We use cookies to provide you with a better experience. By continuing to browse the site you are agreeing to our use of cookies in accordance with our Cookie Policy.
  • ::COVID-19 COVERAGE::
  • INDUSTRY PRESS ROOM
  • ABOUT
  • CONTACT
  • MEDIA FILE
  • Create Account
  • Sign In
  • Sign Out
  • My Account
Free Newsletters
  • MAGAZINE
    • Current Issue
    • Archives
    • Digital Edition
    • Subscribe
    • Newsletters
    • Mobile Apps
  • TRANSPORTATION
  • MATERIAL HANDLING
  • TECHNOLOGY
  • LIFT TRUCKS
  • PODCAST ETC.
    • Podcast
    • Blogs
      • Analytics & Big Data
      • Best Practices
      • Dispatches
      • Empowering Your Performance Edge
      • Logistics Problem Solving
      • One-Off Sound Off
      • Public Sector Logistics
      • Two Sides of the Logistics Coin
      • Submit your blog post
    • Events
    • White Papers
    • Industry Press Room
      • Upload Your News
    • New Products
      • Upload Your Product News
    • Conference Guides
    • Conference Reports
    • Newsletters
    • Mobile Apps
  • DCV-TV
    • DCV-TV 1: News
    • DCV-TV 2: Case Studies
    • DCV-TV 3: Webcasts
    • DCV-TV 4: Viewer Contributed
    • DCV-TV 5: Solution Profiles
    • MODEX 2020
    • Upload Your Video
  • MAGAZINE
    • Current Issue
    • Archives
    • Digital Edition
    • Subscribe
    • Newsletters
    • Mobile Apps
  • TRANSPORTATION
  • MATERIAL HANDLING
  • TECHNOLOGY
  • LIFT TRUCKS
  • PODCAST ETC.
    • Podcast
    • Blogs
      • Analytics & Big Data
      • Best Practices
      • Dispatches
      • Empowering Your Performance Edge
      • Logistics Problem Solving
      • One-Off Sound Off
      • Public Sector Logistics
      • Two Sides of the Logistics Coin
      • Submit your blog post
    • Events
    • White Papers
    • Industry Press Room
      • Upload Your News
    • New Products
      • Upload Your Product News
    • Conference Guides
    • Conference Reports
    • Newsletters
    • Mobile Apps
  • DCV-TV
    • DCV-TV 1: News
    • DCV-TV 2: Case Studies
    • DCV-TV 3: Webcasts
    • DCV-TV 4: Viewer Contributed
    • DCV-TV 5: Solution Profiles
    • MODEX 2020
    • Upload Your Video
Home » has air freight bottomed?
newsworthy

has air freight bottomed?

June 1, 2009
Mark B. Solomon
No Comments

After months of unprecedented declines, the worldwide airfreight market may be bottoming. But it could be awhile before a sustainable upturn takes hold.

Gary Schultheis, senior vice president, airfreight for global forwarder Deutsche Post DHL, says air export activity from Asia to the United States has picked up somewhat as summer approaches. South America is hanging in, he says, and the Middle East continues to be relatively strong. Europe, however, remains weak.

While the market remains fragile, Schultheis says it is nowhere near as weak as it was in January, which he says was the trough of the current downturn for his company's global network. Deutsche Post DHL's volumes began to pick up in February and March, he says. In April, however, volumes slipped to February levels, reflecting the typical Easter holiday slowdown. "But we're not going back to where we were in January," he says.

If air-freight executives believe things are looking up, it may be because there isn't much farther to fall. International air-freight traffic in January plummeted a whopping 23.2 percent year over year, followed by a 22.1percent decline in February, according to the International Air Transport Association (IATA). To put the declines in perspective, in September 2001, the month of the terrorist attacks on the United States and the subsequent shutdown of the nation's commercial air system, global air-freight traffic fell 13.9 percent, according to IATA.

In a late April statement, IATA economists said air-freight volumes may have bottomed because manufacturing activity and sales may no longer be falling faster than inventories are being liquidated. However, IATA said an upturn is "not yet in sight," citing still-elevated inventory levels and excessive consumer debt loads.

IATA said air freight acts as a leading indicator of global economic activity. Thus, an upturn in the sector, whenever it occurs, should be followed by an improvement in the broad global economy four to five months later.

For air shippers and freight forwarders, one bright spot in the bleak picture is that the capacity shortage that plagued users as recently as last summer has eased. Schultheis says freight capacity currently is abundant throughout the world, though he warns the situation could change on the trans-Pacific lane once Delta Air Lines grounds its remaining seven Northwest Airlines Boeing 747-200 freighters. The planes, which operate between Asia and the United States via Anchorage, Alaska, are scheduled to be withdrawn from service in December. However, Schultheis said he wouldn't be surprised if Delta pulled the planes down sooner if volumes don't pick up.

Trading down
One consequence of the global economic downturn has been the trading down of transportation services. Internationally, this has meant a migration from air to lessexpensive modes, or the use of air services that promise day-definite deliveries instead of the fastest transit times.

One carrier that's seeking to tap into the latter trend is TNT, a Netherlands-based express and mail delivery company. TNT is dusting off a three-year-old day-definite product that offers a combined air and less-than-truckload (LTL) service for heavy consignments (more than 150 pounds) moving from Europe to the United States. In early April, TNT announced that it had replaced its previous partner, YRC Worldwide, with Con-way Freight.

The service links the United States and Europe through TNT's European hub in Liege, Belgium, and New York's Kennedy International Airport. European exporters will tender freight to TNT, which will consolidate the shipments in Liege and load them on a freighter operated by ABX Air Inc. After the shipments clear customs at JFK, they will be moved into the Con-way network for final delivery.

Matt McDonough, president of TNT Express U.S., says customers should expect door-todoor transit times of three to six days, depending on the final destination. The service will offer guaranteed space and real-time track-andtrace capabilities. He reports that TNT plans to price the product below overnight or second-day air deliveries, but above an all-water move

McDonough says YRC's widely reported financial woes had nothing to do with the decision to switch to Con-way, noting that TNT had been talking to other prospective partners before YRC's difficulties became public.

Transportation Air
KEYWORDS Con-way Deutsche Post World Net International Air Transport Association (IATA) TNT Logistics
  • Related Articles

    The Logistics Matters podcast: How the Covid-19 pandemic has affected LTL; dealing with tight air and truck capacity; CSCMP EDGE goes virtual | Season 1 Episode 22

    Global air freight soars in May, IATA says

    Air freight market sinking under weight of trade war, IATA finds

Marksolomon
Mark Solomon joined DC VELOCITY as senior editor in August 2008, and was promoted to his current position on January 1, 2015. He has spent more than 30 years in the transportation, logistics and supply chain management fields as a journalist and public relations professional. From 1989 to 1994, he worked in Washington as a reporter for the Journal of Commerce, covering the aviation and trucking industries, the Department of Transportation, Congress and the U.S. Supreme Court. Prior to that, he worked for Traffic World for seven years in a similar role. From 1994 to 2008, Mr. Solomon ran Media-Based Solutions, a public relations firm based in Atlanta. He graduated in 1978 with a B.A. in journalism from The American University in Washington, D.C.

Recent Articles by Mark Solomon

Coming together for road safety: interview with Joshua Girard

Off the rails

Freight rate spikes shaking up the C-suite

You must login or register in order to post a comment.

Report Abusive Comment

Most Popular Articles

  • Cold chain giant Lineage Logistics buys its own rail operator

  • Outlook 2021: What’s in store for logistics supply chain?

  • Cushman & Wakefield Brokers Sale of 170 Acres plus Lease for 1MSF Build-to-Suit for Home Improvement Retailer in Commerce City, CO.

  • Thriving in the long haul: interview with Colin Yankee

  • Capacity challenges will continue in 2021

Now Playing on DCV-TV

2mw 01 18 21 thumb

LTL Carriers Using Yield Management Techniques to Identify New Accessorial Charges

DCV-TV 4: Viewer Contributed
As we head into 2021, shippers are not too optimistic about negotiating rates with their carriers. The reason for this, as highlighted in the three CODE RED Webcasts we've hosted with our friends from CSCMP and NASSTRAC, is that in today's transportation marketplace, shippers are operating in uncharted waters. With...

FEATURED WHITE PAPERS

  • Proven Benefits: A Compendium of Slotting Optimization Success Snapshots

  • Bridging Information Gaps in Dock and Yard Operations

  • How Intelligent Sensor Solutions Turn Data Into Action

  • Order picking Solutions: Understanding Your Options

View More

Subscribe to DC Velocity Magazine

GET YOUR FREE SUBSCRIPTION
  • SUBSCRIBE
  • NEWSLETTERS
  • ADVERTISING
  • CUSTOMER CARE
  • CONTACT
  • ABOUT
  • STAFF
  • PRIVACY POLICY

Copyright ©2021. All Rights ReservedDesign, CMS, Hosting & Web Development :: ePublishing