Air cargo may be finally staging a comeback

The International Air Transport Association announced international traffic results for October showing a 14.4 percent for year-on-year increase for international freight.
By Patrick Burnson, Executive Editor
November 29, 2010 - LM Editorial

A slight surge in air cargo demand has some industry analysts predicting a prolonged rebound.

The International Air Transport Association (IATA) announced international traffic results for October showing a 14.4 percent for year-on-year increase for international freight.

“As we approach the end of 2010, growth is returning to a more normal pattern,” said Giovanni Bisignani, IATA’s Director General and CEO. “Where we go from here is dependant on developments in the global economy.”

Charles Clowdis, managing director of transportation for IHS Global Insight, agrees that the freight sector may have reached a “turning point.”

“Following a promising ‘Black Friday,’ it appears U.S. consumers are ready to spend again,” he said. “That trend will be expressed in future cargo levels, but don’t expect a big increase. We are still not back to where we were five years ago.”

IATA, too, noted that The US is spending more to boost its economy.

“Asia outside of Japan is barrelling forward with high-speed growth. And Europe is tightening its belt as its currency crisis continues. The picture going forward is anything but clear, but for the time being, the recovery seems to be strengthening,” said Bisignani.

Freight appears to finally be staging a comeback. Since May, freight volumes have declined by 5 percent. October saw an end to the decline in freight with a slight uptick.
“But a single month does not make a trend. And it remains to be seen if this is the stabilization in freight volumes or the start of an upward trend,” said Bisignani.

Improvements in demand are being met by “a cautious approach” to capacity expansion, said IATA. Over the first 10 months of the year, cargo capacity expansion of 9.2 percent was well below the demand increase of 24 percent.

Meanwhile, North American airlines posted a 12.4 percent demand increase over October 2009. October represented the fastest growth rate for the year. With a capacity increase of 11.9 percent, the load factor for North American airlines was pushed to 82.5 percent, the highest among all regions. Compared to pre-recession levels of early 2008, the region’s airlines are carrying 2 percent more traffic.



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).


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Article Topics

News · Air Cargo · Freight · Transportation · IATA · All topics

About the Author

Patrick Burnson, Executive Editor
Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review. Patrick covers 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. Contact Patrick Burnson

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