After a lackluster few years for the air cargo industry, the CEO of Cathay Pacific Airways told CNBC he expects a recovery in global demand to rejuvenate the flagging sector.
The world's largest international air cargo carrier reported on Wednesday that it had returned to profit in the second half of 2012, posting earnings of HK$1.85 billion ($238 million), reversing a substantial loss in the first half of the year of HK$935 million.
However, total profits for last year were still down 83 percent year on year and the group has largely blamed the fall in profits on weakness in the global air cargo market, along with weak passenger demand and high fuel costs.
(Read More: Cathay Pacific 2012 Net Profit Plunges 83%)
"Air cargo correlates perfectly with world economic activity and when the world economy is doing better, certainly people have more money to buy things and air cargo is a fulfillment of that. Cargo is never down or up for long. It's been down for a while so it's probably time for it to go up," John Slosar, chief executive of Cathay Pacific Airways told CNBC's "The Call" on Thursday.
"Over the past 18 months there just hasn't been as much demand. Europe was a big part of that, and North America was better frankly because the U.S. economy has been better. But ultimately you need to get the world economy going and that's going to drive cargo," he said.
But Slosar added the airline saw a marked pick-up in air cargo traffic in the second half of 2012.
"Normally the second halves [of years] are better, because you have the big seasonal months, the summer months and Christmas. Also the corporate travel months of October and November came through a bit," he said. "We saw a bit of a boom in November and December," he added.
The International Air Transport Association (IATA) global air freight demand statistics for January 2013 showed a stabilization in the air cargo traffic market across the 240 airlines it represents, on the back on encouraging growth at the end of 2012. In January, global air cargo traffic grew by 4.5 percent year on year spurred by growth in Asia and the Middle East. In January 2012, by contrast, air cargo traffic had declined 1.5 percent year on year.
Separately, the airline said it was continuing to retire less fuel efficient Boeing 747-400 planes and said by mid-2014 the model would be fully absent from the fleet.
Meanwhile, the airline is busy revamping its regional business class offering.
"In the next 18 months, get on a Cathay airplane, and things are going to start looking pretty new," said Slosar.