Air Freight Forwarding Market

Global Air Freight Forwarding Market Size & Growth (2022 - 2027)

The global air freight forwarding market has the potential to grow 7.81 million tons between 2022 - 2027 and is expected to grow steadily with a CAGR of over 4% during the foreseen period.

The growth of international trade volumes is an important factor for the freight transport market. Besides, the increase in trade agreements between countries is also helping in the growth of the market. Rising demand for perishable cargo transportation and life science/healthcare industry is also expected to drive the market growth during the foreseen period.

Freight forwarding is a process of organizing shipments for companies or individuals in order to transfer the goods from one point to another, that is, the final point of distribution. A carrier can use various shipping methods to transfer these products, such as airplanes, railroads, trucks, ships, and others. When the process involves the use of planes to transfer these shipments, it is referred to as air freight forwarding. With the increasing need for fast transit, the market for air freight forwarding has witness huge spike lately across the planet.

The global air freight transport market experienced a contraction in 2019 for the first time since the financial crisis. The slowdown in the global economy and world trade has affected the air freight forwarding industry. According to industry estimates, the situation is expected to continue until 2021.

With the increase in the number of small and medium-sized enterprises (SMEs), air freight transport companies are looking to develop their activities with SMEs. Online freight booking and booking platforms offer SMEs the opportunity to expand into international markets, as these platforms have a large number of connections compared to their traditional (physical) counterparts. Since the freight industry is not asset-based, the industry faces stiff competition from other supply chain players and tech companies disrupting the freight market.

COVID-19 Impact on Air Freight Forwarding Market

The COVID-19 outbreak has greatly affected the market. The economic crisis caused by the blockade severely hampered international transport. The virus outbreak and the inability of developed and developing countries to control the spread of the virus have disrupted the production cycle and the supply chain. This obviously hampered the air freight forwarding market.

Demand for air travel has declined as personal protective equipment (PPE) is no longer urgently needed. Additionally, retail freight is not yet in the air as shippers prefer ocean or rail freight to air freight. However, air travel would benefit when the right situation arises or when a suitable vaccine is approved.

Market Growth and Trends

With the increase in global merchandise trade, air logistics has grown steadily, stimulating the market for air freight forwarding. Asia was by far the largest trading region. In 2018, the business through aircraft in this area has increased with a tremendous rate. The other continents recorded less than half of these amounts.

Since transport companies focus on cost reduction, they are looking to acquire or invest in air freight forwarding. This increases competition and also affects established freight forwarding companies to some extent.

Market Drivers and Restraints:

Key factors driving air freight forwarding market growth are high demand for low-cost shipping, the ability to identify customer needs, and respond quickly with logistics solutions. Trends such as high demand for integrated services further drive business growth. Freight forwarders typically provide customers with a wide range of integrated services, including not only the regular transportation of goods from origin to destination, but also a number of other services. Also, the increase in trade agreements between nations also helps increase market growth. However, increased relocation and near-routing of manufacturing is hampering market growth. Regardless of the challenges, the growing trend of intermodal freight transport will further drive market growth in the coming years.

GLOBAL AIR FREIGHT FORWARDING MARKET REPORT COVERAGE:

Market Segmentation:

The global air freight forwarding market is segmented and sub-segmented as follows:

Air Freight Forwarding Market - By Service:

• Packaging
• Documentation
• Transportation & Warehousing
• VAS (Value-added services)

Regional Analysis

Geographically, the air freight forwarding market has been analyzed in

• North America
• Europe
• Asia-Pacific
• LAMEA

The global logistics industry is going through uncertain times due to COVID-19. The Asia-Pacific market is one of the few regions that continues to grow despite the pandemic. For the transportation and logistics market, Asia-Pacific is the fastest growing region in the world. This is due to the growing logistics in ASEAN countries and the presence of large economies such as China and India. Furthermore, the high government support for the logistics sector in the region is also a factor that stimulates the growth of the industry. China is the largest manufacturer in the region and the world, with a growing demand for pharmaceuticals and commodities, China has reopened factories much earlier than other countries. China is the world's largest freight transit market.

Almost 68% of the market growth will come from APAC during the foreseen period. China and Japan are the main markets for air cargo transportation in the APAC region. Market growth in this region will be faster than business growth in other regions.

Key Market Players

Some of the major players in the global air freight forwarding market are Kuehne + Nagel International AG, Deutsche Post DHL Group, DB Schenker, Nippon Express Co., Ltd., DSV A/S, UPS Supply Chain Solutions Inc., Expeditors International, Sinotrans Limited, The Panalpina Group and Hellmann Worldwide Logistics, among others.