Global supply chain disruption, what does this mean for peak season demand?

Monday, October 11, 2021

The end-of-year peak season for air cargo is notorious for higher rates and capacity reduction as the supply and demand balance shifts. As we enter this year’s peak season quarter, there are concerns for many industries on fulfilling orders in the lead-up to Christmas. With ongoing issues with freight operations in Southeast Asian countries, coupled with the instability of sea freight, as well as the shortages of HGV drivers in additional to global complexities (Brexit in the UK, etc), the market is already experiencing severe disruption across land, air, and sea.

Here, we go over  the ongoing global supply chain issues and what effect this will have on industries in the lead-up to Christmas.

What are the issues with global supply chain capacity?Sea freight is experiencing significant delays in shipping. Key to global trade, sea freight continues to run beyond maximum capacity. With a short supply of available containers and issues with backlogs at major ports, costs for sea freight are at their highest. Add to that a shortage in HGV drivers and continuing high demand from consumers, capacity in trucking is tightening which is further exacerbating the supply chain issues. Trucking is a critical link in the chain, and the driver shortage coupled with quarantine rules for returning truckers is adding to an already pressurized logistics industry.

As a result of these extra demands placed on the supply chains, we are already seeing enquiries for air freight increase to meet the demand for orders typically fulfilled via sea or road transportation. The air cargo market however is facing its own challenges, with Covid-related disruptions and increase in demand having a big impact on air cargo capacity and pushing up rates to some of their highest levels since the pandemic.

What industries are likely to be most affected by the supply chain issues?

The knock-on effect of supply chains means this is a global issue disrupting many industries. We’ve provided support and effective solutions to a wide range of new clients and, in light of recent supply chain disruption, have seen a growing number of enquiries from retailers who would not typically use air charter. The strict Covid quarantine rules introduced in Southeast Asia has caused disruption to manufacturing, and many buyers are turning to air freight to transport their products to reduce the lead time it takes to get the stock to market. We expect to be busier than ever as enquiries increase for the charter of toys, as well as high-value items such as designer clothes, games consoles, mobile phones and laptops.

When will capacity issues be back to normal?

The demands the global logistics industry are seeing shows no let-up or return to normal anytime soon. The lead up to the Christmas period and peak season availability in the air freight industry always sees a shift in demand versus capacity. As long as consumer demand continues throughout the holiday season, and until container circulation improves and trucking shortages are alleviated, we will continue to see disruption and capacity issues persist.

Why choose air over land or sea?

Air freight offers a faster, safer and more reliable option compared to other transportation options. The biggest advantage gained when shipping cargo via air is the speed at which goods can be delivered, sometimes as fast as same-day delivery. With the cost of sea freight rising, and instability on capacity and delays in delivery, coupled with the shortages of land transportation, air freight offers the fastest shipping times, as well as reliable arrival and departure times.

What are the benefits of using with Air Partner?At Air Partner, we understand the logistical challenges and demands major retailers face in the lead-up to Christmas and expect to see an increase in demand for dedicated cargo flights from major retailers seeking to minimize disruption to their global supply chains and continue serving their customers.

As the landscape for essential business and trade around the globe continues to change, transporting essential cargo via air charter has quickly become the clear choice for many organizations and global businesses. Dedicated air charter offers advantageous opportunities for industries to move goods quickly, reliably, flexibly and securely. We can provide unique capabilities and full-charter or part-charter services as an ongoing solution to transport all sizes of cargo. We have access to more aircraft options suited for different cargo types and sizes, and we can tailor flights and flight programs based on your specific needs while seeing projects through from start to finish.

We are audited ourselves to the ISO:9001:2015 standard, demonstrating our commitment to service quality and customer satisfaction by continuously improving quality management systems. As well as being publicly listed on the London Stock Exchange, we have the financial strength to deal with the most challenging aviation requests.

In a time where finding capacity during the height of peak season is a somewhat tricky process, our 60 years of experience and global industry relationships means we are best placed to source aircraft solutions for your needs. Our freight team are highly experienced and are available 24/7/365, taking care of the entire logistical process to ensure a smooth operation.

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