Home » Aviation, Breaking News » Jan air freight down on weak global activity, export orders; passenger growth continues uptick

Global air freight demand decreased 1.8% in January 2019 compared to the same period in 2018, the industry’s worst performance in the last three years, data released by the International Air Transport Association (IATA) showed.

Freight capacity rose by 4.0% year-on-year in January 2019, the eleventh month in a row that capacity growth outstripped demand growth.

Demand for air cargo continues to face significant headwinds. Global economic activity and consumer confidence have weakened. And the Purchasing Managers Index (PMI) for manufacturing and export orders has indicated falling global export orders since September 2018.

“Air cargo markets contracted in January. This is a worsening of a weakening trend that started in mid-2018. Unless protectionist measures and trade tensions diminish there is little prospect of a quick re-bound,” said Alexandre de Juniac, IATA’s director general and CEO.

Only two of six regions reported year-on-year demand growth in January 2019—North America and Africa. Asia-Pacific, Europe and the Middle East all contracted, while Latin America was flat.

Asia-Pacific airlines saw demand for air freight shrink by 3.6% in January year-on-year. Weaker manufacturing conditions for exporters in the region, ongoing trade tensions and a slowing of the Chinese economy impacted the market.

North American airlines posted the fastest growth of any region for the eighth consecutive month in January 2019, with an increase in demand of 3.3% year-on-year. A strong U.S. economy and consumer spending have helped support the demand for air cargo over the past year, benefiting U.S. carriers.

European airlines experienced a contraction in freight demand of 3.1% in January 2019 from a year ago. Weaker manufacturing conditions for exporters and shorter supplier delivery times impacted demand. Trade tensions and uncertainty over Brexit also contributed to weakened demand.

Middle Eastern airlines’ freight volumes contracted 4.5% in January 2019 from the year-ago period. Seasonally adjusted international air cargo demand, which trended upwards for the past three months helped by stronger trade to/from Europe and Asia, has started to decline.

Latin American airlines’ freight demand was flat (0.0%) in January 2019 versus last year. Despite the economic uncertainty in the region, a number of key markets are performing strongly. Freight traffic within South America and between Central and South America grew at a double-digit rate in January. And demand on routes between North and South America also performed well.

African carriers saw freight demand increase by 1.0% in January 2019 year-on-year. Seasonally adjusted air cargo demand has now trended upwards for six months.

Air passenger traffic registers healthy growth

Meanwhile, global passenger traffic rose 6.5% in January 2019 compared to January 2018, the fastest growth in six months, said IATA.

“2019 has started on a positive note, with healthy passenger demand in line with the 10-year trend line. However, market signals are mixed, with indications of weakening business confidence in developed economies and a more nuanced picture across the developing world,” said de Juniac.

International passenger demand rose 6.0% in January year-over-year, which was up from a 5.3% rise in December. All regions recorded growth, led by Europe for a fourth consecutive month.

European carriers’ international traffic climbed 7.7% in January compared to the year-ago period, down from an 8.6% annual increase in December. This moderation likely reflects uncertainty over the region’s economic situation.

Asia-Pacific carriers recorded a demand increase of 7.1% compared to January 2018, solidly above the 5.0% growth in December. Healthy regional growth is being underpinned by rising incomes and an increase in the number of airport pairs.

Middle East carriers had the weakest growth, with demand up just 1.5% compared to January 2018. Nevertheless, this still was improved over a 0.1% drop in traffic in December.

North American airlines experienced a 4.7% traffic rise over a year ago, improved from a 3.7% annual rise the month before. Demand is being supported by comparatively strong economic conditions which have delivered a low unemployment rate and bolstered consumer spending.

Latin American airlines’ traffic climbed 5.8% in January compared to January 2018. Although this represented a slight softening compared to the growth in December of 6.1%, signs are that passenger volumes have accelerated a little in recent months.

African airlines saw January traffic rise 5.1%, up from 3.8% in December. Concerns continue about the region’s largest economies, South Africa and Nigeria, however.

On the other hand, domestic traffic climbed 7.3% in January year-on-year, the fastest pace since August and up from 5.6% growth in December. All markets showed growth, with China, India and Russia posting double-digit annual increases.

Photo: energepic.com

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