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The air freight services market size is forecast to increase by USD 53.99 billion, at a CAGR of 4.32% between 2023 and 2028. Market growth hinges on multiple factors such as the escalating demand driven by the surge in cross-border e-commerce activities, bolstered by the convenience and accessibility of online shopping. Additionally, the rapid expansion of aviation infrastructure contributes to increased cargo handling capacities, meeting the escalating demand for efficient logistics solutions. Moreover, rising investments from air freight operators in acquiring new aircraft further enhance the capabilities of the air freight industry, fostering its growth trajectory. The report provides market size, historical data spanning from 2018-2022, and future projections, all presented in terms of value in USD billion for each of the mentioned segments.
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The market plays a vital role in the logistics industry, particularly for time-sensitive shipments like vaccines requiring cool-chain systems. With advancements in robotics, artificial intelligence (AI), and big data, the industry is evolving rapidly. IoT (Internet of Things) and augmented reality are enhancing efficiency in air cargo industry, facilitating real-time tracking and streamlined operations. Despite challenges such as fluctuating oil prices and refinery capacity, freighter flights remain crucial for maintaining high-speed shipments. Central Airlines and digital air cargo marketplaces are transforming aircraft operations with innovations in AI, big data, deep learning, IoT, and augmented reality. Our researchers analyzed the data with 2023 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
Increasing cargo handling capacities due to rapidly growing aviation infrastructure is the key factor driving the market. Air freight services require safe, functional, and affordable airport infrastructure. Global investment in commercial aviation infrastructure continues to grow as several regional airports are being developed, and existing airports are expanding to increase cargo handling capacities. This also leads to increasing air connectivity between cities and high-speed shipments.
Additionally, as air commute is much faster than other modes of transportation, a large number of e-commerce companies and mail and courier service providers prefer air freight over land or rail transportation. Many airports and government authorities focus on major airport development projects across the globe and seek to ensure that they result in adequate infrastructure for airlines. Thus, improving commercial aviation infrastructure with IoT, and big data is likely to boost the capacities of airports across the globe, which will fuel market growth during the forecast period.
The emergence of digitalization is the primary trend shaping the market. Air freight offers cross-border trade, which becomes critical for express delivery, long-distance, and efficient transportation of sensitive and critical goods. End-users such as e-commerce companies and manufacturers, use air freight to reduce the time constraints associated with the other modes of transportation. Moreover, the market still relies on paper-based processes to exchange shipment information along the complex supply chain. The lack of data integration and standardization results in inefficiencies in the supply chain limits the end-to-end visibility, and increases the chances of error.
Moreover, digitalization plays a major role in the development of innovative services and solutions, which will increase the efficiency of the ecosystem and deliver incremental value to the end customers. The air freight business boomed during the pandemic with skyrocketing demand for goods and the expanding e-commerce sector. Further, the primary objectives of automation of the air freight industry are enhanced customer experience, online services, transparency of data, and a sustainable future for the market.
The presence of inadequate airport infrastructure, congestion, and antiquated facilities is the major challenge that affects the market expansion. Congestion becomes a common issue in areas where airports lack the necessary infrastructure to manage the increasing volume of air cargo, resulting in delays in cargo processing and aircraft turnaround. Furthermore, outmoded buildings and equipment can cause operational inefficiencies and longer handling times, compounding congestion-related delays. These challenges affect the timely delivery of goods and raise operating expenses due to longer ground delays and limited operational flexibility.
Furthermore, airport congestion and inefficiency can cause missed connections and scheduling interruptions, reducing reliability and competitiveness. To overcome these difficulties, investments in airport infrastructure upgrades and modernization efforts are critical for increasing capacity, streamlining operations, and improving overall efficiency in air cargo handling. Furthermore, collaboration among governments, airport authorities, and industry players is required to develop strategic solutions and address congestion-related concerns in the market. Thus, such factors can restrict market growth during the forecast period.
The market forecasting report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their market growth analysis strategies.
Customer Landscape
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
The market research and growth report also includes detailed analyses of the competitive landscape of the market and information about 23 market companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The international segment is estimated to witness significant growth during the forecast period. Companies are growing their global reach, needing efficient and dependable to carry goods between continents. Furthermore, technological advances and logistics management systems have increased the efficiency and dependability of international services. Real-time tracking, better route planning, and automated customs clearing processes have cut transit times while improving overall service quality, making air freight the preferable option for time-sensitive cargo.
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The international segment was the largest segment and was valued at USD 121.35 billion in 2018. Further, the e-commerce boom is another important reason fueling the rise of the international segment. With the advent of online retail platforms, there is an increasing demand for fast delivery of goods to customers all over the world, necessitating the use of efficient international air cargo services. Companies that benefit from this trend include global logistics leading firms, which have large networks and the capacity to handle international air freight shipments efficiently. As a result, the adoption is expected to drive the growth of the international type segment, which, in turn, is expected to drive market growth during the forecast period.
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APAC is estimated to contribute 41% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period. The market in APAC is growing because of the rising e-commerce industry in countries such as China, India, and Japan. E-commerce is increasing, and its growth is fueled due to the pandemic and is growing daily as it provides speed and convenience. The promising growth potential of e-commerce logistics will help drive the growth of the regional market.
Additionally, the production of various goods is shifting to Southeast Asia due to the rising costs of manufacturing in China and concerns related to volatile trade relations between the US and China. Owing to these factors, there have been significant investments and initiatives in Southeast Asian countries to promote air freight services. Some of the major vendors operating in the market in APAC are focusing on expanding in the region owing to the opportunities that it offers.
The market report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2018 to 2028.
The market is a vital component of global commerce, facilitating the swift and efficient transport of valuable goods such as jewelry, pharmaceuticals, and high-end electronics. With consolidated air freight services and door-to-door delivery, it ensures seamless global supply chains for both perishable and non-perishable goods. Rising fuel costs drive innovation towards fuel-efficient aircraft and alternative fuels, enhancing sustainability. Freight forwarders utilize platforms like WebCargo to optimize operations, serving diverse sectors including apparel, automobile components, and agricultural products like fruits, vegetables, and meats.
Further, in the dynamic market, technological advancements like virtual reality streamline operations while ensuring security of shipments, especially for electronic goods. With domestic air freight and door-to-door service, businesses benefit from efficient pickup and delivery options. Factors such as fuel prices and shipping costs influence the market's trajectory, impacting air carriers and cargo planes. Robust airport-to-airport connections and marine routes enhance global connectivity, while air freight insurance mitigates risks. Online platforms optimize processes, utilizing CTKs to measure performance amidst fluctuating aviation fuel prices and optimizing airport's usable space for enhanced efficiency.
Market Scope |
|
Report Coverage |
Details |
Page number |
166 |
Base year |
2023 |
Historic period |
2018-2022 |
Forecast period |
2024-2028 |
Growth momentum & CAGR |
Accelerate at a CAGR of 4.32% |
Market Growth 2024-2028 |
USD 53.99 billion |
Market structure |
Fragmented |
YoY growth 2023-2024(%) |
4.26 |
Regional analysis |
APAC, North America, Europe, Middle East and Africa, and South America |
Performing market contribution |
APAC at 41% |
Key countries |
US, United Arab Emirates, China, Japan, and Germany |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
Agility Public Warehousing Co. K.S.C.P, Air France KLM SA, AIT Worldwide Logistics Inc., Amazon.com Inc., American Global Logistics, AP Moller Maersk AS, Blue Dart Express Ltd., Bollore Logistics, C H Robinson Worldwide Inc., Cargolux Airlines International SA, Crane Worldwide Logistics, DACHSER SE, DB Schenker, Deutsche Bahn AG, Dimerco, DSV AS, Expeditors International of Washington Inc., FedEx Corp., GEODIS, JD.com Inc., PSA International Pte Ltd., United Parcel Service Inc., and Volga-Dnepr |
Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, and market condition analysis for the forecast period. |
Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
We can help! Our analysts can customize this market research report to meet your requirements.
1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Type
7 Market Segmentation by End-user
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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