IATA pessimistic on cargo growth this year
Asia-Pacific carriers saw a 5.2 per cent drop in demand in March 2016 compared to the same month last year, in part exaggerated by the effects of last year’s US seaport disruption which fueled strong demand for the region’s carriers, but demand continues to be weak with export volumes from emerging Asian economies having contracted in annual terms for 11 of the past 12 months.
May 5, 2016
By PLA Editor
The International Air Transport Association (IATA) has released a pessimistic view on air cargo growth saying, “it is shaping up to be another tough year for air cargo” pointing to the latest 2.0 per cent drop in volumes against a 6.9 per cent rise in capacity. Asia-Pacific carrier, in particular, saw a 5.2 per cent decline in demand in March compared with a year ago.
The latest IATA data for global air freight markets for March 2016 showing a 2.0 per cent drop in volumes measured in freight tonne kilometers (FTKs) compared to the same period last year. In contrast, freight capacity (measured in available freight tonne kilometers or AFTKs) rose by 6.9 per cent, putting increased pressure on already struggling yields.
The weak results reflect subdued growth in world trade, exaggerated by the comparison to a particularly strong start to 2015 when air freight volumes were boosted by the effects of the US West Coast seaports strike, IATA noted. The most significant fall in demand was reported by carriers in Asia-Pacific and North America. Combined they account for around 60 per cent of global freight traffic and reported declines of 5.2 per cent, and 1.8 per cent, respectively.
“It is shaping up to be another tough year for air cargo. February 2016 world trade volumes were only 0.4 per cent higher than at the end of 2014. And the expectations of purchasing managers gives little optimism for an early uptick. The combination of fierce competition, capacity increases and stagnant demand makes this a very difficult environment in which to generate profits,” said Tony Tyler, IATA’s director general and CEO.