Lack of Passenger Flights Squeezes Air Freight Capacity in Peak Season

Increase font  Decrease font Release Date:2020-11-12  Author:Justine  Views:1906
Tips:A sharp fall in passenger flights due to the coronavirus pandemic combined with rising e-commerce demand is setting the stage for tight capacity and a renewed rise in air freight rates heading into the peak Christmas season.

A sharp fall in passenger flights due to the coronavirus pandemic combined with rising e-commerce demand is setting the stage for tight capacity and a renewed rise in air freight rates heading into the peak Christmas season.

Dedicated air freighters are flying more hours of the day than usual to help make up for the decline in passenger belly space and some airlines are running "ghost flights" without passengers due to attractive cargo rates, but capacity and demand remain mismatched, according to industry experts.

"There is a 20% gap on the capacity front," said Marco Bloemen, cargo advisory lead at Accenture's Seabury Consulting, comparing capacity to last year. "Flights are very full on most freight lanes."

The limited capacity and higher rates mean more expensive technology and fashion items would receive higher priority for air shipment than lower value items, he said.

Deutsche Post AG's DHL Express last week said it expected unprecedented online shopping and shipping volumes during the peak season, with shipment quantities 50% above last year.

With demand especially high on trans-Pacific routes, major Asian airlines are also benefiting from strong cargo demand, though it is not enough to offset lost passenger revenue.

Cathay Pacific Airways Ltd said last month it was already operating at peak season levels, havin stepped up services on trans-Pacific routes and added cargo-only passenger flights to meet strong demand.

China Airlines Ltd said it was using its freighters as much as possible, taking delivery of new freighters and adding charter flights and passenger flights for cargo to meet demand triggered by electronics launches and an e-commerce "shopping frenzy".

The rising demand has led to a renewed climb in air freight rates, which peaked in April and May at a time when passenger capacity bottomed and there was unprecedented demand for masks and other protective gear.

 
 

 
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