According to date from IATA, air freight markets
in March 2014 were up 5.9% compared to a year ago and capacity
While this marks a significant improvement in volumes
compared to March 2013, much of the growth took place in the final
quarter of 2013 (over and above the usual year-end volume growth).
Since the beginning of the year, air cargo volumes have been
Business conditions in the US and Europe,
provide a reason to be cautiously optimistic for a resumption of growth in the months ahead. Rising export orders, in particular,
are expected to give positive momentum to US and European markets.
But this is balanced against the impact of a slowdown in Chinese
manufacturing which is now into its fourth month. This has already
impacted exports from emerging Asian countries, which contracted
“Cargo markets had a boost in the last quarter
of 2013, but have now leveled off. It is a competitive industry
with growing capacity chasing weak demand. The business cycle will
eventually swing upwards. But the air cargo industry also needs to
improve its value proposition if it is to attract growth when
markets improve. Modernizing air cargo processes and infrastructure offers the potential to cut end-to-end shipping
times by up to 48 hours. We cannot let market doldrums hold us
back from this critical competitive gain,” said Tony Tyler, IATA’s
Director General and CEO.
In the 40 years since the
introduction of the 747 freighter, the end-to-end shipping time
for goods by air has remained unchanged, at six to seven days.
During this period, innovators have created a new value
proposition for shippers and consumers based on an end-to-end
model, speeding up deliveries through integrating the airline and
ground components of freight, challenging the existing business
model for many participants. At the World Cargo Symposium in
March, IATA’s Global Head of Cargo Des Vertannes challenged the
industry to cut the end-to-end air freight shipment time by 48
hours by the year 2020, to enhance the competitiveness and value
of air cargo.
Asia Pacific carriers grew 6.9% compared to a year ago. Some of
the March growth will reflect a resumption of business activity
after the break for the Lunar New Year. Looking ahead, however,
the continuing slowdown of Chinese GDP growth is likely to
ultimately impact trade growth and air freight demand for local
carriers. Capacity grew by 7.5%, running slightly ahead of demand.
European airlines expanded by 5.1% compared to March
2013. Measures of business activity in the Eurozone have been pointing to continuous expansion since mid-2013, which is expected
to be maintained. Capacity expanded just 1.3%, strengthening load
North American carriers grew 1.9%
year-on-year. The slower growth could be a reflection of the
weather-related disruption in the first quarter of the year.
Business fundamentals in North America are strong, which should
support greater air freight volumes in coming months. Capacity
declined by 0.3%.
Middle Eastern carriers saw a 13.2%
year-on-year rise in FTK volumes. This strong performance comes on
the back of airlines taking advantage of growth in both developed
and emerging markets. Carriers in the region are expanding their networks and services, broadening the range of goods they
transport. Capacity grew just 4.7%, taking the load factor to nearly 50%.
Latin American air freight volumes were
flat. Trade in the region deteriorated in early 2014, which could
explain the slowdown. Capacity rose by 2.3%, weakening the load
African airlines expanded 5.9% compared to
March 2013. Growth in the region remains volatile, but the average
for the first quarter was an expansion of 1.5%. Growth has been
affected by a slowdown in the South African economy. Capacity grew broadly in line with demand, at 5.5%.
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