Air Transport World

Cargo forecast 1984: business good and getting better.

Almost everyone in the air cargo industry is sure business is good and getting better every day. The reaction from airlines and forwarders alike at a recent industry gathering was practically 100% positive. The ending of the recession in the U.S. and the easing of it elsewhere in the world were producing growth figures in both the third and fourth quarters of 1983 and projections of reasonable growth this year.

What is less certain is the structure of a traditionally plodding business that has never realized its potential--and has never had a better opportunity to do so.

Says Michael Walker, transportation analyst with Alex. Brown & Sons of Baltimore, Md., "The typical product, both industrial and consumer, is becoming smaller and of higher value and, obviously, that high value-to-density ratio leans toward air freight."

Moreover, he continues, if U.S. industry continues to apply the so-called "just-in-time" theory of inventory management, he foresees a greater need for air freight, as inventories are turned over faster to reduce holding costs, and air transport is used instead of a warehouse.

For years air cargo (freight and mail) limped along in the U.S., regulated by the Civil Aeronautics Board in such a way as to underwrite the passenger business. But, in 1977, air cargo was deregulated; in 1980, trucking regulation was loosened. …

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