Home » Aviation, Breaking News » Asia air freight feels US-China trade war pressure

The intensifying U.S.-China trade war has been putting pressure on the air freight industry, particularly in the Asia-Pacific region, as global volumes continued to decline in March, according to data from Airports Council International (ACI) World.

ACI said the global air freight sector lost 1% in March year-over-year and finished the first quarter of 2019 with a 2.1% decline in volumes.

On the other hand, the passenger market continued to post positive figures in March, ending the quarter with 4.1% growth at the global level, which was below the industry’s 5.3% growth on a 12-month rolling average.

“A sudden reignition of the trade war between the United States and China, as well as increasing tensions with Iran, [is] starting to put significant pressure on the air freight industry which is already affected by the volatility in the global economy,” ACI World director general Angela Gittens said.

“Passenger traffic has remained comparatively resilient but the slight moderation in growth has continued since it emerged in mid-2018.”

In March, international freight regained some of its momentum from its 6.7% decline in February, only falling 1.3%. First-quarter 2019 results for the segment remained in the negative, contracting 3.2% against 2018. Domestic freight fared better, standing at 0.1% for the quarter due to the strength of the North American market, which grew 0.5%.

Asia-Pacific’s air transport sector has been under pressure from the ongoing trade war between China and the United States and resulting disruptions in a number of industries’ supply chains. Air freight declined 3.3% in March, and Q1 2019 results stood at -5.5%. Both domestic and international freight posted similarly negative figures in the region.

Europe posted growth in March, gaining 0.4%. End-of-quarter growth remained in the negative, down 1.5%, driven down by falling international freight.

North America barely entered a decline in March, losing 0.1% against last year. Q1 results remained positive at 0.8% despite losses of 1.8% in international freight.

Latin America-Caribbean freight traffic also declined in March, by 1.5%. The region’s end-of-quarter result was -0.9%. Africa and the Middle East were the only regions with freight growth in March, gaining 1.5% and 2.1%, respectively.

Meanwhile the international passenger market experienced a slowdown in traffic in March, growing by 3.9% year-over-year compared to 4.8% in February. End-of-quarter growth stood at 4.8%. The domestic market gained some momentum, rising by 3.4% compared to 3.1% last month. Its Q1 2019 growth rate remained below the international segment, at 3.7%.

Asia-Pacific, which has been the largest engine of growth for the industry in recent years, is showing the effects of global headwinds. The region grew 2% in March, with end-of-quarter results reaching 3.4% year-to-date. The international passenger market propped up those results in March, at 3.4%, while the domestic market only gained 1.3%.

North America grew by 4.6% in March, ending the quarter with 4.1% gain year-to-date. Both domestic and international markets fared well during the period, posting 4.4% and 4.6%, respectively.

Europe was close behind with 4% growth year-over-year, though its Q1 result was higher, at 4.5%. The region’s international passenger market slowed down compared to February, posting 4.4% in March against 5.9% for the month prior. The segment’s Q1 results were more than twice that of the domestic segment, at 5.3% versus 2.5%.

In a continuation of the past months’ trend, Africa and Latin America-Caribbean posted fairly robust growth in March, gaining 7% and 5.7%, respectively. Q1 results were in line with those numbers, with Africa growing by 7.1% and Latin America-Caribbean gaining 6.1%.

The Middle East was the only region without growth in March, declining by 0.3%, but Q1 results remained above zero, with a 1.1% gain over the period. A continuation of ongoing geopolitical trends—the Qatari diplomatic crisis and tensions between major regional players and some Western nations—is having an impact on the region’s traffic.

Photo: PublicDomainPictures

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