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VietNamNews

Airfreight needs makeover

Update: April, 26/2013 - 11:12

HCM CITY (VNS)— Viet Nam's airfreight sector has great development potential, but it needs to beef up its ability to compete against foreign rivals in the domestic market, experts said at a conference in HCM City yesterday.

Speaking at the Airfreight Logistics Conference, Do Xuan Quang, chairman of the Viet Nam Logistics Business Association, said that following Viet Nam's integration into the global economy, the aviation logistics industry had recorded commendable achievements, including the speedy construction and renovation of infrastructure.

"Our networks of warehouses, cargo terminals and distribution centres have been expanded, and ground handling services improved with greater customer service quality in mind," Quang said.

"Widebody freighters can land and take off at our modern airports. Customs clearance facilities have been overhauled and innovated to ensure expedited delevery of goods and minimising costs for exporters, importers and distributors."

Aviation regulations had been modified to meet current demands, he added.

However, Quang also acknowledged that despite the great improvements made this far, the sector still lagged behind those in other countries in the region in terms of facilities, technology, management skills and human resources.

This meant low competitiveness and inability to tap the sector's growth potential, he added.

Cyrille Picard, marketing director of Airbus Freighters, said: "Viet Nam dedicated air freight is flown by foreign carriers who enjoy flourishing and suitanable growth while zero per cent is the market share for Vietnamese carriers flying dedicated freighters."

To captialise on this market by improving their competence and competitiveness, local local companies should invest more in technology, equipment and training human resources, conference delegates agreed.

Rodrigo Reyes, regional cargo manager of the International Air Transport Association, said air cargo played a crucial role in today's world and was growing very fast. Air cargo represented a relatively small percentage by volume of world trade, but its significance had leaped by value. It was oriented towards high value or time sensitive products, Reyes noted.

There would be more challenges for the sector including security and safety challenges as importing countries increasingly tougher requirements, he said, adding that the US, for instance, required checks on all cargo transport to the country.

Challenges

Quang said: "In 2013, the aviation industry continues to face great challenges posed by the global economic downturn, rising fuel costs, airport security as well as human resource development constraints."

Reyes suggested that industry reshape itself, offering solutions aligned with customers' demands, reducing costs, accelerating transportation process and collaborating with supply chain partners to produce integrated solutions.

"Technology must be embraced" to reduce reliance on human intervention through e-booking, e-track, e-claims, e-delivery, and data exchange rather than message exchange, he said.

Speaking to the press on the sidelines of the conference, Quang said time was running out for Vietnamese logistics companies to consolidate their position in the domestic market, as next year Viet Nam would open its logistics market to foreign companies, making it much more difficult for local firms.

The country is home to about 800 logistics companies, of which just 10 per cent are local.

With their small size and limited ability, local companies can only offer limited services and account for just 15 per cent of the market share.

Stanley Lim, president of the International Federation of Freight Forwarders Associations (FIATA), said Viet Nam was an emerging country with a lot of opportunities for companies to capitalise on.

The conference was jointly organised by the Viet Nam Logistics Business Association, the Civil Aviation Administration of Viet Nam and the Viet Nam Logistics Review. — VNS


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