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Is the worst over for airfreight?

[ May 6, 2020   //   ]

Air freight data for April offers some hope that the decline in the global economy is ‘bottoming out’, says industry analyst CLIVE Data Services

Volumes declined 39% year-on-year, but an even greater capacity drop of 45% highlighted the current capacity shortage. It says that air cargo volumes stabilised from mid-March to mid-April and became ‘less bad’ during the most recent two weeks to May 3, 2020.

CLIVE’s says its data bears out the sentiment expressed by economists from Goldman Sachs and Morgan Stanley in reports in early May  which suggest that the global economy is in the process of bottoming out.

CLIVE’s ‘dynamic load factor’ for April of 67%, based on both the volume and weight perspectives of cargo flown and capacity available, shows an increase of 4% points versus April 2019, reflecting pressure on capacity.

CLIVE managing director, Niall van de Wouw, said: “Until very recently, many airlines would have bumped cargo without blinking an eye, to accommodate the luggage of their passengers. These same airlines are now removing seats from these same planes to create more space for cargo. The uniqueness of this situation is reflected in the new term ‘preighter’ in the air cargo vocabulary, coined by Lufthansa Cargo. April 2020 was also unique. With a decline of 39% in volumes versus April 2019, it must be one of the worst months in air cargo’s history. But a greater fall in capacity, mixed in with the urgent need for PPE by governments around the world, explains also why current air cargo yields have reportedly gone through the roof.

“Although it is too early to tell if we are seeing the very earliest signs of the road-to-recovery, the most recent trend, coupled with the views of leading global economists, might give us hope. Could it be that the worst is behind us?”

However, he added that cargo staff around the world have been put on furlough or been made redundant.

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