Page 11 - AAA NOVEMBER - DECEMBER 2022 Online Magazine

AIR CARGO

© Boeing

TURBULENCE AHEAD

THE AIR CARGO INDUSTRY WILL Disappointing Year

ENTER 2023 FACING HEADWINDS BUT Growth in new export orders, which is a major
THE LONG-TERM PROSPECTS OF THE indicator of global air cargo demand, was on
a free fall during the current year. Air cargo
SECTOR CONTINUE TO BE BRIGHT volume also shrunk, and if one were to go by
IATA’s forecast, 2023 is not expected to bring

ARUN SIVASANKARAN good news for the sector. While airlines are
expected to see profits next year after three
difficult years due to the pandemic, cargo
In hindsight, it was unrealistic to expect the air cargo industry to volumes, yields and profits are set to decline.
beat or even sustain the heights attained during a resoundingly
successful 2021. Air cargo revenues are expected to touch
US$149.4bn in2023, which is US$48.6bn more
In November, air cargo volumes declined 8 per cent year on year than in 2019 but as much as US$52bn less
and were down 2 per cent on October. The dynamic load factor, than the current year. Cargo volumes are
which is based on weight and space, was 61 per cent, down five likely fall for the second year in a row, down
percentage points on last year. to 57.7m tonnes from 60.3m tonnes this year

The headwinds faced by the industry were apparent much earlier, and 65.6m tonnes in 2021.
with November being the ninth month in a row to witness shrink- “This reflects the challenging global economic
ing demand. In October, International Air Transport Association backdrop in terms of global economic growth
(IATA) statistics revealed that air cargo tonne km had declined but also in terms of international trade,” says
by 13.6 per cent year on year while capacity was down 0.6 per Andrew Matters, IATA head of policy analysis.
cent. Load factors also slipped by 7.4 percentage points on last
year to 48.7 per cent. Yields grew by 7 per cent this year, 24 per
cent in 2021 and by as much as 50 per cent
In what is a significant cause of worry for the sector that had in 2020, but with load factors return to pre-
helped aviation industry stay afloat during the pandemic, all Covid levels; a decline of about 22 per cent is
the signs point to air cargo market conditions deteriorating well expected in 2023. According to Matters, it was
into 2023. not realistic to expect current yield levels to

ASIAN AIRLINES & AEROSPACE NOVEMBER-DECEMBER | 11