Air cargo shipping/global logistics: Asia Pacific air cargo traffic still in a tailspin
Patrick Burnson, Executive Editor -- Logistics Management, 12/2/2008
SAN JOSE, Calif.—The International Air Transport Association (IATA) announced international air traffic for October showing a second consecutive month of global decline. International air freight traffic contracted by 7.9 percent in October for a fifth consecutive month of increasingly severe drops, according to IATA spokesmen.
This steep decline in air freight has dragged year-to-date air freight volume to 0.8 percent below the same period in 2007. Forecasted declines in key air cargo sectors such as semi-conductors indicate that weakness is expected to continue.
“The slowdown in worldwide semiconductor sales that became evident in September continued in October,” said Semiconductor Industry Association President George Scalise. “The worldwide financial turmoil is expected to continue to impact demand for semiconductors as we enter 2009.”
Asia-Pacific carriers, which account for 44.7 percent of the international cargo market, saw international freight traffic decline by 11.0 percent reflecting the sharp drop in the region’s exports.
“The gloom continues and the situation of the industry remains critical,” said Giovanni Bisignani, IATA’s Director General and CEO, in a statement. “While the drop in oil prices is welcome relief, recession is now the biggest threat to airline profitability. The slight slowing in the decline of passenger traffic is likely only temporary. The deepening slump in cargo markets is a clear indication that the worst is yet to come,”
For Cathay Pacific Airways, the worst may already be here. In an announcement made yesterday, shippers were told that the carrier is scaling back its cargo business as part of a broad effort to cut costs at the airline amid declining demand.
The airline, the fifth-largest freight carrier in the world, will park two 747-400 converted freighters for a year and delay construction of its cargo terminal at the Hong Kong International Airport for up to two years.
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