Hongkong Post has warned of air freight capacity shortages to Europe from the region that couldlead to delays to outbound shipments, as a result of recent flight cancellations.
A number of air freight operators have responded to the decline in demand in the second half oflast year by reducing their freighter frequencies and capacity, with one major freighter operatorfrom the region, Jade Cargo International, suspending all of its flights completely.
Hongkong Post said: “Due to the recent cancellation of flights to the European countries, thereis insufficient air cargo space to meet with postal demand. Air mail services – including Speedpost– from Hong Kong to European destinations may be subject to delay.” The postal operator said thissituation was expected to remain until further notice.
Jade Cargo International, based in nearby Shenzhen, suspended operation of its six B747freighters on 31 December, “due to overall weak air cargo demand”, although the carrier said thesuspension would also give the airline the opportunity to restructure its financing. It originallyhoped to resume flights on 16 January, but said that “ongoing discussions concerning the financialrestructuring” meant that its flights would remain suspended until further notice.
Hong Kong carriers Cathay Pacific and Dragonair are understood to have also cut back some oftheir capacity this month, following a challenging second half of 2011 that continued intoDecember, although CEP-Research was unable to confirm this at the time of writing. Cargo and mailtonne kilometres in December were down by 9%, year on year, while capacity was up by 3.9%, causingcargo and mail load factor to decline by 9.6 percentage points in December to 67.8%. For the yearas whole, tonnage dropped by 8.6% compared to a capacity increase of 6.9%.
Major global express operators TNT, FedEx, and UPS all reduced their air express capacity fromAsia in the second half of last year, due to weakening demand, although it was unclear at the timeof writing whether they had since brought some of this capacity back online. DHL retained the levelof its Asia-Europe capacity during the second half of 2011, and had increased it on certain lanes,but was unable to provide information on current demand and capacity issues because it is currentlyin a financial-reporting ‘quiet period’.
Preliminary figures from the Association of Asia Pacific Airlines (AAPA) indicated thatinternational air cargo demand among Asia Pacific airlines fell by 4.8% in 2011 – “a reflection ofweakening world trade conditions” – following the strong rebound in the preceding year. In spite ofthe decline in freight demand, offered freight capacity matched that of the previous year, leadingto a 3.4 percentage point decline in the average international freight load factor, to 66.6%.
Globally, a downward trend in cargo since the middle of the year meant that cargo is estimatedto have finished the year with a 0.5% contraction in volumes, despite a strong start to 2011.Following a downgrade in December, global airline association IATA expects cargo volumes to be flatin 2012.
