Entry of shipping lines into air cargo market has little impact
Major shipping lines like Maersk and CMA CGM have entered the intercontinental air cargo market, but measured by capacity, at 0.1%, this has only had a very small impact. This is according to a presentation at the recent TIACA Air Cargo Forum by Sander Schuringa, Commercial Director of aviation consultancy Accenture’s Seabury Cargo. According to Schuringa, container shipping companies have doubled their air cargo capacity since the beginning of the year, but this is disproportionate to the expansion of integrators such as UPS, FedEx and DHL, which have increased capacity fivefold.
Schuringa also points out that the corona crisis is still deeply affecting the global air cargo market. For instance, 63% of the world’s intercontinental capacity is now served by cargo aircraft, compared to 50% in 2019. It shows that airlines, which just three years ago accounted for 50% of available cargo capacity. A sign that airlines with belly space on the passenger fleet, which three years ago also accounted for 50% of available cargo capacity, have yet to recapture their former market share. A detailed analysis of the underlying figures by Seabury’s manager further shows that traditional air cargo carriers have 9% more cargo capacity compared to pre-Corona 2019. However, the above integrators managed to expand cargo capacity by nearly 30% in the same time frame. Compared to 3 years ago, belly space on passenger aircraft yielded 29% less, Schuringa said.
Schuringa did not disclose current volumes for October, but a significant drop in demand in the air cargo market (-5%) since August this year has led to a drop in sales. For instance, cargo volumes from Asia to North America rose 15% this month, while shipments from the Far East to key European destinations fell 9%. As a result, according to the Seabury manager, available capacity has grown faster than cargo supply since August, leading to lower load factors and lower price levels. The only market still showing volume growth in August was the transatlantic market, with a 10% increase from Europe and 3% from the US to Europe.