Abu Dhabi, UAEWednesday 5 August 2020

Air freight demand plummets in April as Covid-19 affects travel

Slowdown in aviation has hit global supply chains, meaning longer shipping times and higher costs

International Air Transport Association (IATA) director general and chief executive Alexandre de Juniac. Reuters. 
International Air Transport Association (IATA) director general and chief executive Alexandre de Juniac. Reuters. 

Global air freight demand decreased 27.7 per cent year-on-year in April, the sharpest fall ever recorded, as countries imposed restrictions on travel during the coronavirus pandemic, according to the new data from the International Air Transport Association.

Capacity also shrank due to the loss of belly cargo operations on passenger aircraft.

“There is a severe capacity crunch in air cargo. Demand fell by 27.7 per cent compared to April 2019, but capacity was down 42 per cent because of the sharp cuts in passenger operations which also carry cargo,” Alexandre de Juniac, Iata's director-general and chief executive said in a statement on Wednesday.

“The result is damaging global supply chains with longer shipping times and higher costs. Airlines are deploying as much capacity as possible, including special charter operations and the temporary use of passenger cabins for cargo.”

Latin American carriers posted the sharpest fall—a 38.9 per cent year-on-year decline in international demand, followed by Middle East airlines at 36.2 per cent, European carriers at 33.8 per cent and Asia Pacific airlines at 28.1 per cent.

African airlines saw demand drop by 20.9 per cent in April and North American carriers reported a fall in international demand of 20.1 per cent year-on-year, which was the smallest contraction of any region.

While a significant drop, the decline experienced by North American carriers is not as steep as that witnessed at the height of the global financial crisis in April 2009 when demand dropped 32.3 per cent.

“Governments need to continue to ensure that vital supply lines remain open and efficient. While many have responded with speed and clarity to facilitate the movement of cargo, red-tape—particularly in Africa and Latin America—is preventing the industry from flexibly deploying aircraft to meet the demands of the pandemic and the global economy,” Mr de Juniac said.

Airlines have been hit hard by the coronavirus crisis. The pandemic has decimated air travel demand, leading to the suspension of passenger flights and the grounding of more than half the world's fleet.

Global airlines are expected to lose $314 billion (Dh1.15 trillion) in passenger revenue this year, a 55 per cent drop from 2019 due to the pandemic, Iata said in April.

Some airlines have declared bankruptcy, while others have secured large bailout packages as carriers across the world shed jobs and shelve new plane orders in a bid to reduce costs.

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