This year, cargo volumes are expected to decline as aggregate demand, constrained by rising inflation, squeezes consumers’ pockets. As a result, cargo volumes have diminished for many airlines and airports. However, we may be at an inflection point. The International Monetary Fund (IMF) suggests that global growth will slow from 3.4 percent in 2022 to 2.9 percent in 2023, then rebound to 3.1 percent in 2024.
This prognosis makes sense for two reasons. The first is that inflation has slowed annually for the last six months, dipping to 6.5 percent after peaking at about 9 percent last summer (2022), partly as gas has become more inexpensive. The other point is that China’s sudden re-opening paves the way for a rapid rebound in transnational activity. Of course, China’s resurgence in global trade (goods and services, like tourism) could mean more pressure on energy prices and, thus, more inflationary pressures. However, the demand will not cause the inflation levels we witnessed during 2021-22.
Prepare To Capture The Gain From The Upturns In Economic Cycles
But I am meandering because I declare that downturns are the best time to invest in upturns. The downturn means your construction and preparation would interfere less with striving ground handlers and airlines during the boom years. It also means early preppers benefit first and most when the economy is up because their airports, or seaports, had the foresight to develop facilities ready to meet emerging demand.
Just as the time to buy stocks is when stock prices are plummeting, it is the best time to build and expand cargo facilities during a downturn in demand. That was always my philosophy when I headed cargo development at Atlanta Airport (see an interview where I discussed such approaches to cargo development). Today, they benefit from that strategy, while other airports follow a similar path.
SASI World Is Here To Facilitate Your Growth Strategy
As many of you know, I partner with world-renowned consultants on developing logistic efficiencies and growth for cargo facilities, strategy, air service, and staff training for airports, seaports, and airlines globally.
If you are ready to lead your air or seaport to new growth and success for logistics, contact us to start a discussion on how best to do this. As an insider, I know investors ready to expand and facilitate this growth with state-of-the-art facilities and partnerships in port cargo community systems that can streamline your cargo flow and improve revenue collection.
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