Airplanes and results. IATA: freight demand ends year up 3.5%
Despite softening late 2018
The International Air Transport Association (IATA) released full-year 2018 data for global air freight markets showing that demand, measured in freight tonne kilometers (FTKs) grew by 3.5% compared to 2017. This was significantly lower than the extraordinary 9.7% growth recorded in 2017.
Freight capacity, measured in available freight tonne kilometers (AFTKs), rose by 5.4% in 2018, outpacing annual growth in demand. This exerted downward pressure on the load factor but yields proved resilient.
Air cargo’s performance in 2018 was sealed by a softening in demand in December. Year-on-year, December demand decreased by 0.5%. This was the worst performance since March 2016. Freight capacity, however, grew by 3.8%. This was the tenth month in a row that year-on-year capacity growth outstripped demand growth.
International e-commerce grew in 2018 which was a positive factor for the year. Yet, there was a softening of several key demand drivers:
The restocking cycle, during which businesses rapidly built up inventories to meet demand, ended in early 2018;
Global economic activity weakened;
The export order books of all major exporting nations, with the exception of the US, contracted in the second half of 2018;
Consumer confidence weakened compared to very high levels at the beginning of 2018.
Airlines in all regions with the exception of Africa reported an annual increase in demand in 2018.
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