The E-Commerce Boom Is Reshaping the Air Freight Industry

The e-commerce boom is reshaping the air freight industry, forcing operators like AAT in Hong Kong to ramp up innovation, automation and specialised solutions to keep up.

Air-freight

Air freight (Photo: Freepik)

As Asia’s e-commerce and logistics networks accelerate, air cargo infrastructure must keep pace — AAT is focusing heavily on innovation, flexibility and regional connectivity to stay ahead.

Hong Kong International Airport (HKIA) is set to handle 4.9 million tonnes of cargo by 2024, reaffirming its position as the world’s busiest air cargo hub. With this volume forecast to grow, the need for cargo terminal operators to scale efficiently and sustainably is more urgent than ever. Asia Airfreight Terminal (AAT), a SATS company, is meeting this challenge with a combination of infrastructure upgrades, automation and network expansion.

“Our phased expansions—from Terminal 1 in 1997 to Terminal 2 in 2006—reflect our commitment to scalable growth,” said Mike Chew, CEO of AAT. “Today, we’re taking strategic steps to support the anticipated growth in the Asia airfreight market.”

AAT’s latest investments are diverse. To meet growing demand for perishables and pharmaceuticals, the company is launching the AAT COOLPORT in 2022, the first end-to-end temperature-controlled facility at a Hong Kong airport.
“It has increased our cold chain handling capacity by 50 percent,” noted Mr Chew.

Another major move is the opening of AAT Dongguan at the HKIA Logistics Park in early 2023. “This brings cargo acceptance closer to the Greater Bay Area’s manufacturing and logistics hubs,” said Mr Chew. “It enhances connectivity, reduces transit times, and strengthens our service network for the mainland market.”

AAT is also deploying autonomous electric tow trucks at its terminals, a first for Hong Kong. “We’re optimising operations, reducing processing times, and lowering emissions—balancing growth with sustainability,” he added. The company’s scalable growth approach relies on this balance, ensuring the flexibility to adapt to market changes while minimising its environmental footprint.

“Through continuous cooperation, strategic expansion, and innovative solutions,” said Chew, “we remain fully committed to advancing our industry.”

Shifting priorities in the air cargo industry

Surge demand from Shein, Temu and cross-border retail has reshaped the air cargo industry — AAT is responding with technology focused on safety and speed. Cross-border e-commerce is no longer a niche market — it is reshaping the structure and expectations of the air cargo market. For cargo terminal operators like AAT, the pressure is mounting to handle higher volumes of small parcels, tighter schedules and more complex safety requirements.

“The rapid growth of cross-border e-commerce has transformed air cargo demands,” acknowledged Chew. “AAT is constantly adapting its services to cater to the specific needs of e-commerce logistics.”

One of the most pressing concerns is safety. Shipments of lithium batteries, which are common in electronics orders, pose an increased risk. “We obtained the CEIV Lithium Batteries certification in 2022, becoming the first CTO in Hong Kong to do so,” Chew points out. “We’ve also established dedicated inspection counters staffed by a well-trained team, and we’ve integrated automated safety features like sensitive wording detection.”

Security and screening have also been further customized. AAT’s AAS SecurePlus solution — a one-stop logistics solution operated by its subsidiary Asia Airfreight Services — has been specifically designed for e-commerce. “It provides a secure and efficient solution for our customers,” Chew says.

These operational changes have been accompanied by a renewed focus on flexibility in customer service. “We are continuously enhancing and customising our services to align with our customers’ evolving needs,” he says. This includes faster turnaround times, transparent shipment tracking, and modular service packages built for high-volume e-commerce and small parcels.

For AAT, agility is not an option. “We consistently adapt to the changing landscape of air cargo,” said Chew. “That’s how we ensure operational efficiency, safety, and customer satisfaction.”

Resilience in an uncertain world

With geopolitical tensions and shifting global trade routes disrupting air cargo flows, agility, digitalisation and proactive planning are central. Global air transport operations are being challenged by changing tariffs, regulatory uncertainty and escalating geopolitical tensions. For AAT, remaining agile and future-ready is more than just a strategy — it’s a requirement.

“In response to the ongoing geopolitical tensions, we’ve adopted a proactive and forward-looking approach to ensure our operations remain resilient, flexible, and reliable,” said Chew.

At the heart of that resilience is flexibility—in infrastructure, systems, and people. “Ensuring our operation is responsive to changing demands and capable of scaling up or down quickly is crucial,” he explains. “This includes having expandable capabilities within terminals and flexible workforce management systems.”

Digitization is another pillar. “In early 2024, we became the first cargo terminal operator to deploy autonomous electric tractors in terminal operations,” Chew notes. “We’re also preparing to fully digitalise the import collection process—from issuing electronic shipment release forms (eSRF) and online payment to integrating automatic truck dock allocation and online queuing.”

Artificial intelligence is also playing a role in safety. “We’re trialling AI-driven systems to monitor safety and security risks in real time,” says Chew. “This helps us mitigate incidents and maintain a safe working environment.”

The company also relies on collaboration with key stakeholders. “We work closely with government agencies, airlines, freight forwarders, and trade associations,” he adds. “This helps us anticipate challenges early and coordinate solutions effectively.”

Transparent communication remains the foundation of trust. “Transparent communication with our customers and partners helps manage expectations during uncertain times,” stresses Chew.

High-tech systems support a wide range of cargo

From perishables to dangerous goods, AAT’s dedicated facilities and automated systems are built to handle every market requirement.

AAT’s ability to handle a wide range of cargo comes from investing in dedicated facilities and advanced cargo handling systems. With sectors such as pharmaceuticals, perishables and dangerous goods driving growth in the air freight industry, cargo terminal flexibility is essential.

“Our terminals are outfitted with specialised facilities, including COOLPORT, strong rooms, live animal storage, and dangerous goods rooms,” said Mr Chew. COOLPORT alone is certified with WHO GDP Pharma, IATA CEIV Pharma, and IATA CEIV Fresh, making it particularly suited to temperature-sensitive cargo.

“It allows us to cater to the unique requirements of perishable goods ranging from -28°C to 25°C.”

In terms of dangerous goods, AAT’s facilities comply with international safety standards and are operated by trained professionals. “These specialised areas are equipped with the necessary infrastructure and protocols to handle dangerous goods in compliance with international standards,” Chew noted.

Automation continues to drive efficiency. Terminal 2 houses four of the world’s tallest lift vehicles (ETVs) — each 43 metres tall and capable of making 150 moves per hour. “This innovation optimises capacity utilisation and ensures swift, precise handling of cargo,” Chew said.

AAT has also switched from RFID to Automatic License Plate Recognition (ALPR) to manage truck flows more intelligently. “It integrates seamlessly with our COSYS+ cargo management system to optimise dock allocation based on cargo proximity,” he said.

The goal: seamless, scalable cargo management that supports the ever-changing needs of a complex market.

“Our continuous embrace of technology and innovation allows us to elevate operational standards and uphold the highest levels of precision and safety,” concluded Mr Chew.

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