IATA report 2013 as a 'weak' year for airfreight

The International Air Transport Association (IATA) has reported airfreight saw a weak growth during 2013, with only 1.8% more volumes overall compared to the previous year. The trend is a possible reflection of on-shoring, where manufacturing is kept close to its market. Domestic freight tonnes carried and freight and mail tonne kilometres both saw domestic growth overtake international increases.

The amount of tonnes carried increased by 3.4% domestically, however internationally the increase was a sheer 1.3%. Freight and mail tonne kilometres rose by 2.9% domestically, while international traffic saw a rise of 1.6%. Despite the slight increases, IATA's Director General and Chief Executive Officer, Tony Tyler, has said that 2013 saw "48 million tonnes of cargo...carried on about 100,000 flights a day."

Statistics also reported the decreases in the average price of jet fuel, brining it down by 3.9% in 2013 compared to 2012, however this year has seen a slight rise in jet fuel prices again.

According to the World Air Transport Statistics, the top 10 airlines for tonnes carried were; Asiana Airlines, Lufthansa, Qatar Airways, Singapore Airlines, China Airlines, Cathay Pacific Airways, Korean Air, United Parcel Service, Federal Express, with Emirates being the number one.

IATA welcome Glyn Hughes as global Head of Cargo

The International Air Transport Association (IATA) has recently announced Glyn Hughes as its next global Head of Cargo. Hughes is no stranger to the company, having joined IATA in 1991 to assist in helping expand and develop the cargo accounts settlement service. Hughes helped the service grow from 35 to nearly 100 operations, whilst also maintaining extremely low levels of agency default and reducing the overall operating costs for its members.

IATA's new Head of Cargo, Glyn Hughes

Hughes has also led IATA Cargo's initiatives over recent years, becoming involved with industry management and relationship building. He has also been part of the global air cargo advisory group steering committee, in additional to leading a campaign to promote the value and use of air cargo.

IATA's Director General and Chief Executive Officer, Tony Tyler, has commented on Hughes' movement within the company: "I am delighted that Glyn has agreed to become our new hard of cargo. He has worked very closely with [former Cargo Head] Dan Vertannes these past four years and is well placed to continue the important work."

Tyler proceeded to advise that "air cargo faces considerable challenges" and that the company has an "ambitious goal to improve the industry's competitiveness." Tyler believes Glyn's addition will ensure focus is "dedicated to that goal", in additional to delivering the industry priorities, which include safety, security, quality, modernisation and transformation through the e-cargo agenda.

Hughes began his new duties recently by speaking at IATA's 70th annual general meeting in Doha. Hughes presented in regards to the air cargo industry, speaking on three key areas, these being: safety, security and modal competitiveness.

IATA urges more cooperation between Eastern Europe and Aviation leaders

Addressing delegates at the IATA Aviation Day Eastern Europe conference which opened in Bucharest last week, IATA's CEO Tony Tyler urged greater cooperation between Eastern European governments and aviation industry stakeholders: “Aviation connectivity can play a key role in the economic success of Eastern Europe. But in order to achieve these benefits, the region will need to tackle some long-standing problems which hamper competitiveness and innovation,” he said.

Tyler named the environment, passenger rights and infrastructure as three areas where governments should embrace innovation. Firstly, for the industry to achieve carbon neutral growth by 2020, cooperation from governments would be required, he said. On the issue of passenger rights, Tyler focussed mainly on competition and the need for governments to take responsibility for protecting consumers by ensuring service standards are maintained and regulated. Finally, when addressing the topic of infrastructure, Tyler highlighted that the most pressing issue was the Single European Sky and emphasised that the lack of political will to push states to unify European airpace is costing the continent EUR5 billion annually.

Source: IATA

European Air Cargo manages a 1% rise in May, in a sluggish month for the industry

IATA have recently released figures reporting on the global air cargo market growth for May: broadly speaking, the market has continued to flatline, following the trend of the last 18 months. Global freight tonne kilometres increased slightly by 0.8% year-on-year, and while capacity increased by 2.1%, load factors fell to 44.9%, the lowest level since post-crisis recovery.

The sluggishness in the market has been attributed to a variety of factors including the decelerated growth in developing economies such as China China and the global decline of business confidence. Tony Tyler, Director General and CEO of IATA, said, “It is getting harder to find optimistic signs for air cargo growth. The Middle East remains a bright spot, and the rate of decline in the Eurozone is easing. But this is offset by the weakening of expansion in Asia-Pacific. It is now clear that the positive global upswing in air cargo at the end of 2012 was an illusion. Air cargo, along with many parts of the world economy, appears to be in suspended animation at the moment”. 

The Middle East region saw the most growth, with a year-on-year increase of 9.7%, Europe was second in line with the much lower figures of 1% growth, followed by Africa at just 0.2%. All other regions, comprising Latin America, North America and Asia Pacific, registered slight declines. 

Middle East sees 10.5% air cargo growth, amidst a slow month for other regions

IATA (the International Air Transport Association) recently published their market analysis for March. Air freight markets weakened during this last month of the first quarter, suggesting that growth rates noted at the end of 2012 have stalled. International markets as a whole saw reductions in both actual freight tonnage (-2.1%) and capacity (-0.3%); but in spite of this slump, the Middle East and Africa saw a growth in traffic, with the former region seeing an increase of a remarkable 10.5%.

African cargo grew by a more modest 3.2%, while every other region saw a fall in traffic of between 0.8% (Latin America) and 5.2% (North America). While the Asia- Pacific region saw a fall of a less dramatic 3.3.%, since this region accounts for 38.5% of the market, the area saw the biggest drop in actual freight volumes. The European market was also flagging, with a traffic reduction of 4%.

Compared to the economic nadir of October 2012, global air freight volumes were up 1.5%. In spite of this relatively low growth, Tony Tyler, IATA’s Director General and CEO commented: “The March decline in air cargo is most likely a temporary stall. The fundamentals for a sustained improvement in air cargo volumes are in place. Business confidence continues to signal forthcoming expansion, and the solid increase in new export orders seen in 2013 should boost air freight in the coming months." 

Speaking of region-specific performance, Tyler said:  "Much of the current weakness is coming from Asia-Pacific airlines. While the region is economically strong, the economies of its trading partners are not. The Eurozone is showing renewed weakness and the negative impact of US budget cuts is yet to be fully measured”. 

Clearly, the air cargo sector is by no means immune to the vicissitudes of the global economic crisis. Perhaps Matthew Mariott, commercial director of Hellmann Worldwide logistics UK, was correct in stating that the way forward for the industry is low yet sustainable growth.  

Source: IATA