IAG Cargo reveals global vehicle manufacturing sector to be recovering

Published: Sunday, March 7, 2021

AIRFREIGHT specialist airline IAG Cargo says the global vehicle manufacturing sector is now in recovery, even though car sales around the world plummeted during the pandemic 2020 year.

The carrier reveals it has transported more than 8,000 tons of automotive spare parts shipments since the beginning of this year, writes Thelma Etim.

Freddie Overton, regional commercial manager for Europe and Africa at the airfreight division of International Airlines Group (IAG), reveals: “We’ve seen an increase in requests to charter our aircraft to transport automotive parts across the world.”

Since airfreight is ideally suited to the automotive industry’s just-in-time manufacturing processes, many of the consignments – which include engines, pistons, doors and tyre rubber – were shipped utilizing the airline group’s Boeing 777s and B787 Dreamliner passenger aircraft on 95 special charter flights arranged by the carrier’s dedicated cargo charter team, which was formed in response to the start of the pandemic.

The most popular car-parts routes currently include Germany to South Africa, Mexico to the United Kingdom and south-east Asia to the United States.

The IAG news follows a report from the Economist Intelligence Unit, published in October 2020, which predicted double-digit growth in global vehicle sales this year. Last September, Moody’s Investors Service also predicted that sales of vehicles are expected to “climb steeply” over the next 12 to 18 months.

“The stable outlook for the global automotive industry reflects rising sales throughout 2021 with continued, but slow, increases through 2023,” observes Bruce Clark, a Moody’s senior vice-president. “Nevertheless, auto shipments won’t recover to pre-pandemic levels until the middle of the decade,” he warns.

Online publication ING’s THINK Economic and Financial Analysis – which is made up of a group of 40 prominent economists – also cites the ratings agency’s prediction of a 16-17 per cent drop in aggregate organic revenues of European auto parts suppliers last year – “followed by a rebound of 11 to 12 and nine to 10 per cent in 2021 and 2022 respectively,” it predicts.

IAG cargo’s Overton observes: “The use of airfreight in the automotive industry continues to grow and, given the need to operate on a just-in-time basis, only air cargo can transport such time-critical spare parts to their destinations in hours rather than weeks.

“In addition to our charter services, our customers benefit from our ‘critical’ services – so whether it’s a last-minute order or emergency replacement equipment we can support them to move [their] critical shipments across the globe via our extensive network,” he insists.