Barriers to trade need addressing to help stem the rising tide of challenges facing air freight, the International Air Transport Association (IATA) has said.
Announcing the latest figures for air cargo demand, IATA Director General and CEO Alexandre de Juniac said the increasingly negative trend provides a “challenging” year ahead for the industry.
Freight demand, measured in freight tonne kilometers (FTKs), fell by 4.7% in April year-on-year, continuing a negative trend that began in January.
Cost inputs are rising, trade tensions are affecting confidence, and global trade is weakening
“April saw a sharp decline in air cargo growth and the trend is clearly negative this year,” said Alexandre de Juniac, IATA's Director General and CEO.
“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.”
Capacity, measured in available freight tonne kilometers, grew by 2.6% compared to April 2018. It is the 12 consecutive month that capacity growth has outstripped demand.
According to IATA, the timings of Chinese New Year and Easter have played a part in volatile air cargo volumes this year, but the organisation said the trend “is clearly downwards” as volumes sit close to 3% below the peak of August 2018.
Brexit and the US-China trade wars are also contributing to declining export orders, with IATA expecting the weakness to continue and lead to further “subdued” growth in the months ahead.
See the breakdown by region below:
- Asia-Pacific airlines saw demand for air freight contract by 7.4% in April 2019, compared to the same period in 2018. Capacity fell 0.1%.
- North American airlines saw demand increase by 0.1% in April 2019, compared to the same period a year earlier. Capacity increased by 2.5% over the past year.
- European airlines posted a sharp 6.2% decrease in freight demand in April 2019 compared to the same period a year earlier. Capacity increased by 4.2% year-on-year.
- Middle Eastern airlines’ freight volumes decreased 6.2% in April 2019 compared to the year-ago period. Capacity increased by 0.7%. Air freight volumes have been declining since the fourth quarter of 2018.
- Latin American airlines experienced an increase in freight demand growth in April 2019 of 5.0% compared to the same period last year—a third consecutive month of positive FTK growth. Capacity increased by 18.7%.
- African carriers posted growth in April 2019 of 4.4% compared to the same period a year earlier. Capacity grew 12.6% year-on-year.