Subscribe to our free, weekly email newsletter!



Taxes and regulations thwart air cargo growth

By Patrick Burnson, Executive Editor
September 07, 2011

With the air cargo market continuing its decline, shippers are demanding that global governing bodies reassess their positions on taxes and new regulations.

Freight markets, which reflect economic sentiment more quickly than passenger markets, showed a decline of 0.4 percent in July compared to the previous year. The nature of the weakness has changed. In 2010, airlines were losing market share to other modes of transport as world trade expanded. The earthquake and tsunami in Japan, coupled with the general economic gloom are now the main driving factors of continued weakness.

Asia-Pacific carriers continue to show the weakest freight performance with a 3.6 percent decline compared to July 2010. Middle East and Latin American carriers showed the strongest performance with gains of 8.4 percent and 8.2 percent respectively.

Freight load factors have declined significantly (1.8 percentage points) to the pre-recession level of 45.0 percent. Asia-Pacific carriers, the largest in the market, have seen load factors slip to 58.1 percent (from 60.2 percent in July 2010). While the region suffers from a major imbalance with strong outward flows of manufactured goods and weak inbound traffic, the scale of their home carrier operations allows for better capacity utilization.

According to the International Air Transport Association (IATA), some of the challenges have a high percentage of government-made content.

“The recent downsizing of Air Berlin is a clear reminder of the high cost of the German departure tax on the economy, jobs and communities. Governments should not compromise aviation’s role as an economic catalyst for the short-term revenue gain of gratuitous taxation—particularly when economies remain weak,” IATA noted in a recent report.

About the Author

image
Patrick Burnson
Executive Editor

Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review magazines and web sites. Patrick is a widely-published writer and editor who has spent most of his career covering international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. You can reach him directly at .(JavaScript must be enabled to view this email address).


Subscribe to Logistics Management magazine

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your
entire logistics operation.
Start your FREE subscription today!

Recent Entries

The Department of Commerce reported that January retail sales were up 0.2 percent compared to December and up 3.7 percent annually at $449.9 billion, and the NRF reported that January retail sales, which exclude automobiles, gas stations, and restaurants, rose 0.6 percent over December and 1.4 percent compared to January 2015.

On the freight shipments side, Cass reported that January shipments––at 1.025––trailed December by 1.3 percent and January 2016 by 0.2 percent. These declines were less than the 4.9 percent drop from November to December, though, and January shipments still topped the 1.0 mark for the 65th straight month in December.

The Department of Transportation’s Bureau of Transportation Statistics (BTS) reported this week that its Freight Transportation Services Index (TSI) saw a 0.4 percent decline from November to December, its second straight decline on the heels of a 1.0 percent decrease from October to November.

Carloads saw a 11.7 percent annual decline at 241,680, and intermodal containers and trailers rose 10.5 percent to 262,830

An amendment to the International Maritime Organization’s Safety of Life at Sea convention will go into effect requiring all shippers (importers and exporters) to certify and submit the Verified Gross Mass – the combined weight of the cargo and the container – to the steamship line and terminal operator in advance of loading the container aboard a vessel.

Article Topics

Blogs · Air Cargo · Air Freight · Global Trade · All topics

Comments

Post a comment
Commenting is not available in this channel entry.


© Copyright 2016 Peerless Media LLC, a division of EH Publishing, Inc • 111 Speen Street, Ste 200, Framingham, MA 01701 USA