Demand falls but capacity continues to rise in global air freight market, IATA stats reveal
Global air freight capacity growth has now outpaced demand for the last 12 months, resulting in a freight load factor that is currently 3.5 percentage points lower than a year ago.
The International Air Transport Association (IATA) April statistics show demand, measured in freight tonne kilometers (FTKs), fell 4.7% for the month, compared to the same period in 2018. This continued the negative trend in year-on-year demand that began in January.
Freight capacity, on the other hand, grew by 2.6% year-on-year in April 2019. The association says air cargo volumes have been volatile in 2019, due to the timing of Chinese New Year and Easter, but the trend is clearly downwards, with volumes around 3% below the August 2018 peak.
Brexit-related trade uncertainty in Europe and trade tensions between the US and China, have contributed to declining new export orders. In month-on-month terms, export orders have increased only three times in the past 15 months and the global measure has been indicating negative export demand since September. The continued weakness is likely to lead to further subdued annual FTK growth in coming months.
Asia-Pacific, Europe and Middle East suffered sharp declines, while Africa, Latin America and North America experienced modest increases in growth in April 2019.
Alexandre de Juniac, IATA’s director general and ceo, said: “April saw a sharp decline in air cargo growth and the trend is clearly negative this year. Cost inputs are rising, trade tensions are affecting confidence, and global trade is weakening.
“Airlines are adjusting their capacity growth to try and fall into line with the dip in global trade since the end of 2018. It all adds up to a challenging year ahead for the cargo business. Governments should respond by easing trade barriers in order to drive economic activity.”