Page 10 - AAA MARCH - APRIL 2016 Online Magazine

FEATURE IATA
FEATURE IATA

New Normal

The outlook for air freight and world trade remains fragile, but there are some signs that
the decline in cargo demand is bottoming out
By Jay Menon
DEmAND FOR AIR FREIGHT ROSE jUST in cargo demand were bottoming out. America suffered a steep decline (-6.0 per
2.2 per cent in 2015, down from the 5 per cent “In 2011 air cargo revenue peaked at cent) while the Middle East grew strongly, up
growth seen in 2014, due to sluggish trade US$67 billion. In 2016 we are not expecting 11.3 per cent. Africa also saw modest growth
growth in Europe and Asia, the International revenue to exceed US$51 billion,” Tyler said. of 1.2 per cent. The freight load factor (FLF)
Air Transport Association (IATA) has said. After a strong start, air freight volumes was at times the lowest for some years, falling
“The year 2015 was very difficult year for began a decline that continued through most to an average 44.1 per cent compared to 45.7
air cargo. This was a slower pace of growth of 2015, until some improvements to world per cent in 2014, driven down by weak demand
than the 5.0 per cent growth recorded in trade drove a modest pick-up late in the year. and capacity expansion.
2014. The weakness reflects sluggish trade Cargo in Asia-Pacific, which accounts for “Efficiency gains are critical as the sector
growth in Europe and Asia-Pacific,” said around 39 per cent of freight traffic, expanded adjusts to shortening global supply chains and
IATA’s Director General and CEO Tony Tyler. by a moderate 2.3 per cent. The key markets evermore competitive market conditions.
The association said while the outlook of Europe and North America, which between We have to adjust to the ‘new normal’ of
for air freight and world trade remains them comprise around 43 per cent of total cargo growing in line with general rates of
fragile, there were some signs that declines cargo traffic, were basically flat in 2015. Latin economic expansion. The industry is moving

YTD 2015 vS. YTD 2014

FTK Growth AFTK Growth FLF
International 2.5 per cent 6.4 per cent 47.6
Domestic 0.1 per cent 4.6 per cent 29.6
Total Market 2.2 per cent 6.1 per cent 44.1

FTK: freight tonne kilometres measures actual freight traffic
AFTK: available freight tonne kilometres measures available total freight capacity
FLF: freight load factor is per cent of AFTKs used

10 ASIAN AIRLINES & AEROSPACE MARCH / APRIL 2016 WWW.GBP.COM.SG/AAA