Singapore’s Changi Airport Group (CAG) has announced a package of support measures for its cargo partners at Changi Airport intended to provide cost relief amid a challenging outlook for the global airfreight industry.
In a statement, CAG said these measures, which include a one-time special assistance package (SAP) for cargo agents and the extension of a landing fee rebate for scheduled freighter flights, will apply for a year starting April 1, 2016.
Currently, cargo agents leasing cargo facilities from CAG at the Changi Airfreight Centre benefit from an incentive scheme which rewards them based on the volume of cargo handled. This scheme will be extended to 2016-2017 to provide Changi’s cargo partners with continued cost assistance while encouraging growth.
“In addition, in view of the uncertain industry outlook, CAG will be enhancing the scheme in 2016/17 with a one-time SAP to provide increased cost support to cargo partners. With this enhancement, cargo agents that achieve strong growth will potentially be able to enjoy cost relief equivalent to a rebate of up to 45% on their annual rental,” said CAG
On top of this, CAG will be extending the existing 30% landing fee rebate for scheduled freighter operations for another year to March 31, 2017. In total, these measures for 2016-2017 will amount to about SGD14 million (US$10 million).
Air cargo demand has been subdued by a tough global economic environment, feeble world trade, and a slowdown in China’s economy. Consequently, global airfreight volumes experienced a modest growth of 2.2% in 2015, a slower rate compared to 2014, with all major regions recording weakness in airfreight traffic.
Lim Ching Kiat, senior vice president for market development of CAG, said: “The soft industry outlook is likely to continue in 2016, due to continued headwinds brought about by weaker economic conditions and slowing global trade. In light of the trying business conditions, we are committed to support our cargo partners through these difficult times. Amid the challenges, we hope that CAG’s package of support measures for our cargo partners will serve as a source of optimism.”
Changi Airport is among the world’s top 10 airports for international airfreight movements. In 2015, it handled 1.85 million tonnes of cargo, a 0.5% growth year-on-year, with the growth of transhipment volumes outweighing lower import and export volumes. During the year, the addition of three freighter airlines–My Indo Airlines, Polar Air Cargo, and AirBridgeCargo–enhanced Changi’s cargo network. Pharmaceuticals was one of the best performing cargo segments at Changi Airport last year, growing 45% year-on-year, albeit from a small base.
HKIA, Cathay Pacific disclose January figures
In other developments, cargo volume at Hong Kong International Airport (HKIA) marked growth of 1.5% in January to reach 361,000 tonnes year-on-year.
The expansion was mainly attributed to 3% year-on-year growth in both exports and transshipments. During the month, cargo throughput to and from key trading regions in Australasia and Europe grew most significantly compared to other key regions.
On a rolling 12-month basis, cargo throughput rose 0.1% year-on-year to 4.4 million tonnes.
Meanwhile, Hong Kong-based Cathay Pacific Airways said sister airlines Cathay Pacific and Dragonair traffic recorded only a marginal rise in the volume of cargo and mail uplifted in January compared to the same period last year.
A total of 147,690 tonnes of cargo and mail were lifted last month, a 0.3% increase year-on-year. The cargo and mail load factor fell by 1.8 percentage points to 61.6%. Capacity, measured in available cargo/mail tonne kilometers, was up by 2.4% while cargo and mail revenue tonne kilometers flown decreased by 0.5%.
Cathay Pacific general manager of cargo sales and marketing Mark Sutch said: “We saw a falloff in airfreight demand after the end-of-year peak and we reduced the number of freighter services operated accordingly.”
He added that demand on the key trans-Pacific routes was “solid,” with continued strong cargo traffic to and from India.
But while the January result was boosted by a surge in shipments towards the end of the month in advance of the Chinese New Year holiday, “rate-cutting as a result of overcapacity continued to put significant pressure on cargo yield,” he said.
AAT gains new client
On the other hand, Asia Airfreight Terminal (AAT), the second cargo terminal handler at HKIA, announced that Malindo Air has appointed the company its cargo ground handling agent for cargo and documentation services at HKIA with effect from February 5, 2016.
Malindo Air, established in 2012, is a low-cost airline that is based in Malaysia with headquarters in Petaling Jaya, Selangor, and that operates centrally from its hubs at Kuala Lumpur International Airport and Sultan Abdul Aziz Shah Airport in Selangor. Malindo Air launched the first direct flight to Hong Kong from Kuala Lumpur on February 5 this year, initially operating daily flights with B737 aircraft.
Photo courtesy of CAG
