Tuesday, May 28, 2024
Growing GSSA operations in a rebounding region

Growing GSSA operations in a rebounding region

ECS Group has been actively expanding its presence in the Asian market, with a particular focus on the Northeast Asia region, including Japan and South Korea.  

In 2022-23, the company extended its operations in these countries. In 2023, ECS Group has relaunched its activities in New Zealand, indicating its commitment to providing comprehensive services across the Asia-Pacific region. Indeed, ECS Group’s subsidiary Wexco, which has been providing GSSA services for twenty years in New Zealand has recently gained momentum by securing contracts from major airlines such as Air Asia, Air China and Royal Brunei.  

ECS Group is also ramping up its cargo operations throughout China through its partnership with Royal Brunei Airlines, reflecting the significant potential for growth and collaboration in this region. 

“ECS Group has witnessed a generally supportive and dynamic environment throughout its presence in the Asian market,” Adrien Thominet, Executive Chairman of ECS Group,  said. “However, the market dynamics have experienced fluctuations, particularly due to the COVID-19 pandemic.”  

During the pandemic, the market faced challenges, including reduced airfreight demand and disruptions in supply chains. The recovery in China, a crucial player in the region, has been slower compared to some other countries.  

Nevertheless, ECS Group recognises numerous opportunities and synergies in the region, which it has been actively exploring. The company has also developed the Total Cargo Management model in collaboration with its partner Air Premia, which is specifically tailored to the Asian market, showing its commitment to innovation and adaptation.  

Operating from Air Premia’s main hub at Incheon Airport, ECS Group’s Korean teams are supporting the airline’s fast expansion to key destinations worldwide, with the recent addition of Frankfurt and Newark.   

“The establishment of the Squair Service Centre in India marks a significant step in ECS Group’s commitment to providing dedicated support for airlines in the Asian market,” Thominet stated. “Since its inception, there has been strong and rapid growth in the centre’s operations.” 

“This growth reflects the increasing demand for specialised support services, such as admin assistance, an AWB Verification service (Verify) and customs reporting services which are tailored to the unique requirements of the Asian market. ECS Group’s continuous investment in such dedicated centres underscores its dedication to serving its airline partners effectively in the region.” 

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Digitalisation and diversification 

Through its department Cargo Digital Factory, ECS Group has recently implemented digital tools to enhance its operations in the region. While digital tools are paradoxically and relatively new in some parts of Asia, there is significant potential for robust growth.  

These digital tools provide ECS Group with the means to streamline processes, improve data analysis, and enhance overall operational efficiency.  

“By harnessing technology and data analytics, ECS Group aims to offer more agile and data-driven solutions to its airline partners and customers in the Asia-Pacific region,” Thominet said. 

ECS Group has been diversifying its operations by introducing new service models, such as Total Cargo Management (TCM). This innovative approach allows ECS Group to offer a comprehensive suite of services that go beyond traditional GSSA functions. TCM involves a holistic approach to cargo management, covering everything from sales and marketing to revenue management and operations.  

“By diversifying into value-added services like TCM, ECS Group can provide more tailored and efficient solutions to its airline partners, setting itself apart in a competitive GSSA market,” Thominet explained. 

ECS Group’s All-In approach, exemplified by models like TCM, is particularly well-suited to serve low-cost carriers (LCCs) in the Asian market. LCCs often require cost-effective and streamlined cargo services to remain competitive. TCM, with its holistic management approach, aligns perfectly with the needs of LCCs by offering end-to-end cargo solutions.  

“This approach not only meets the needs of companies in the region but also positions ECS Group as a strategic partner in the success of its airline clients, especially in the fast-growing LCC segment,” Thominet said.  

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Capitalising on APAC’s recovery 

The Asian airfreight market presents both challenges and opportunities. Some of the key challenges include overcapacity in certain routes and the pace of China’s economic recovery post-COVID. Overcapacity can lead to price pressures and reduced profitability. Meanwhile, the rate and sustainability of China’s economic rebound can significantly impact airfreight demand, given China’s pivotal role in manufacturing and trade. 

On the other hand, the region also offers substantial growth opportunities, driven by e-commerce, changing consumer behaviours, and the rise of low-cost carriers. These trends have increased demand for efficient and reliable air cargo services. ECS Group, with its extensive network and innovative models like TCM, is well-positioned to capitalise on these opportunities. 

In 2023, ECS Group has observed a significant impact on yields in the airfreight market, even as volumes have returned to 2019 levels. This suggests that while demand has recovered, factors such as pricing and profitability have been influenced by various market dynamics, including competition and capacity issues. 

Looking ahead to 2024, ECS Group anticipates a relatively flat market compared to 2023. Market conditions are expected to stabilise, and the company will continue to focus on delivering efficient and high-quality services to its airline partners. ECS Group’s commitment to innovation and adaptation will play a crucial role in navigating potential challenges and seizing opportunities in the evolving airfreight landscape. 

ECS Group intends to further strengthen its presence by investing in digital tools and innovation,” Thominet said. “ECS Group’s local teams benefit from extensive training and easy access to the state-of-the-art technology developed by the GSSA’s in-house lab, Cargo Digital Factory.”  

Picture of Edward Hardy

Edward Hardy

Having become a journalist after university, Edward Hardy has been a reporter and editor at some of the world's leading publications and news sites. In 2022, he became Air Cargo Week's Editor. Got news to share? Contact me on Edward.Hardy@AirCargoWeek.com

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