IATA expects strong post-pandemic air cargo market
IATA is predicting a positive outlook for air cargo demand and believes it will continue to improve as the vaccine rollout progresses and bellyhold services pick up.
At a recent press conference, IATA director general, Willie Walsh, said airlines “deserve great credit” for pivoting their business focus away from passenger operations and towards airfreight in a short period of time.
Noting the use of preighters, Walsh said: “Airlines demonstrated great agility in responding to demand to ensure that there was sufficient supply to meet critical supply chain issues during the pandemic.”
He added that as passenger services pick up while the global vaccine rollout progresses, airlines will “shift from survival mode to rebuilding”.
Speaking about the market outlook, Brian Pearce, chief economist at IATA, said air cargo’s recovery from the pandemic is “good” and airfreight services remain in strong demand.
Pearce said: “Shippers and companies need air cargo to rapidly transport components and final products to market as the global economy recovers. This has had a positive impact on the cargo tonne km (CTK) flow.”
However, recovery is not equally strong on all trade lanes, he added.
Pearce also observed that over the last year load factors have been high — some 10 percentage points higher than they normally have been.
“There has been a severe capacity shortage in the industry because typically 50% or so of cargo would be carried in the holds of passenger aircraft,” said Pearce. “Travel restrictions have led to very high loads on aircraft that have been able to fly.”
This has resulted in higher yields, as Pearce noted: “That’s clearly benefited the revenues of the airlines operating in that business, as well as the ones that have pivoted to that business.”
However, IATA believes that high load factors and high yields are probably going to be temporary.