A landmark ‘call for action’ setting out 11 key recommendations for the UK to facilitate the sustainable growth of its economically-vital air freight industry has today been presented to the Government by Aberdeen Standard Investment’s AIPUT fund (Airport Industrial Property Unit Trust) and Logistics UK, the logistics industry business group.
In February 2021 Logistics UK and AIPUT jointly hosted a policy roundtable to discuss the steps that need to be taken by both Government and the industry to secure a prosperous future for UK air freight, which currently accounts for 40% of UK imports and exports by value. The discussions involved representatives from across the aviation industry including the warehousing sector, airlines, ground handlers, shippers and airports. Logistics UK has sought to harness the views of its members, working with AIPUT to set out the steps the industry believes are necessary to assure the future strength of UK airfreight and best position the industry to help Britain reinforce its position as a leading global trading nation in a post-Brexit world.
Aviation will play a vital role in securing new opportunities and growth post-Brexit and also in the UK’s recovery from the Covid-19 pandemic. Air connects Britain with the world, linking British products and expertise with billions of potential buyers overseas. Pre-pandemic, some 49% of the total value of UK exports outside of the EU travelled by air, through a combination of dedicated freighter flights and bellyhold through passenger services.
Throughout the pandemic and since the end of the Brexit transition period, the air freight industry has stepped up to the challenge, providing invaluable support to both the economy and the lives of everyone across the UK, through the rapid expansion of e-commerce and the movement of vital pharmaceuticals and medical equipment. In 2018, air freight services contributed £7.2 billion to the UK economy, supporting 150,000 jobs.
Logistics UK and AIPUT are calling for a renewed commitment by Government to work with industry to realise the full potential of the UK airfreight sector. The key priorities identified for both Government and industry are:
- Positive perception of aviation: For the Government to give a clear signal of its support, valuing it as a sector of national strategic importance and a crucial component of a Global Britain
- Joined-up approach – passenger and freight: Government support needs to be targeted at aviation in general, avoiding prioritising one sector above another
- Infrastructure: The UK needs to deliver the highest quality transport and real estate infrastructure serving its airports in order to fully support a vibrant, sustainable and globally competitive industry
- Funding: Government to give concessions for Air Passenger Duty (APD) and business rates to provide respite
- EU Exit: Negotiations need to be accelerated on traffic rights to open up key markets and routes, in addition to a long-term sustainable plan for freedom rights so that cargo can continue to move efficiently.
- Consumer behaviour: Digitisation in air freight is to be supported as it is essential to the growth of the new economy – the UK is currently one of the top three online shopping nations
- Innovation: The industry and Government must continue to drive innovation (e.g. automation) so that the UK airline industry can remain efficient and competitive
- Freeports: These must be structured in a way that they become a catalyst for new inward investment, jobs and skills growth, rather than diverting activity from elsewhere
- Regulatory relaxations: Appropriate planning flexibility at ports for warehousing and connectivity infrastructure is needed to support continued investment and flexible supply chains in air freight, facilitated by the sustainable expansion of airport capacity
- Decarbonisation: A commitment from Government to support research and development in aviation will help the industry decarbonise as quickly as possible through a combination of Sustainable Aviation Fuel and new technologies for electric and hydrogen aircraft that are fit for the future and cargo handling
- Air freight growth: Industry should be brave and more progressive, putting its vision into practice; leveraging its creative ideas, energy and innovation. Industry needs to know now more than ever that the Government is fully behind the sustainable growth of UK air freight
Nick Smith, Fund Manager at AIPUT commented: ‘We are delighted to partner with Logistics UK in presenting this detailed ‘call for action’, which if acted upon will ensure that the vital UK air freight sector can fulfil its maximum potential in helping UK plc to enhance its position as a major global trading force in the context of our emergence from both Brexit and Covid. Now is an opportune time for the Government to evidence its commitment to the industry and support its long-term sustainable growth.
“Air freight services contribute £7.2 billon to the UK economy and support 151,000 jobs . There is a clear and pressing need for further recognition of the strategic importance of this sector, which plays such a pivotal role in facilitating trade, investment and job creation.”
Elizabeth de Jong, Director of Policy at Logistics UK said: “Support for UK air freight, as it enters a new era outside the European Union and recovers from the global pandemic, is crucial; we must prioritise the steps needed to enhance the role of air freight in a post-Brexit world. Air freight is vital to our economy and we call on the government to work with the industry to realise its full potential as a cornerstone of global Britain.”
Press Enquiries for Logistics UK:
Eleanor Matthews/ Freya Penny
Logistics UK Press Office 07591 385614
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Notes to Editors:
About Logistics UK
Logistics UK is one of the UK’s leading business groups, representing logistics businesses that are vital to keeping the UK trading, and more than seven million people directly employed in the making, selling and moving of goods. With COVID-19, Brexit, new technology and other disruptive forces driving change in the way goods move across borders and through the supply chain, logistics has never been more important to UK plc. Logistics UK supports, shapes and stands up for safe and efficient logistics, and it is the only business group that represents the whole industry, with members from the road, rail, sea and air industries, as well as the buyers of freight services such as retailers and manufacturers whose businesses depend on the efficient movement of goods. For more information about the organisation and its work, including its ground-breaking research into the impacts of COVID-19 on the whole supply chain, please visit logistics.org.uk
- Aberdeen Standard Investments’ Airport Industrial Property Unit Trust (AIPUT) is an award-winning expert long-term investor specialising in industrial property on and near major UK airports. AIPUT is the only specialist airport-focused industrial fund in the UK for institutional investors with a life until 2036. AIPUT aims to deliver a positive ESG (Environmental, Social and Governance) performance impact throughout its portfolio, with a strategic target to achieve carbon neutrality by 2025. The fund has successfully achieved GRESB Green Star status in each of the last five years.
- The fund, which marked its 16 year anniversary in March 2021, manages a prime portfolio of properties providing high-quality and customised warehouse and logistics space:
- £600m assets under management (@ March 2021)
- 19 assets, amounting to c2.3m sq ft
- 2.1m sq ft of assets at Heathrow, making AIPUT one of the largest landlords around the airport, serving the evolving needs of the airport and the air-freight related industry
- Assets at London’s three major international airports: Heathrow, Gatwick and Stansted
- Target clients and investors – pension funds & expert institutional investors
- More information can be found at AIPUT’s dedicated website: www.aiput.co.uk
About Aberdeen Standard Investments
- Aberdeen Standard Investments is a global asset manager dedicated to creating long-term value for our clients. With over 1,000 investment professionals, we manage £455.6 billion* of assets worldwide. We have clients in c.80 countries supported by over 40 offices globally. This ensures we are close to our clients and the markets in which we invest. (*as of 30 June 2020)
- We are high-conviction, long-term investors who believe teamwork and collaboration are the key to delivering repeatable, superior investment performance.
- Standard Life Aberdeen plc is headquartered in Scotland. It has around 1.2 million shareholders and is listed on the London Stock Exchange.
- You can access the Aberdeen Standard Investments media centre here: https://www.aberdeenstandard.com/news-and-media
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