Southeast Asia is set to play a pivotal role in the growth of the airfreight industry and its move towards a more sustainable vision, according to insights from Boeing and its World Air Cargo Market Forecast (WACF).
e-commerce boost powers cargo carriers
One of the standout trends highlighted by Boeing is the robust growth of e-commerce in Southeast Asia. The region experienced a remarkable 16.1% year-over-year increase in e-commerce sales revenue in 2022, and this upward trajectory is predicted to continue, with forecasts indicating it will reach a staggering $206 billion by 2025.
The surge in online shopping, combined with evolving supply chain dynamics and the entry of new cargo carriers into the market, has driven a surge in demand for dedicated freighters to meet the needs of e-commerce logistics.
Notably, the number of standard-body freighters operating in the region, such as the Boeing 737-800 Converted Freighter, has more than doubled from 21 aeroplanes in January 2020 to 45 in August 2023.
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Regional evolution
Boeing’s report also highlights the evolving landscape of supply chains in the wake of the pandemic. Manufacturers and logistics firms are increasingly diversifying their supply chains, with a focus on reducing costs while enhancing reliability and resilience.
Geographical diversification has emerged as a key strategy for manufacturers, and the report indicates substantial growth in air export volumes from manufacturing centres in several Southeast Asian countries.
Notable beneficiaries of these evolving supply chain strategies include Malaysia, Vietnam, and Thailand, which have seen cargo tonnes to the U.S. increase by 101%, 84%, and 79%, respectively, from 2017 to 2022.
Sustainability in the spotlight
Boeing’s sustainability report shows the pressing need for sustainability in aviation and has outlined four strategic pathways to reduce emissions: fleet renewal, operational efficiency, renewable energy, and advanced technologies.
The introduction of new aircraft generations offers substantial efficiency gains, with each new iteration reducing fuel consumption and emissions by 15-25%.
The upcoming 777-8 Freighter, for instance, promises to be a game-changer, featuring advanced technology from the new 777X and the proven performance of the 777 Freighter, resulting in the highest payload and lowest fuel use, emissions, and operating cost per tonne of any large freighter in service.
Furthermore, Boeing highlights the significance of freighter conversion programmes, which provide airlines with an economical means to extend the serviceable life of commercial aircraft while replacing older-generation freighters.
For instance, the fuel-efficient 737-800BCF boasts up to 20% lower fuel use and CO2 emissions per tonne compared to its predecessor.
Boeing is putting itself at the forefront of Sustainable Aviation Fuel (SAF) adoption, recognising it as the primary avenue for reducing emissions over the next three decades. Boeing’s commitment includes developing SAF capabilities to ensure their commercial aeroplanes are 100% SAF compatible by 2030, using SAF for their own operations, and fostering global industry partnerships and policy advocacy to scale up SAF production.
In a significant move towards sustainable aviation, Boeing, in collaboration with the Roundtable on Sustainable Biomaterials (RSB), initiated a joint study in June 2023 to scale sustainable aviation fuel (SAF) production in Southeast Asia.
SAF has the potential to reduce carbon emissions by up to 85% over its life cycle. The study, set to unfold in phases, will evaluate the feasibility and sustainability of SAF production in Southeast Asia, with findings and recommendations slated for publication in the first quarter of 2024.
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Asia’s advantage
Boeing’s insights underscored Singapore’s pivotal role in the aviation and logistics industry. Singapore, one of the world’s most connected nations, is strategically located along major trade routes, connecting over 600 ports.
The country is home to more than 100 airlines serving around 100 countries and territories worldwide. At Singapore’s Changi Airport, an impressive 1.9 million tonnes of cargo is handled annually, ranking it 16th globally and making it Southeast Asia’s largest air cargo hub.
