Now that the green shoots of global economic recovery have undeniably taken root – ever so tenderly, but rooted none-the-less – the air cargo industry should begin to think about what the future industry will look like. Things will never be quite the same after coming through what pretty much amounts to a proverbial ‘baptism of fire’.

The sheer speed and intensity of the air freight market crash stunned even hardened veterans and leaves many companies still reeling in its wake. That the industry now cheers because FTKs are only down 10-15 per cent year-on-year instead of down 20 per cent or more only months ago, pretty much sums it up.

It leads one to ponder what the industry will look like down the road. Will large dedicated freighters shrink in importance as ‘safer’ belly capacity becomes a more viable option, or perhaps smaller to medium sized freighters will replace the behemoths. Airbus and Boeing of course have their vested views on this.

And will carriers become reluctant to own capacity, or perhaps rely more on sale and lease-back type arrangements. Perhaps an altogether new model will emerge, as was suggested by one speaker at the IATA cargo conference in Bangkok earlier this year, in which cargo carriers outsource their entire cargo capacity, thus shedding much of the risk. Or, maybe the business model needs expanding, effectively taking a leaf out of the integrators’ book, to go beyond simply transporting goods from one airport to another.

One thing is clear, flexibility, discipline and efficiency – not only in business but of aircraft and equipment – will all be paramount. Getting caught with a fleet of big old aircraft when the bottom drops out of the market like a rock from space, hurts and indeed more than a few cargo carriers were bashed in that manner, some even fatally.

And of course, the million dollar question: Has the industry learned anything about capacity management from this crisis. Most agree if there was one thing that carriers could have done much better, it was pulling more capacity out of the market, faster.

But for now, the immediate problem of course, is getting the historically low rates back up to a sustainable level. Vocal and some may argue provocative attempts to unilaterally raise rates by some of the major cargo groups like Air France KLM and Lufthansa have raised the hackles of shippers. But in the interest of not merely the survival of the carriers, but the overall health of the industry, there are scant alternatives.

Undoubtably, major portions of this bold move will be subverted by ‘special’ discounts and back room deals for major shippers. Among those in the industry that have spoken out against such undercutting is Julian Keeling of Consolidators International, who believes 2010 will see a continuation of what he calls the “jungle” atmosphere in which air freight now operates.

“As a 40-year professional in the business, it is indeed sad this great industry utilising the newest aircraft and the most advanced technology cannot earn a decent profit on its unequalled ability to move merchandise of every size, type and description across oceans and continents in less than 24 hours,” he lamented.

In Keeling’s words, the industry must now make a “supreme effort” to find new customers for air and generate increased business from existing shippers. “How long can we generate only four per cent of the total transportation pie and remain a viable industry?” he asks.

While globalisation will surely continue to drive growth in the air freight industry, it seems an advantageous time to really begin exploring potential new business models for an industry that perpetually seems to rollercoaster its way along.