May 17, 2020

IATA records freight downturn for October

IATA
Air freight
downturn
air traffic
Freddie Pierce
2 min
Air freight declined by 2.2 percent compared to September
Follow @Ella_Copeland The International Air Transport Association (IATA) has recorded a sharp drop in air freight rates for the month of October, down...

The International Air Transport Association (IATA) has recorded a sharp drop in air freight rates for the month of October, down 3.5 percent compared to October 2011.

After being up by 0.9 percent in September, October’s weakness could be in part attributed to Hurricane Sandy, which cancelled a total of 17,000 passenger and freight flights in the most affected airports, according to IATA.

Overall, October freight demand declined 2.2 percent compared to the previous month, whilst the freight load factor weakened to 46.1% from 46.7% a year ago.

The weakness in demand continues to be focused on Asia-Pacific airlines, while Middle East carriers experienced strong demand growth. Airlines reduced freight capacity 0.9% in October compared to September, but this was not sufficient to offset the demand decline with the result that unlike in passenger markets, freight load factors have started to weaken.

Country by country breakdown

Asia-Pacific carriers saw a 6.8% decline in demand in October compared to October 2011, the steepest decline for any region, while capacity fell 4.6%. Between September and October, two-thirds of the fall in global air freight volumes has come from Asia-Pacific carriers, as demand for Asian exports declined in the weak global economy. 

North American airlines had a 5.3% drop in demand, with a 5.4% reduction in capacity. 

European airlines had a 4.3% decline in traffic, with just a 1.7% decline in capacity. Europe’s airlines have seen only a 1% rise in demand since the 2011 fourth quarter.

Middle Eastern carriers’ 13.4% rise in traffic came on an 8.6% rise in capacity, raising load factor 2 percentage points to 46.4%.

Latin American airlines’ demand climbed 0.9% but this was exceeded by an 8.6% hike in capacity that pushed load factor down 3 percentage points to 39.3%.

African carriers saw a 0.5% decline in demand and a 2.7% rise in capacity. Load factor of 26.6% was the weakest for any region.

“Slowing world trade and weak business confidence are affecting demand for air travel, while Hurricane Sandy delivered a concentrated punch to US domestic and North Atlantic travel. And its impact was felt globally,” said Tony Tyler, IATA’s Director General and CEO. “Airlines are managing the softer passenger demand environment by limiting capacity growth to keep load factors high. But the rapid decline in freight traffic is outrunning the industry’s ability to respond.”

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Jul 22, 2021

Uber Freight to Acquire Transplace in $2.2bn Deal

UberFreight
Logistics
supplychain
Acquisition
2 min
Uber Freight’s acquisition of Transplace will supercharge parent Uber’s move into logistics and supply chain

Uber Freight is to acquire logistics technology and solutions provider Transplace in a deal worth $2.25bn. 

The company will pay up to $750m in common stock and the remainder in cash to TPG Capital, Transplace’s private equity owner, pending regulatory approval and closing conditions. 

“This is a significant step forward, not just for Uber Freight but for the entire logistics ecosystem,” said Lior Ron, Head of Uber Freight, and former founder of the Uber-owned trucking start-up Otto.

Uber’s Big Play for Supply Chain


Transplace is one of the world's largest managed transportation and logistics networks, with 62,000 unique users on its platform and $11bn in freight under management. It offers truck brokerage and other capacity solutions, end-to-end visibility on cross border shipments, and a suite of digital solutions and consultancy services. 

The purchase is the latest move by parent company Uber, which launched as a San Francisco cab-hailing app in 2011, to diversify its offering and create new revenue streams in all transport segments.

Transplace said the takeover comes amid a period of “accelerated transformation in logistics”, where globalisation, shipping and transport disruption, and widespread volatility are colliding. 

Uber Freight plans to integrate the Transplace network into its own platform, which connects shippers and carriers in a dashboard that mirroring the intuitive experience found in its consumer vehicle booking and food ordering services. 

“This is an opportunity to bring together complementary best-in-class technology solutions and operational excellence from two premier companies to create an industry-first shipper-to-carrier platform that will transform shippers’ entire supply chains, delivering operational resilience and reducing costs at a time when it matters most,” said Ron. 

Frank McGuigan, CEO of Transplace, said the resulting merger will offer enhanced efficiency and transparency for shippers, and benefits of scale for carriers. “All in all, we expect to significantly reduce shipper and carrier empty miles to the benefit of highway and road infrastructures and the environment,” he added. 
 

History of Uber Freight


Uber Freight was established in 2017 and separated into its own business unit the following year. In 2019 the company had expanded across the entire continental US, established a headquarters in Chicago. Later that year it launched its first international division in Europe, initially from a regional foothold in the Nertherlands, and later moving into Germany. 



The logistics spinoff attracted a $500m investment from New York-based Greenbriar Equity Group in October 2020, and launched a new shipping platform for companies of all sizes in May, partly in response to a driver shortage in Canada.
 

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