AIR FREIGHT MARKET OUTLOOK

Freight rates out of China continued their decrease last week, putting further pressure on the use of passenger-freighter flights.

The latest figures from TAC Index show that average rates from Shanghai to Europe last week declined by 30.8% week on week.

Prices are far below the peak recorded just five weeks ago, but remain 51% up on this time last year.

Elsewhere rate declines began to show signs of stabilizing.

Prices from Shanghai to North America dropped 6.3% week on week, while from Hong Kong to North America there was an increase of 4.3% on a week earlier.

From Hong Kong to Europe prices fell by 4.1% week on week.

Meanwhile, airlines are continuing to reduce their use of cargo-only passenger flights as regular passenger operations re-start and rate declines put pressure on the profitability of such services.

On the capacity front, cargo space is around 25% lower than a year ago according to Accenture’s Seabury Consulting.

Capacity on the transpacific is actually 3% up on a year ago, while from Asia Pacific to Europe it is down by 17%.

Airbus announced plans to adjust its global workforce and resize its commercial aircraft activity in response to the Covid-19 crisis.

This adaptation should lead to a reduction of around 15,000 jobs, including 5,000 jobs in France, by summer 2021 at the latest.

Commercial aircraft activity has dropped nearly 40% in recent months as the industry faces an unprecedented crisis.

Commercial aircraft production rates have been adjusted accordingly. Airbus says it is grateful for the government support that has enabled the company to limit these necessary accommodations.

However, since air traffic should not return to its pre-Covid level before 2023 and potentially until 2025, Airbus must now take additional measures to reflect the outlook for the industry after Covid-19, said the aeronautical group.

AFG alternatives:

Asteelflash consol box from Hong Kong to Europe is working normally. There are charter flights out of China to Europe and USA (price upon request) and vice versa with our Global Approved Carriers. There are charter flights out of Europe to USA and vice versa (price upon request) with our Global Approved Carriers

There is also the rail road alternative from Asia to Europe.