1. Despite the higher cost, air freight will likely continue its upward growth. The increasing demand for perishables, chemicals and valuables are some of the key factors in this trend. Delays at ports, labor strikes and reduction of vessels can trigger a sudden increase in demand. The Covid-19 pandemic has been one of the events that has increased the need for air freight since vaccines and PPE were needed in various countries on a short delivery notice. Of course, the supply chain issues as part of the Covid-19 pandemic have contributed to the scarcity of products and availability of components. Importers have increasingly turned to air freight as a more timely and reliable source to satisfy their customers. Just-In-Time (JIT) manufacturing systems and variations thereof have become the norm. Manufacturers expect and need materials and components, understanding that air freight can help alleviate production line shut-downs. E-commerce has also been contributing to the increased volume of air freight. Air freight growth will depend directly on demand, disruptions and supply.

While typically providing faster service, air freight will likely continue to be the most expensive mode of transport into the foreseeable future. It is not the major mode of transport since ocean and ground are usually more cost-effective when time is not the critical factor. Air freight will continue and grow with its focus on perishables, valuables, chemicals and urgent needs. Consumers will ultimately drive the increase in air freight as increased demand and higher expectations will force distributors, wholesalers, dealers and retailers to respond to their needs.

2.I was surprised to read in our textbook that air transportation is expected to grow significantly over the next decade. There are two reasons:

1. Sustainability: there is a strong focus on businesses' carbon footprint today. Seeing how air freight is extremely pollutant, I would've thought most businesses would try to avoid it.

2. Cost: ocean carriers have invested significant money into building new vessels, meaning ocean freight rates will decrease over the next few years because capacity will increase much faster than demand. I would think companies would find ocean freight more appealing because of the major difference in costs.

However, I can understand that air freight would become more popular because of the following reasons:

1. Technological progress in the manufacture of planes, which should help reduce costs.

2. Air carriers providing integrated services make air freight much more appealing. We ship samples by air (our regular orders are shipped in ocean containers or in FTLs), and it used to be extremely challenging to get samples to destination. There would always be some type of hold (customs or other) and samples would end up being spoiled. We transitioned that part of our business to Fedex and our samples now get delivered without issues.