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Home » International air cargo shows modest rise in November after weak third quarter, IATA says
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International air cargo shows modest rise in November after weak third quarter, IATA says

January 9, 2013
DC Velocity Staff
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International air cargo traffic showed a slight upturn in November after a weak October, the International Air Transport Association (IATA) said today. Volumes increased 1.6 percent over last year's figures and up 2.4 percent over October's traffic, the association said.

IATA said the November gains moved it to forecast a 1.4-percent year-over-year increase in cargo volumes in 2013. While the projected gains seem modest, they are an improvement over the sequential and year-over-year declines the air cargo sector has recently suffered. Airfreight volumes in October fell 3.5 percent from the same period in 2011, IATA said last month.

IATA said seasonally adjusted freight volumes as of the end of November have returned to mid-2012 levels.

The Geneva, Switzerland-based group attributed the November performance to improved consumer confidence in the United States and more shipping activity from online retailers as they entered into the pre-holiday buying season. IATA said in a statement accompanying the data that online retailers "depend heavily on air cargo."

In the U.S., however, many online retailers get their goods to market via a surface transport partnership between integrated carriers like FedEx Corp. and UPS Inc. as well as parcel consolidators, all of whom then tender parcels to the U.S. Postal Service for last-mile deliveries to mostly residential addresses.

"It is premature to consider this a turning point for air cargo markets in terms of bouncing back and regaining lost demand," said Tony Tyler, IATA's director-general and CEO, in the statement. Tyler added, however, that a firming U.S. economy and improving consumer confidence should combine to create a "return to growth" in 2013.

Once a booming industry, international air cargo has lost much of its luster in the past decade as slowing economic growth has forced shippers and consignees to reduce their reliance on premium-priced air freight. Air freight has also faced growing competition from ocean services that have become faster and more reliable. As a result, businesses can move global shipments to market more rapidly than traditional sea freight but at a significant discount to air.

Frederick W. Smith, founder, chairman, and CEO of FedEx Corp., has said that the airport-to-airport cargo business that airlines specialize in will show little or no growth in the years ahead.

Asia-Pacific airlines accounted for half of the sequential rise in November volumes, reporting a gain of 2.4 percent over October figures. Year-over-year, however, traffic fell 1.5 percent, IATA said.

North American carriers reported a 1.7-percent year-over-year increase, while European airlines' cargo traffic was essentially flat, IATA said. Middle East carriers reported the strongest year-over-year growth with traffic jumping 16 percent from November 2011.

Latin American carriers grew their freight traffic by 4.2 percent year-over-year, though cargo capacity increased by more than twice that rate during the period, IATA said.

IATA represents 240 airlines that collectively account for 84 percent of global airline traffic.

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KEYWORDS FedEx
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