Air Freight Volumes Rose in November

International scheduled air traffic results for November show 8.2% year-on-year passenger traffic growth and a 5.4% increase for freight, according to the International Air Transport Association (IATA). The passenger load factor for November averaged 75.6% while the freight load factor stood at 55.2% for the month.

November saw traffic growth slow from the 10% increase recorded in the passenger business and the 14.5% growth in freight in October. The slowdown in 2010 is partially skewed because of the exceptionally rapid rise in traffic volumes recorded during the fourth quarter of 2009. However, when viewed in absolute terms, air travel fell by 0.8% and air freight fell by 1.1% between October and November 2010.

This slower growth does not necessarily signal a negative trend. Even with the decline in November, passenger and freight traffic are still expanding at annualized rates of between 5-6%, which is in line with the industry’s historical growth trend.

“The industry is shifting gears in the recovery cycle,” says Giovanni Bisignani, IATA’s director general and CEO. “Growth is slowing towards normal historical levels in the 5-6% range. Relative weakness in developed markets is being offset by the momentum of economic expansion in developing markets. We see a strong end to 2010 that boosted the year’s profit forecast to $15.1 billion. Slowing traffic growth is in line with our projections for a reduced profit of $9.1 billion in 2011. That’s a 1.5% margin. More hard work will be needed in the New Year to achieve sustainable levels of profitability.”

The air freight recovery hit a peak in May 2010. Compared to that peak, volumes have fallen 7%. The volume of air freight in November was equal to pre-recession levels of early 2008.

November’s year-on-year growth of 5.4% is a significant shift from the 14.5% recorded in October. This was exaggerated by the exceptionally strong performance in November 2009. In absolute terms, there was a 1.1% fall in freight volumes from October to November. All regions, except Africa, showed dramatic drops in year-on-year growth rates from October to November.

November freight carried by Asia-Pacific carriers showed a 4.1% year-on-year increase. The region’s carriers moved a similar amount of freight in November that they did at the pre-recession peak of 2008.

Middle Eastern carriers saw 12.4% year-on-year growth for November. The region’s carriers handled 14% more freight in November than they did at the pre-recession peak in early 2008.

North American carriers showed 1.5% year-on-year growth in November, but overall volumes remain 7% below the pre-recession levels of early 2008. European carriers experienced a similar pattern with 6.6% year-on-year growth in November but overall volumes remaining 12% below pre-recession levels.

“In 2010, the Icelandic volcano and the year-end adverse weather made the value of air transport crystal clear,” says Bisignani. “While memories of the travel chaos are still fresh, it’s time to evaluate a long list of government imposed industry handicaps, including excessive taxation, out-dated ownership restrictions, over-regulation where market forces could do better, under-investment in infrastructure and generally poor regulation of monopoly suppliers. We must not let governments forget all of this while waiting for a change of seasons.”

To that end, IATA is launching Vision 2050—a dialogue on the industry’s future among strategic thinkers from government, industry and academia. The group will meet in Singapore this February with the mission to build a vision for a successful and sustainable industry in four decades. The group will be guided by Singapore’s Minister Mentor Lee Kuan Yew and Harvard University’s Michael Porter.

Hide comments

Comments

  • Allowed HTML tags: <em> <strong> <blockquote> <br> <p>

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.
Publish