GSSAs soar to new heights

Singapore freight forwarders – Star Concord
19-Feb-2024

The worldwide market share of air cargo General Sales and Service Agents (GSSAs) exceeded 25% and continued to grow in 2023, particularly in certain weight-break categories and in various world markets and regions, detailed analysis by WorldACD Market Data reveals. 

The GSSA market continues to evolve, with GSSAs taking on an ever-increasing range of functions for their airline principals, depending on the size, sophistication and priorities of the carrier and the relative importance and complexities of the individual market. 

Factors continuing to drive the outsourcing of sales and cargo management functions to GSSAs include carriers expanding into new markets, a need for increased flexibility in a world with more unpredictability, and pressures on personnel resources. GSSAs highlight a general shortage of skilled labour in many markets, noting that airlines areoften reluctant to add personnel or may face pressures to downsize their workforces or cut costs. GSSAs argue thatthey can provide a more entrepreneurial mindset and can more quickly upscale or flex personnel than airlines if the operation and volumes require it.

Leading GSSAs also report that carriers in the air cargo sector are increasingly demanding highly professional and dedicated services, particularly in operational efficiency, safety and security, business intelligence, and strategic guidance. These, and the need to invest in increasingly sophisticated technology solutions, are among factors also leading to further consolidation and growth among GSSAs. 

According to analysis by WorldACD, using its largest and most-detailed air cargo database in the industry, more than 26% of all air cargo is accounted for by GSSAs. This is a market share that has grown steadily over the years, growing by a further half a percentage point in 2023 (from 26.13% in 2022 to 26.61% in 2023). 

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Regional differences

Zooming in on the different regions of the global air cargo market, you find considerable differences. One striking element is the number of different GSSA companies that are involved in air cargo in different parts of the world. Most GSSAs are found in Middle East and South Asia (MESA), where WorldACD’s GSSA database shows 206 active players, followed by 177 GSSA companies in Asia Pacific. North America has relatively few GSSAs with just below 50 in total.

Moreover, there is also a big variation in market share held by GSSAs between individual regional markets, with GSSAs controlling just 15% of North America’s outbound air cargo market, while GSSAs control around 53% of MESA’s outbound air cargo business.

Looking at the year-on-year growth of GSSAs’ overall markets in the various main world regions, based on chargeable weight in 2023, versus 2022, WorldACD also separated out the inbound and outbound performance of the market as a whole for those regions – to give an overall general sense of how GSSAs are performing compared with the regional markets overall. The figures indicate that GSSAs performed better than the market as a whole in all of the main regional outbound markets, except Europe, with GSSAs significantly outperforming the overall market in Asia Pacific and in Central & South America. 

Shipment size factor

When it comes to the size of air cargo shipments, GSSAs’ market share seems to increase as the size of shipments increases, analysis by WorldACD indicates. For example, for shipments of 0-50kg, only around 17% of global air cargo business was accounted for by GSSAs in 2023, compared to 27% for all shipments of 500kgs and larger. Analysis also shows that in 2023, GSSAs have increased their market share throughout the whole air cargo business by at least one percentage point for five out of six specified weight breaks. But interestingly, GSSAs’ biggest market share increase in 2023 was actually in the 50-100kg category. 

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Special handling

A wide variety of air cargo products require special handling, due to (for example) the characteristics of the goods or conditions at the place of origin or destination, with special cargo representing around 40% of the market, and growing. Analysis by WorldACD indicates the extent to which GSSAs are responsible for the sales of these special products in 2023. Shipments of Valuables by air seem to be outsourced the least to GSSAs, while for meat, fish and seafood, as well as Live Animals and Pharma/Temp shipments, GSSAs are responsible for +30% of the market.

GSSAs’ involvement in air cargo business is particularly prominent in Europe and Asia Pacific. The figure below shows the distribution of market share per weight break per region. Europe and Asia Pacific dominate all the specified weight breaks with a combined market share (of the total market accounted for by GSSAs) of around 60-70%, although this also closely relates to the high volumes of air cargo in these regions compared to other regions in the world.

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Author: Edward Hardy