Giant Airships Could Be a Trillion $ Industry

Mode	Cost per ton-km	Typical speed (kph)
Airplane	>$1	>800
Truck	15-20¢	100
Giant Cargo Airship (projected)	5-10¢	160
Rail	3-5¢	100 (but with transshipment delays)
Ship/Barge	~1¢	30

Now for the disclaimers. “Per ton-km” estimates of shipping costs always misleadingly oversimplify. Costs tend to be concentrated at transshipment points. It matters a lot whether there’s a payload for the return trip. Modes differ in reliability, and if occasional transport delays make expensive bottlenecks, it might not matter if a mode can offer cheap service and adequate speed most of the time. Handling is crucial for some cargoes, e.g., fragile or perishable ones. Sometimes space is a more binding constraint than weight, and lightweight, bulky cargoes often pay “chargeable weight” proportional to the space they occupy rather than their actual weight. Above all, not all modes go to all destinations: e.g., trucks can go wherever there’s a road, but not over bodies of water, while airplanes can cross water but can only land where there’s a port. And so forth. Logistics is complicated! As for the estimates of cost and speed for a giant cargo airship, suffice it to say, for the time being, that I do have some basis for suggesting that 160 km per hour and 5-10¢ per ton-km are attainable performance goals for a giant cargo airship, though it will take a lot of investment to get there. I’m not asking readers to trust me on that, except for the sake of argument.

2021-10-22: Airships to overcome lack of roads

Airships right now are interesting as a cost-effective substitute for less efficient cargo transportation that’s already happening. But they can be much more: one of the barriers to manufacturing exports in the developing world is that exports require infrastructure, and infrastructure generally requires spending, which needs to be funded, ideally from exports. If the fixed cost of participating in global supply chains drops, the beneficiaries will be people in the poorest parts of the world, who will have a shot at joining the global market. Transportation costs are high in the developing world, which amounts to a tax on imports and exports, benefiting no one. If countries can skip some of the expensive and time-consuming process of building road and railroad networks, and focus on ports, they can jump over a significant barrier to higher incomes.

2023-02-03: Eli Dourado does another market sizing.

Let’s say airships captured half of the 13 trillion ton-km currently served by container ships at a price of 10¢ per ton-km. That would equal $650b in annual revenue for cargo airships, notably much bigger than the $106b Boeing reports for the entire global air freight market. If one company owned the cargo airship market, taking only 50% of only the container market, it would be the biggest company in the world by revenue.

How many airships would we need to fill that demand? A lot. If each airship can carry 500 tons, cruises at 90 km/h, and is utilized 66% of the time, that adds up to 260 million ton-km per year per airship. To produce 6.5 trillion ton-km per year would require 25k such airships. This is about the number of airliners in the world today.

None of this analysis yet assumes any expansion of the market from normal growth, from the availability of a new service class, or from the ability to go point-to-point rather than shipping between existing ports. But it’s easy to imagine new trading patterns and even new companies forming because cargo airships exist. Just as Uber and Lyft massively expanded the vehicle-for-hire market, the added supply chain flexibility afforded by airships would stimulate new demand.