopted by industry stakeholders. Shippers negotiating contracts in Q1 2025 preferred shorter-term agreements of 3 months or less, representing 79% of contracts – an increase of nearly 20 percentage points year-on-year. Meanwhile, freight forwarders continue to place approximately 45% of their volumes in the spot market.
“With the growth of rates slowing overall, we’d normally expect to see shippers making longer capacity commitments to achieve more competitive rates, but, right now, this is clearly a gamble few shippers are ready to take – and this is before we’re even seeing tariffs impacting volumes,” said Niall van de Wouw, Xeneta’s Chief Airfreight Officer.
E-commerce volumes still buoyant – but for how long?
In terms of regional developments, despite double-digit demand growth month-on-month in March, Northeast Asia to Europe spot rates were unchanged at USD 4.28 per kg as airlines allocated more capacity to the market. Thanks to buoyant e-commerce demand during the month, the corridor’s spot rate increased +14% year-on-year. In contrast, the trade imbalance meant backhaul trade showed a -2% rate decline month-on-month and -14% year-on-year to USD 1.37 per kg.
The Northeast Asia to North America market showed a noticeable spot rate increase of +9% month-on-month to USD 4.17 per kg, undoubtedly driven by the temporary removal of the de minims threshold for Chinese shipments in early February.
Similar to the Europe to Northeast Asia corridor, the North America to Northeast Asia market showed a slight decline of -1% month-on-month and a considerable -20% spot rate reduction year-on-year.
Embracing a dynamic phase of growth and innovation, Delta Cargo combines technology and innovative solutions and its sizeable belly-hold capacity through Delta Air Lines’ over 4,000 daily flights to connect more businesses, e-trade, and economies across continents.
Delta Cargo is the air cargo division of Delta Air Lines, the oldest operating airline in the US which ranks first globally in terms of market capitalization and total assets with its revenue soaring to nearly $62 billion in 2024.
Leveraging the belly space in Delta’s passenger aircraft, with a global network spanning across more than 290 destinations on six continents, Delta Cargo offers comprehensive freight services across the Americas, Europe, Asia, and beyond.
Its commitment to customer-centric innovation, ensuring seamless operations, and tailored services that meet evolving industry demands, sets it apart from the rest of major players in the air cargo industry.
At the heart of Delta Cargo’s strategy is an emphasis on leveraging technology and optimizing its fleet. Recent additions of wide-body aircraft like the Airbus A350-900 have significantly
boosted capacity. And participation in the SkyTeam Alliance and joint venture partnerships with Aeromexico, Air France KLM, Korean Air, LATAM, and Virgin Atlantic enhance reach and service integration. Pioneering initiatives like the new DeliverDirect product, which streamlines package delivery from retailers’ warehouses to consumers’ doorsteps, and its IATA CEIV-certified
Specialized Pharma product highlight Delta Cargo’s innovative edge.
In an exclusive interview with Air Cargo Update, Peter Penseel, President of Delta Cargo, outlines his vision for the future, focusing on operational excellence, digitalization, and doubledigit growth while pushing for more global expansion.
Penseel joined Delta Cargo last year, bringing with him over three decades of experience in air cargo and logistics. Previously he held leadership positions at CEVA Logistics, with his last post as Chief Operating Officer – Airfreight, driving innovation and expanding cargo capacity. He also worked with Qatar Airways Cargo, DHL Global Forwarding, and UTi Worldwide, where he honed his expertise in global freight management.
Penseel’s contributions to the industry earned him recognition as Cargo Executive of the Year by Air Cargo World in 2021.
A native of the Netherlands, Penseel is also a member of the Supervisory Board of Maastricht Aachen Airport. His career journey reflects a passion for advancing the cargo sector, paired with an unwavering commitment to excellence and innovation. Here’s our Q&A with him.
Could you provide a brief overview of Delta Cargo before we delve into the details of your expansion plans?
At Delta Cargo, we’re at a pivotal moment right now. Our focus is on optimizing our network to offer more options for our customers while making strategic decisions about where we can grow. The air cargo industry isn’t always straightforward, but as a belly carrier operating on Delta’s extensive global network of over 4,000 daily flights, we have immense opportunities to expand and innovate.
We’re constantly looking to redesign and improve our service, with a strong team and a clear vision for the years ahead. That’s what I’m committed to-protecting, nurturing, and growing what we’ve built.
At The International Air Cargo Association (TIACA) Air Cargo Forum conference in Miami last November, we showcased that readiness. Our booth was buzzing with visitors, and it was energizing to see such positive engagement.
What sets us apart is our collaborative approach. We value our customers and strive to work together with them to find solutions. That collaboration is, in my opinion, the key to success and the way forward for the industry.
How is Delta Cargo expanding its reach and capabilities in air cargo solutions? Could you provide insights into any new solutions or services that are being introduced to address this specific area?
Well, one of the main ways we’re expanding is through the growth of our fleet. We’ve added more wide-body aircraft, including the Airbus A350-900s, and are looking forward to the addition of A350-1000s in 2026. This fleet expansion automatically boosts our cargo capacity. And it’s not just about the fleet – we also benefit from being part of SkyTeam. The SkyTeam alliance allows us to tap into the capabilities of all our partners, ensuring that we all deliver the same level of operational excellence and service.
An impactful recent development is our Cargo joint venture with LATAM Cargo; we’re celebrating the 1 year anniversary of our partnership on March 1. By integrating our networks, we’re able to offer a seamless experience to our mutual customers, through streamlined operations and by leveraging a more extensive network across both North and South America. This partnership also unlocks more capacity for specialized products, like pharmaceuticals and fresh produce.
How has the US air cargo market evolved in recent years, and what new opportunities are emerging in this region?
As I mentioned earlier, we operate more than 4,000 flights a day, with the majority being narrow-body aircraft. With the rise of e-commerce and the growing demand for cargo, we’ve developed one of the best networks to serve customers in this market. We bring cargo from Asia and Europe and efficiently distribute it to final destinations across North America. Our network is a huge asset. The market itself is maturing, and it’s crucial to be at the top of your game since it’s all about timing. We’re doing an excellent job in this area, and there’s definitely more to come.
How do you view the air cargo markets in Canada and Latin America?
Latin America is seeing growth overall because people there have more purchasing power now. Canada, on the other hand, is already a mature market. When we talk about North America, including Canada and Mexico, heading towards South America, there’s a lot of growth in the products being produced there, especially in the vegetable and flower markets. This adds significant value to the trade. We refer to this as the southbound market, while the northbound business is also very strong and healthy for airlines like Delta.
What are some of the recent product innovations and solutions introduced by Delta Cargo to meet the evolving demands of the air cargo sector?
One of the key products we’re always focused on innovatingis our Specialized Pharma product, which is CEIV-certified. This ensures the highest standards for transporting critical and sensitive pharmaceutical goods and instills trust with our customers. One recent development is our new DeliverDirect service, serving customers in the small parcel direct-toconsumer shipping market in the US. Traditionally, air cargo carriers primarily handle airport-to-airport shipments, but with Delta Cargo DeliverDirect, we can now handle the final mile as well. This service is a major value-add, and it has shown great potential for growth over the past year.
Is this approach designed to eliminate the middleman?
No, it’s not about eliminating the middleman. Typically, customers have to arrange both the initial pickup and the finalmile delivery with another provider. What we’re doing now is offering a one-stop solution — from handling pickup from the retailer’s warehouse to delivery to the final consumer. It’s all streamlined through a single service.
Given the growing e-commerce demand and the increasing complexity of supply chains, what specific technologies or solutions is Delta Cargo implementing to address these challenges?
We’ve paired up with companies like SmartKargo, which offers the software and capabilities to manage the first and final mile, supporting our DeliverDirect model. By collaborating with industry experts, we’re able to create added value. But it’s not just about having the best solution; it’s also showing customers why choosing Delta Cargo is the best option for them. The market is incredibly competitive, so we’re focusing on how to quantify the value of using our services and making it clear to customers that Delta Cargo is the right choice.
With the rise of e-commerce, how is Delta Cargo collaborating with airports and logistics partners to address infrastructure challenges and improve the seamless handling of cargo?
A key part of addressing these challenges is sharing expected volumes with our partners early on. By providing this information upfront, we help them plan ahead-whether it’s ensuring they
have enough staff or the right equipment to handle the cargo. It all starts with effective planning, and that’s especially important for products with high demand like this.
Regarding the integration of partners, what digital channels is Delta Cargo utilizing, and what progress have you made in terms of digitalization investments?
We’ve invested in a new global operating platform called iCargo, overhauling our legacy system across our entire operation. Operated by IBS Software, iCargo is versatile-it can be used for managing warehouse activities and trucking schedules, and it allows for increased automation. iCargo will help facilitate faster and more accurate communications with our customers, as well as speedier service recovery. Speed and accuracy reduce inefficiencies, enabling us to focus more on delivering excellent customer service.
What sustainability initiatives are Delta Cargo implementing?
Delta is working towards achieving net-zero emissions by 2050 by focusing on sustainability measures that are in our control today. We offer our cargo customers a Sustainable Aviation Fuel (SAF) program to reduce the scope 1 and scope 3 emissions associated with air freight. SAF is the best near-term lever our industry has to achieve our
decarbonization goals, but there isn’t enough of it available to fuel commercial airline demand for a single week, and it’s also two to four times as expensive as conventional jet fuel. So we’re working with our customers to help increase supply and bring down the price. Another major focus for Delta is investing in new aircraft with increased fuel efficiency. We recently announced orders for 20 next-gen A350-1000s (that we’ll start taking delivery of in 2026 for our international operations), which will be 20% more fuel efficient than the widebody aircraft we’ll be retiring.
What are the key trends you foresee in the air cargo and logistics industry in the coming years?
I believe air cargo will continue to thrive in 2025, just as we’re seeing strong growth today, with double-digit growth expected. Of course, there will always be challenges-that’s part of the industry. But after 30 years in this field, I can confidently say that the opportunities outweigh the obstacles. I always look at things optimistically, and I see the same for the air cargo industry in 2025.
How do you view the air cargo markets in the Middle East and Africa?
The Middle East market will continue to be strong, especially in certain regions where there isn’t a large local consumer market. This means that key airports in the Middle East will remain
important transit hubs. Even if only 10% of the cargo they bring in is consumed locally, it still represents a significant volume. As a result, these markets will need to keep investing in additional capacity to maintain healthy load factors. Additionally, with new airport expansions, like Riyadh and other developments in Saudi Arabia, we’ll see continued growth in the region.
How do you view the unique position of Saudi Arabia, particularly in terms of its air cargo potential?
Saudi Arabia is in a unique position compared to other markets. It has a large population to serve, which gives it a different dynamic. Riyadh, in particular, has the potential to become more
self-sustaining, which is a great thing. It could become more independent in terms of its air cargo needs, making it a strong player in the region.
What are your expectations for Delta Cargo over the next three to five years?
We’re focused on growth and hope to continue seeing doubledigit growth in the coming years. But it’s important to remember that everything starts with service. Operational excellence is
key. Before we seek more business, we need to ensure we’re consistently delivering what our customers expect. That’s our main goal for Delta Cargo in the years ahead.
Air cargo was a standout performer in 2024, growing 11.3% —outpacing passenger demand. E-commerce expansion and disruptions in sea shipping kept demand high, with yields 39% above 2019 levels. Looking ahead, 2025 is set for another 5.8% growth, but challenges loom: geopolitical uncertainty, inflation, and potential U.S. policy shifts, including new tariffs.
These pressing issues will take center stage at the IATA World Cargo Symposium (WCS) 2025 in Dubai from the 15-17 April. Industry leaders will explore how air cargo can navigate an increasingly complex global trade environment. The symposium will feature plenary sessions, specialized tracks, workshops, and executive summits, addressing:
The strength of e-commerce will represent a growing portion of air cargo business. Currently, e-commerce averages about 20% of cargo business industry-wide, but it is expected to grow to at least a third of all cargo shipments. Given that, by 2027, e-commerce is expected to be an $8 trillion market segment, the sector stands to reap a significant reward if it can get its product correct.
The Digitalization Stream at WCS will explore how digital solutions are adapting to meet this demand and reshape the industry. Executives will open discussions with keynotes on implementing digital strategies, followed by a fireside chat on IATA’s Digitalization Leadership Charter, which was established to accelerate and sustain the industry’s digital transformation. As of December 2024, 17 organizations had signed on.
In addition, a panel will explore the challenges and opportunities as the industry moves towards its target for the adoption deadline for ONE Record by January 1, 2026—a major milestone in data standardization. Spotlight sessions will highlight the power of data transparency, workflow optimization, and AI-driven innovations to enhance efficiency and accuracy.
Digitalization and sustainability go hand in hand. With half of all air cargo traveling on passenger aircraft, sustainability efforts will significantly impact the industry’s environmental goals. Reducing paper usage, optimizing cargo space, and minimizing single-use plastics are priorities. Circularity initiatives—such as recycling Unit Load Devices (ULDs) and increasing the use of Sustainable Aviation Fuel (SAF)—are critical to reducing air cargo’s carbon footprint.
WCS 2025 will feature:
The day will conclude with real-world case studies, providing actionable insights into enhancing transparency in environmental reporting and social impacts.
Geopolitical risks remain a wildcard for air cargo. Potential U.S. tariffs could create short-term spikes in demand—just as seen during the 2018–2019 U.S.-China trade war when businesses rushed to move goods before new duties took effect. Recent IATA data suggests a similar pattern, with December air cargo rates from Asia to the U.S. rising 8%.
However, the long-term effects could be more disruptive. Higher costs may weaken demand, drive regional sourcing, or push volumes toward ocean freight. Stricter e-commerce regulations, including changes to de minimis exemptions, could further complicate cross-border trade.
At WCS 2025, industry experts will discuss strategies to enhance resilience—from adapting to shifting trade policies and regulatory environments to strengthening supply chain security in an evolving threat landscape.
To support the industry’s goals, WCS will also feature workshops on key industry topics, including:
The future of air cargo depends on collaboration across the ecosystem—airlines, logistics providers, technology firms, regulators, and shippers. Dubai, with its world-class logistics infrastructure and strategic position at the crossroads of global trade, offers the ideal setting for these crucial discussions.
As IATA, Emirates SkyCargo and dnata welcome industry stakeholders to WCS 2025, the focus will be on driving innovation, enhancing efficiency, and ensuring air cargo remains a pillar of global trade.
WCS 2025 is more than just an industry event—it’s a call to action. The discussions in Dubai will shape the industry’s trajectory for years to come. The question is not whether air cargo needs can navigate the current environment, but how quickly it can adapt to new global realities.
The answer will define the future of air cargo.
Geneva, Switzerland: Air cargo and passenger demand in 2024 reached record-high, with growth of 11.3 percent and 10.4 percent, respectively, incurred during the year compared to 2023, according to the International Air Transport Association (IATA).
Full-year demand for 2024, measured in cargo ton-kilometers (CTK), increased 11.3% (12.2% for international operations) compared to 2023. Full-year 2024 demand exceeded the record volumes set in 2021, according to IATA which represents 340 airlines comprising over 80% of global air traffic.
December 2024 brought the year to a close with continued strong performance. Global demand was 6.1% above December 2023 levels (7.0% for international operations). Global capacity was 3.7% above December 2023 levels (5.2% for international operations). Cargo yields were 6.6% higher than December 2023 (and 53.4% higher than in December 2019), IATA continued.
“Air cargo was the standout performer in 2024 with airlines moving more air cargo than ever before. Importantly, it was a year of profitable growth. Demand, up 11.3% year-on-year, was boosted by particularly strong e-commerce and various ocean shipping restrictions. This combined with airspace restrictions which limited capacity on some key long-haul routes to Asia helped to keep yields at exceptionally high levels. While average yields continued to soften from peaks in 2021-2022 they averaged 39% higher than 2019,” said Willie Walsh, IATA’s Director General.
Looking to 2025, IATA estimates growth to moderate to 5.8%, aligned with historical performance. “Economic fundamentals point to another good year for air cargo—with oil prices on a downward trajectory and trade continuing to grow. There is no doubt, however, that the air cargo industry will be challenged to adapt to unfolding geopolitical shifts. The first week of the Trump administration demonstrated its strong interest in using tariffs as a policy tool that could bring a double whammy for air cargo—boosting inflation and deflating trade,” said Walsh.
IATA pointed out several factors in the operating environment should be noted:
Global travel at an all-time high
IATA said the total full-year passenger traffic in 2024 (measured in revenue passenger kilometers or RPKs) rose 10.4% compared to 2023. This was 3.8% above pre-pandemic (2019) levels. Total capacity, measured in available seat kilometers (ASK), was up 8.7% in 2024. The overall load factor reached 83.5%, a record for full-year traffic.
International full-year traffic in 2024 increased 13.6% compared to 2023, and capacity rose 12.8%. Domestic full-year traffic for 2024 rose 5.7% compared to the prior year, while capacity expanded by 2.5%.
December 2024 was a strong finish to the year with overall demand rising 8.6% year-on-year, and capacity grew by 5.6%. International demand rose by 10.6% and domestic demand by 5.5%. The December load factor reached 84%, a record for the month.
“2024 made it absolutely clear that people want to travel. With 10.4% demand growth, travel reached record numbers domestically and internationally. Airlines met that strong demand with record efficiency. On average, 83.5% of all seats on offer were filled—a new record high, partially attributable to the supply chain constraints that limited capacity growth. Aviation growth reverberates across societies and economies at all levels through jobs, market development, trade, innovation, exploration, and much more,” said Willie Walsh, IATA’s Director General.
“Looking to 2025, there is every indication that demand for travel will continue to grow, albeit at a moderated pace of 8.0% that is more aligned with historical averages. The desire to partake in the freedom that flying makes possible brings some challenges into sharp focus. First, the tragic accident in Washington last night reminds us that safety needs our continuous efforts. Our thoughts are with all those affected. We will never cease our work to make aviation ever safer.
Second is the airlines’ firm commitment to achieve net zero carbon emissions by 2050. While airlines invested record amounts in purchases of Sustainable Aviation Fuel (SAF) in 2024, less than 0.5% of fuel needs were meet with SAF.
SAF is in short supply and costs must come down. Governments could fortify their national energy security and unblock this problem by prioritizing renewable fuel production from which SAF is derived.
In addition to securing energy supplies and increasing the SAF supply, diverting a fraction of the subsidies given for fossil fuel extraction to support renewable energy capacity would also boost prosperity through economic expansion and job creation,” said Walsh.
In an exclusive dialogue with Air Cargo Update’s Associate Publisher, Poonam Chawla, Dr. Raman Kumar, the pioneering Managing Director of Al-Futtaim Logistics, reveals the company’s groundbreaking strategies and its ascent to the zenith of industry excellence.
As the MENA region catapults onto the global stage as a pivotal player in air cargo, Dr. Kumar’s insights offer a captivating glimpse into the future of logistics. From cutting-edge 5G tracking systems to AI-powered document processing, Al-Futtaim Logistics is harnessing state-of-the-art technology to navigate the complexities of a post-pandemic world.
New Markets for Aerospace
How is the MENA region emerging as a key player in the global air cargo industry?
The air cargo industry is at a transformative juncture. Digitization, e-commerce and sustainability will remain pivotal in shaping its future. Companies that embrace these trends and invest in innovative solutions will lead the way.
The MENA region is on the cusp of becoming the epicenter of global air cargo operations. Airlines like Emirates, Qatar Airways and Saudia Cargo are driving this growth, supported by the region’s strategic location.
The geographical advantage allows for swift connections between Asia, Europe and the Americas. Goods often transition from sea to air in this region, facilitating rapid delivery to destinations worldwide. For example, Saudi Arabia’s central position enables quick deliveries to key markets within hours.
Visions like Saudi 2030 and the UAE’s development plans underscore the region’s potential. With strategic investments and advancements, the MENA region is poised for remarkable growth in the air cargo sector.
In 2025, we are expanding our aerospace logistics services to KSA, Kuwait and Oman and will be offering customers time critical freight and local services solutions. Over time, we have gained momentum through client recommendations. The services we will extend in these new markets includes freight solutions for AOGs, time critical parts from MROs, airlines and part suppliers, overcoming uncertainties and designing custom solutions to respond to the aerospace client’s pain points.
Al-Futtaim Logistics, being part of one of the largest automotive conglomerates in the UAE – Al-Futtaim Automotive, is poised to spearhead this charge into a more interconnected, efficient and sustainable future.
Secure Aerospace Logistics
Dr. Kumar, Al-Futtaim Logistics has recently secured the prestigious ASA-100 accreditation. Can you elaborate on the significance of this achievement?
Securing the ASA-100 accreditation is nothing short of a prestigious moment for Al-Futtaim Logistics. This accolade propels us into an elite echelon, as one of only five 3PL companies globally to hold this esteemed accreditation. It’s not merely a feather in our cap; it’s a resounding affirmation of our unwavering commitment to excellence in freight handling and security standards in aerospace logistics.
Al-Futtaim Logistics’ compliance with ASA-100 standards includes meticulous documentation control to ensure traceability and accountability for all aircraft parts. Rigorous inspections are conducted on inbound and outbound shipments to identify and address any hazardous materials, suspected unapproved parts, or counterfeit components. When such items are detected, Al-Futtaim Logistics swiftly notifies clients and implements quarantine and segregation procedures to maintain safety and quality standards.
How will this accreditation impact your clientele and operational paradigm?
For our customers, it means they can trust us to handle their freight with utmost care and precision, especially when it comes to safety of parts and products. This certification ensures that we meet and exceed industry standards, providing our clients with peace of mind and reliable service. It instills an unprecedented level of confidence in our ability to handle cargo with surgical precision and utmost care. This isn’t just a seal of approval; it’s an ironclad guarantee of reliability and excellence, equipping us to tackle the most formidable logistics challenges.
In what ways does the ASA-100 accreditation align with Al-Futtaim Logistics’ overarching strategy?
The ASA-100 accreditation serves as the cornerstone of our forward-thinking strategy. In the dynamic realm of logistics, stagnation is tantamount to regression. This certification acts as a springboard for perpetual innovation. We are not content with merely maintaining
standards; we are committed to continually raising the bar. Our goal isn’t just to participate in the logistics industry; it’s to reshape its very foundations.
Last Mile E-Commerce
How have customer expectations and logistics evolved in e-commerce over the last five years?
E-commerce has undergone a rapid transformation. What previously took decades to develop now evolves within a few years. If companies fail to adapt swiftly, competitors will overtake them.
Think about how straightforward it is to order items from anywhere in the world and receive them within a week, something that was unimaginable just a few years back. Today, this has become the norm, all thanks to improvements in last-mile logistics.
The global e-commerce companies have set new benchmarks by transitioning from e-commerce to becoming global logistics leaders. Their efficiency in digitization and innovation has become a model for others. At Al-Futtaim Logistics, we have introduced AI-driven solutions that automate document scanning and data extraction, reducing processing time from hours to minutes.
Last-mile delivery has also expanded from ground-based solutions to aerial logistics, showcasing the industry’s readiness to embrace innovation.
What role does collaboration play in shaping the future of the e-commerce industry?
Collaboration is essential for driving innovation in e-commerce. While e-commerce will coexist with traditional courier and logistics businesses, there will be a shift in balance. Traditional methods won’t disappear, as services like urgent shipments and fuel transport remain essential. Instead, the focus should be on fostering healthy competition and leveraging each company’s strengths to propel the industry forward.
Environmentally Conscious 3PL
Could you elaborate on Al-Futtaim Logistics team’s sustainability initiatives?
Sustainability is a cornerstone of our operations, aligning with the UAE’s net-zero emissions goal by 2050 and Al-Futtaim’s internal targets. We address sustainability through controllable and non-controllable factors. For instance, while we rely on shipping partners for fuel emissions, we actively manage our fleet operations.
Our initiatives include transitioning vehicles to biofuels like B5 and B100. The latter uses sustainably sourced raw materials, significantly improving our net-zero score. Additionally, we have incorporated electric vehicles (EVs) and hybrid trucks into our fleet to further reduce emissions. To validate these efforts, we have partnered with Green Freight Asia for sustainability audits. After a rigorous three-year process, we are nearing the highest possible sustainability score. These efforts reflect our commitment to regulatory requirements and actionable sustainability targets.
Digitization
How is digitization transforming the cargo industry?
Digitization is streamlining operations and reducing manual processes in the cargo industry. We at Al-Futtaim Logistics have implemented digital initiatives like Yard Management System for better automotive logistics operations, leading to increased productivity. The adoption of digital technologies has enabled real-time ocean container tracking and improved communication between stakeholders in the supply chain.
Digital solutions are providing better visibility across the supply chain. Freight forwarders can now collect and analyze vast amounts of data about shipments, carriers and markets, leading to better decision-making in pricing, routing and risk management. Al-Futtaim Logistics has deployed new technologies in their systems for contract logistics, general transport and last-mile deliveries, increasing transparency in the entire supply chain.
The industry is moving towards paperless operations, with innovations like the electronic Bill of Lading (e-BoL) reducing administrative burdens, eliminating manual errors and accelerating the documentation process. Digitization is enabling freight forwarders to provide better customer service. Al-Futtaim Logistics’ e-commerce logistics platform offers last-mile delivery, assembly services and shipment tracking, prioritizing customer convenience.
What are the key challenges in the implementation of digitization?
One of the biggest challenges is the lack of standardization across the industry, making it difficult for businesses to exchange information and connect electronically. There is also a lack of integration between different software systems, hindering a complete view of the supply chain.
Implementing digital solutions requires significant investment in time and money, which can be a barrier for small and medium-sized businesses. The industry needs to adapt to and effectively utilize new technologies. This includes training staff and updating existing systems to work with new digital solutions. With increased digitization comes the need for robust cybersecurity measures to protect sensitive data and ensure compliance with privacy regulations.
While digitization presents challenges, Al-Futtaim Logistics is embracing these changes to improve its operations and service offerings. The industry as a whole is moving towards a more digitized future, with the potential for significant improvements in efficiency, visibility and customer satisfaction.
The logistics landscape is undergoing a seismic shift. How is Al-Futtaim Logistics staying ahead of the curve?
The world has significantly changed, especially after COVID, emphasizing the importance of adopting digital solutions. Consumers now demand instant availability of goods, whether essential items or aerospace components, pushing for seamless logistics.
In aviation, supply chain efficiency has become critical. We are not merely adapting to change; we are orchestrating it. Our advanced 5G-compatible tracking systems and AI-driven document processing are revolutionizing our modus operandi. We are transmuting raw data into actionable insights, slashing processing times from hours to mere minutes. This digital metamorphosis isn’t just about enhancing efficiency; it’s about redefining the boundaries of possibility in logistics.
What has been the biggest impact of digitization on your operational ecosystem?
Digitization has impacted us in many ways. First, it has increased operational costs. However, this is offset by improved resource planning and operational efficiency. Integrated systems ensure seamless data flow without manual intervention, streamlining the supply chain for customers and us.
About Aerospace Logistics at Al-Futtaim Logistics
| · Headquartered in the UAE
· Established in 1980 · Airside operations in major UAE airports · 24 x 7 AOG operations · ASA-100 accredited 3PL services · 65+ aerospace network member and 300+ stations · Own aerospace hubs in Saudi Arabia, Kuwait and Oman by 2025 · Centralized aerospace services, with global coverage and dynamic freight, haulage and storage solutions · Technicians Onboard Charters (TOC) · Winner of Emerging Aerospace Logistics award |
For more information on services, please contact contact@aflogistics.com
Amsterdam, Netherlands: Air cargo’s strong seasonal fourth quarter (Q4) appears to have peaked, with tonnages and rates dropping slightly in the second full week of December, including from Asia Pacific origins, according to the latest figures and analysis by WorldACD Market Data.
WorldACD said the figures were based on more than 500,000 weekly transactions, thanks to the addition of four new air cargo airline participants in December to its global database.
Following several weeks of consecutive week-on-week (WoW) rises, average spot rates from Asia-Pacific origins dropped by around -4% in week 50 (9 to 15 December), compared with the previous week, to US$4.57 per kilo.
That fall in prices from Asia-Pacific origins was offset by a +6% rise from North America and a +5% increase from Middle East & South Asia (MESA) origins, together leading to a worldwide -1% WoW dip in spot rates overall.
Nevertheless, compared with last year, average global spot rates in week 50 this year were +16% higher, at $3.20 per kilo, driven by a +60% year-on-year (YoY) rise from MESA, a +14% increase from Asia Pacific, +13% rise from Europe, and +8% rebound from North America origins, plus small increases from Africa and Central & South America (CSA).
Average worldwide contract rates also recorded a small (-1%) WoW decrease, to $2.61 per kilo, generating a similar -1% drop in overall worldwide air cargo prices to $2.78 per kilo, based on a full-market average of spot rates and contract rates – but around +6% higher, YoY.
Demand decrease
With worldwide air cargo capacity stable, WoW, in week 50, as a -1% drop in worldwide freighter capacity was balanced out by a +1% increase in passenger belly capacity, the changes in spot prices broadly reflected variations in demand.
Overall worldwide tonnages fell by -1%, WoW, with a -2% drop in tonnages from Asia-Pacific origins and a -7% fall from MESA origins offset by a +4% tonnage increase from Africa and +2% rise from CSA, boosted by rising seasonal shipments of perishables northbound from those southern hemisphere markets – for example, from Egypt to Europe.
Asia Pacific individual markets
Examining the WoW performance of various key Asia Pacific outbound markets in week 50, individual spot rates from Asia Pacific to the USA, and from China to the USA specifically, edged up slightly higher, WoW, to $6.94 and $6.98 per kilo, respectively.
And compared with last year, Asia Pacific to USA spot rates in week 50 are slightly (+4%) higher, YoY, although China to USA rates are down by -7%, YoY.
Meanwhile, chargeable weight in week 50 from Asia Pacific and China to the USA was down, WoW, by -5% and -4%, respectively. But compared with last year, tonnages from Asia Pacific to the USA are +5% higher, while from China to the USA only slightly higher (+1%).
From Asia Pacific to Europe, all of the big origin markets recorded significant WoW drops in tonnages in week 50, including WoW falls of -10% from Vietnam, -9% from Thailand, -8% from Hong Kong, -6% drops from both China and Japan, and a -4% WoW drop from South Korea.
But compared with last year, volumes from most of those markets are significantly elevated still in week 50 of this year, including a +26% YoY increase from Japan, +23% from China, +19% from Vietnam, and +15% from Hong Kong.
And the picture is similar on the pricing side, including WoW declines in week 50 to Europe from Taiwan (-11%), Japan (-7%), and China (-5%), although spot prices from Hong Kong to Europe remain stable at close to their 2024 high of $6.21 per kilo.
But YoY, spot prices from all those major origin markets to Europe are significantly higher in this year’s week 50, including a +63% YoY rise from Thailand, +40% increase from Taiwan, +28% increase from Vietnam, +25% from Japan, +16% from South Korea, +13% From China, and +7% from Hong Kong.
With United States Postal Service (USPS) as one of its largest customers, United Cargo operates 4,000 flights daily in the US for domestic mails alone and an additional 1,500 flights for international routes. While the majority of its air cargo services are provided to commercial businesses, freight forwarders, logistics firms and national postal services, the company is eyeing a global-connectivity expansion, mainly through Southeast Asia.
By Mohammad Laique Khan
United Cargo, the airfreight division of United Airlines, the largest airline in the world, continues to be the leading US-based air cargo belly-carrier, transporting billions of cargo-ton miles annually to hundreds of global destinations across six continents.
Focusing on quality, innovation and customer satisfaction, the cargo carrier is an industry trailblazer, tranforming air cargo for the better, especially for best value.
Jan Krems, President of United Cargo, shares his insights about the company’s missions, innovations, sustainable and flexible solutions as well as smart technologies that help businesses, communities and economies meet the challenges of today’s more globalized digital world.
Krems is responsible for all aspects of United Cargo’s operations, customer service, sales and marketing activity, revenue management, product quality, and technology solutions. Prior to this position, he was with Air France-KLM-Martinair Cargo for 27 years, climbing up the corporate ladder to reach the role of Vice President Americas, where he was responsible for the company’s operations, customer service and sales in North America, South America, Latin America, Canada and the Caribbean.
Krems is an economics graduate from Utrecht University in the Netherlands with a post-graduate degree in marketing. Under his leadership, United Cargo is eyeing expansion on emerging markets while leading United Airlines’ air cargo division in spearheading a more modernized industry.
Read on the rest of Air Cargo Update’s interview with Krems, the air cargo and logistics expert, who enjoys growing grapes and turning them into wine.
Could you please provide an overview of your role at United Cargo and your key objectives for the company?
I am Jan Krems, President of United Cargo. Over the past three decades, I have had the privilege of working in the dynamic world of air cargo and logistics. My passion has always been about connecting people, businesses, and communities through innovative and reliable supply chain solutions. In my current role, I am responsible for all aspects of United Cargo’s operations, customer service, sales and marketing activity, revenue management, product quality, and technology solutions.
At United Cargo, our primary goal is to be profitable and customer-focused. We are committed to doing the right thing and providing a high-quality product. A major part of our strategy is ensuring that 50% to 55% of our shipments are specialty products. By focusing on specialty products, we create stronger relationships with our customers—because when you offer something unique, customers are less likely to switch for a small price difference.
Quality is a top priority for us. We strive for excellence in everything we do, and the feedback we receive from our customers reflects that commitment. Moreover, safety is equally important in all aspects of our operations. Our ultimate goal is to be the best value cargo carrier in the world. We are already the biggest, and we are focused on maintaining that position while continuing to grow.
The US market has undergone significant changes over the years. What opportunities do you foresee in the coming years?
That’s a big question, and it depends heavily on global developments. For instance, we need to watch what happens politically and economically. I don’t know what direction policies will take once there is change of government in the White House. The state of key shipping routes, such as the Red Sea or the Panama Canal, could also significantly impact ocean freight. Strikes and disruptions in freight logistics are another factor to consider.
As for e-commerce, while I recognize its importance, it’s not our primary focus. With the resources and capacity we currently have—especially on routes like Asia—I prioritize serving existing customers. Their satisfaction globally takes precedence, and only if there’s extra capacity do we accommodate e-commerce in future.
Pharmaceuticals, on the other hand, are a core focus for us. We maintain strong relationships with shippers to better understand their needs and ensure they are aware of what we can offer. However, we don’t deal directly with shippers when it comes to rates and agreements. Instead, we operate through forwarders or triangular agreements. Building strong communication with shippers is still critical because mutual understanding helps us evolve and serve them better.
Growth in the US market is definitely achievable, but it varies regionally. Some months, the East Coast performs better than the West Coast, or the Midwest outpaces the South. There’s untapped potential across all these regions.
Domestically, we also focus on opportunities like e-commerce and partnerships with entities like the United States Postal Service (USPS), which is one of our largest customers. For domestic mail alone, we operate 4,000 flights daily, with an additional 1,500 flights for international routes.
Being the largest airline in the world, our responsibility is to connect all key points globally and fill the gaps effectively to maintain and grow our market position.
What are the key emerging markets for United Cargo?
Asia is definitely a growing market for us. Before the pandemic, we were running about 14 flights a day out of China, but now it’s down to around 14 a week, mostly due to the political tensions between the Chinese and U.S. governments. Hopefully, things will improve soon.
However, we have seen progress in some Asian markets. For example, we are back to flying to Hong Kong four times a week and Taiwan twice a day, and our operations in Korea are also up and running. That said, we are always looking for more capacity.
Other strong markets include Vietnam and Thailand. We are making interline deals with other reputable carriers that share our approach and values, but instead of SPA agreements, these are more about capacity agreements. These agreements allow us to send cargo from those markets to the U.S. and bring shipments to our hubs, like in Japan. We have got 14 flights a day to Japan, and from there, we can route cargo to the US.
As for freighters, we don’t actually own any, but we do lease capacity. For instance, we have a freighter flying between Newark and Tel Aviv for a customer, and another flying from Colombia to Miami and Bogota. We also have a dedicated APA freighter that makes daily trips to Micronesia carrying mail. These flights are scheduled, but again, we lease the freighters, we don’t own them.
Can you elaborate on the recent innovations, products, and solutions United Cargo has introduced to meet the evolving demands of the market and sustain growth in the cargo sector?
United Cargo has been focused on aligning its innovations and solutions with the evolving needs of the market. For example, in pharmaceuticals, we have prioritized having the right infrastructure, such as temperature-controlled facilities at all our airports, specialized containers, and well-trained teams to handle sensitive shipments.
In terms of connectivity, we have been enhancing our direct customer interactions and improving host-to-host capabilities. Our booking platform has significantly advanced, and we are collaborating with platforms like Cargo.One and WebCargo to strengthen our digital presence. Interestingly, we also realized that because we were slower to adopt full digitalization, many of our customers still appreciate the direct, personal interactions we provide.
We handle about 2 million bookings annually. For smaller shipments under 100 kilograms, automation is key to simplifying the process. Pre-allocated bookings make up 25%, while another 25% involves more complex shipments that require personalized attention. This balanced approach ensures efficiency and customer satisfaction.
While we initially lagged in digitalization, I have come to realize it gave us the opportunity to refine our strategy, adapt thoughtfully and align our approach with what our customers really value.
Among all verticals, which would you consider the most effective or strategic to focus on?
For us, the pharmaceutical vertical stands out. It’s where we excel and lead by a significant margin. When we engage with our customers—like Pfizer, for example, which is a major partner of ours—we focus on building and maintaining strong, collaborative relationships. In this case, we work closely with our forwarders to ensure seamless operations and mutual satisfaction.
This partnership with Pfizer is more than just a business transaction; it’s a long-term alliance built on trust and mutual dependency. Neither of us can simply walk away—it’s a synergy that’s designed to thrive over time.
Could you share your achievements in digitalization so far? Additionally, how do you envision progressing toward your goals in this area?
We have made some solid progress in 2024 and plan to build on that momentum in 2025. That said, we are mindful of our limited resources, so our pace has to be measured, and we can’t take on everything at once.
Our team has been doing a fantastic job ensuring we stay on track with our digitalization efforts. While we are not leading the field just yet, we are focused on making thoughtful, strategic decisions that align with what’s feasible for us. It’s about finding the right balance and seeing what works best given our current capacity.
With such a wide range of verticals and significant cargo volumes, how do you collaborate with airports and logistics partners to address infrastructure challenges?
Collaboration is a key focus for us. We have strong partnerships with our joint venture allies, like ANA— though their merger with NCA has temporarily put some initiatives on hold. Similarly, with Lufthansa, we seek opportunities to align operations. Recently, we have been working very closely with Emirates, particularly in the pharmaceutical segment, identifying ways to combine our strengths effectively.
Beyond airlines, we actively partner with all stakeholders at airports. This includes trucking firms, handling providers, sales teams, and other key players. Our approach ensures that all parts of the supply chain are interconnected and operate as one integrated system to avoid any gaps or disconnects.
Could you share the sustainability initiatives undertaken by United Cargo?
Sustainability is at the heart of United Cargo’s operations. Our focus on initiatives like Sustainable Aviation Fuel (SAF) reflects our commitment to reducing carbon emissions in a meaningful way.
For our CEO, sustainability isn’t just a buzzword or a marketing tactic—it’s a fundamental part of how we operate. He truly believes in leading the charge to make United Cargo a carbon-neutral organization. While many companies set ambitious goals for the future, we focus on practical, collaborative actions that involve every part of the logistics chain. It’s not just about airlines or forwarders; everyone has a role to play in creating a cleaner, more sustainable world.
At United Cargo, sustainability is more than a program; it’s a value we embody. With genuine dedication, we work tirelessly to advance these initiatives, not as a promotional tool, but as a heartfelt commitment to creating a cleaner, better future.
How do you collaborate with stakeholders to ensure adherence to regulatory and safety standards across all operations worldwide?
We have dedicated teams focused solely on safety, compliance, and our safety management system (SMS). Regular interactions with regulatory bodies like the FAA and DOT are a key part of this process. In fact, sometimes we have more team members dedicated to safety and compliance than we do to sales. It’s a daily commitment for us. Within United Cargo, entire teams are tasked with ensuring we stay on track with all safety and regulatory requirements. We maintain ongoing discussions with these authorities to make sure we are always doing the right thing.
What do you see as the most significant opportunities and challenges facing the air cargo industry in the coming years, and how is United Cargo preparing to address them?
The air cargo industry faces numerous challenges and opportunities, and staying ahead requires a firm focus on maintaining quality and adapting to global dynamics. For instance, geopolitical issues, such as restrictions on flight paths—like the inability to fly over Russia en route to India—add significant costs to operations.
Environmental concerns, such as the impact of global warming, are another pressing issue. Additionally, trade policies, including tariffs introduced during past administrations, continue to influence global logistics.
A long-standing challenge within the industry is addressing inefficiencies in booking systems. It’s perplexing that customers can book shipments and fail to show up without financial consequences. This has been an unresolved issue for years. Attempts to address this in previous roles faced pushback because not everyone in the industry was willing to adopt such policies, leaving us isolated in our approach.
Despite these challenges, United Cargo is in a strong position. The company is highly supportive of its cargo division, granting us the flexibility to innovate and pursue new strategies. This collaborative environment makes me optimistic about the future and confident in our ability to navigate the evolving landscape of the air cargo industry.
Could you share some insights into United Cargo’s upcoming plans or initiatives that particularly excite you?
We are expecting a new plane every three days over the next six years, which is incredibly exciting for us. Although there were some setbacks with the strikes and issues at Boeing, those are behind us now, so things should improve going forward.
We will be adding a lot of 737 Maxes, Airbus A321 Neos, and Boeing 787s to our fleet. From a cargo perspective, this is fantastic news. United Cargo is determined to be not only the biggest but the best, and especially the best. We are deeply customer-focused, with a strong emphasis on safety and service. It’s truly a pleasure to be part of a company that’s so dedicated to its customers, both in passenger and cargo services.
How do you view the Middle East market? While you currently don’t have regular flights to the region, you do operate some services—could you elaborate on your experience?
Yes, we do operate flights to Dubai, though it’s more of a one-off situation—we have flown there three times so far in the past. Then, of course, COVID hit, and everything changed. Despite that, I’m happy to report that we are currently performing about 40% better than before the pandemic – which is something not many airlines can claim.
As for the Middle East market, we have been keeping an eye on it. Unfortunately, there’s been some unrest in the region, so we had to make adjustments. For example, we were flying to Amman, but then had to cancel those flights. We also used to fly three times a day to Tel Aviv, but we had to stop those due to the unrest.
We are definitely keen to return to Dubai, ideally with three daily flights, but we will need to assess the situation before making any decisions. Ultimately, we are excited about the potential to elevate Dubai’s connection with the Middle East, and we are really eager to work closely with Emirates to explore how we can develop a stronger, more impactful partnership.
While there’s a significant focus on the growing Southeast Asian market, how do you view the potential of the African market?
Yes, we are also focusing on the African market. We already fly to various destinations there, and we are looking to expand further with more routes. However, it’s often more passenger-driven than cargo, so we are constantly looking for ways to balance that.
That being said, I believe Africa will see more growth in the future. As we continue to increase our capacity and get the planes we need, we will be able to scale up. It may take some time, but Africa is definitely a key part of our growth strategy moving forward.
Geneva, Switzerland: The International Air Transport Association (IATA) says the total global air cargo demand, measured in cargo ton-kilometers (CTKs), rose by 9.8% compared to October 2023 levels (10.3% for international operations) for a 15th consecutive month of growth.
The rising demand was complemented by a drop in fuel costs, generating more profits for the air cargo industry. “Air cargo profits grow as fuel costs continue to drop. In October, average global jet fuel prices rose by 4.4% from the previous month, marking the first increase in three months. On the other hand, in YoY terms, they dropped by 25.7% YoY, the fifth consecutive decrease, settling at USD 89.8 per barrel on October 31,” IATA noted.
IATA, which represents 330 airlines, comprising over 80% of global air traffic, said capacity, measured in available cargo ton-kilometers (ACTKs), increased by 5.9% compared to October 2023 (7.2% for international operations), largely driven by an 8.5% increase in international belly capacity. Dedicated freighter capacity increased by 5.6%, the seventh consecutive month of growth with volumes nearing 2021 peak levels.
“Air cargo markets continued their strong performance in October, with demand rising 9.8% year-on-year and capacity up 5.9%. Global air cargo yields (including surcharges) continue to rise, up 10.6% on 2023 and 49% on 2019 levels. While 2024 is shaping up to be a banner year for air cargo, we must look to 2025 with some caution. The incoming Trump Administration’s announced intention to impose significant tariffs on its top trading partners—Canada, China and Mexico—has the potential to upend global supply chains and undermine consumer confidence. The air cargo industry’s proven adaptability to rapidly evolving geopolitical and economic situations is likely to be tested as the Trump agenda unfolds,” said Willie Walsh, IATA’s Director General.
Several factors in the operating environment should be noted:
October Regional Performance
Asia-Pacific airlines saw 13.4% year-on-year demand growth for air cargo in October. Capacity increased by 9.3% year-on-year.
North American carriers saw 9.5% year-on-year demand growth for air cargo in October. Capacity increased by 5.8% year-on-year.
European carriers saw 7.6% year-on-year demand growth for air cargo in October. Capacity increased 3.9% year-on-year.
Middle Eastern carriers saw 4.5% year-on-year demand growth for air cargo in October. Capacity increased 0.8% year-on-year.
Latin American carriers saw 18.5% year-on-year demand growth for air cargo in October, the strongest growth among the regions. Capacity increased 5.8% year-on-year.
African airlines saw 1.6% year-on-year demand growth for air cargo in October, the slowest among regions. Capacity increased by 7.7% year-on-year.
Trade Lane Growth: International routes experienced exceptional traffic levels for the fifth consecutive month with a 10.3% year-on-year increase in October. Airlines are benefiting from rising e-commerce demand in the US and Europe amid ongoing capacity limits in ocean shipping.
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