May 17, 2020

IATA records weakening air freight markets in March

IATA
Air
freight
air cargo
Freddie Pierce
3 min
Global Freight Tonne Kilometers were down 2.3% in March
Air freight markets weakened in March, according to IATA, as the improvement in air cargo growth rates that began at the end of 2012 stalled. Global Fr...

Air freight markets weakened in March, according to IATA, as the improvement in air cargo growth rates that began at the end of 2012 stalled.

Global Freight Tonne Kilometers (FTKs) were down 2.3 percent in March compared to March 2012, with only the Middle East and Africa showing an expansion. Asia-Pacific carriers, which comprise 38.5 percent of the market, experienced a 3.3 percent fall compared to the previous year - this region showed the greatest weakness in terms of actual freight volumes. The US and Europe, however had larger percentage falls (5.2 percent and 4.0 percent respectively), but on a smaller market share. 

Global air freight volumes are now only 1.5 percent above the October 2012 low point, down from the 3.5 percent rise that had been reached in January.

“The March decline in air cargo is most likely a temporary stall. The fundamentals for a sustained improvement in air cargo volumes are in place. Business confidence continues to signal forthcoming expansion, and the solid increase in new export orders seen in 2013 should boost air freight in the coming months. Much of the current weakness is coming from Asia-Pacific airlines. While the region is economically strong, the economies of its trading partners are not. The Eurozone is showing renewed weakness and the negative impact of US budget cuts is yet to be fully measured,” said Tony Tyler, IATA’s Director General and CEO.


Explanation of measurement terms:

FTK: Freight Tonne Kilometers measures actual freight traffic

AFTK: Available Freight Tonne Kilometers measures available total freight capacity

FLF: Freight Load Factor is % of AFTKs used

Regional highlights

After adjusting for seasonal factors, it is clear that the improving trend witnessed in the fourth quarter of 2012 has been reversed. The global load factor slipped marginally to 46.7 percent, and capacity fell by 0.3 percent.

Asia-Pacific carriers saw cargo traffic fall 3.3 percent compared to March 2012. Airlines in the region have experienced most of the weakness in the global trend, with a 3 percent drop in volumes in March compared to January this year. Although regional indicators are still solid, major trade partners in Europe continue to be hampered by economic weakness and sovereign debt problems. Capacity also fell, down 2.8 percent, compared to a year ago.

North American airlines experienced a 5.2 percent decline in demand, the steepest fall of any region. Capacity was reduced by 2.7 percent. While domestic demand has supported regional cargo carriers, routes to Europe have been hit by declines in export markets.

European cargo markets fell 4.0 percent and capacity grew 0.4 percent. Several European confidence indicators declined in March and much of Western Europe remains in or close to recession.

Middle East airlines’ cargo traffic grew 10.5 percent, continuing their remarkable start to 2013. The region has grown 12.4 percent faster for the year to date compared with the same period last year. In March, capacity was up 9.1 percent.

Latin American carriers saw demand fall 0.8 percent while capacity grew 2.6 percent. The underlying economic growth trend in the region is still solid and airlines are maintaining the improvement in demand since late 2012. Export growth to North America and China is supporting international freight routes.

African cargo markets grew 3.2 percent, benefitting from strong growth in regional developing economies. Capacity, however, grew by 10.0% which led to the load factor declining to 25.0 percent, the lowest of all regions. 

 

IATA statistics cover international and domestic scheduled air traffic for IATA member and non-member airlines.

All figures are provisional and represent total reporting at time of publication plus estimates for missing data. Historic figures may be revised.

Total freight traffic market shares by region of carriers in terms of FTK are: Asia-Pacific 38.5%, North America 23.3%, Europe 21.5%, Middle East 12.5%, Latin America 3.1%, Africa 1.2%.

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Jun 17, 2021

Cainiao Network Launches Customer-Centric Logistics

Cainiao
Alibaba
Logistics
Tmall618
3 min
Cainiao will focus on the customer experience in Singapore and Malaysia during its Tmall 618 Mid-Year Shopping Festival

As the logistics division of the Alibaba Group, Cainiao Smart Logistics Network has decided to provide its Southeast Asian customers with unsurpassed service during its annual shopping festival. Based on customer feedback surveys, the company will expand its real-time customer service support and speed up delivery times. ‘By expanding and deepening our services, we aim to provide a stronger logistics infrastructure that can bolster the booming eCommerce sector, support merchants’ expansion into new markets and diversify retail options for consumers’, said Chris Fan, Head of Cross-Border, Singapore, Cainiao Network.

 

Who Is Cainiao? 

According to TIME Magazine, Cainiao ‘is far from a typical logistics firm’. The company controls an open platform that allows it to collaborate with 3,000 logistics partners and 3 million couriers. This means that merchants can choose the least expensive and most efficient shipping options, based on Cainiao’s real-time logistics analytics. The company’s goal is to ship packages anywhere in the world in under 72 hours—and for less than US$3.00. 

 

For countless small business owners around the world, from coffee-growers to textile-weavers, this could change everything. Usually, it costs about US$100 to ship a DHL envelope from Shanghai to London in five days. Cainiao aims to change that. Said its CEO Wan Lin: ‘The biggest barrier to globalisation is logistics’. 

 

What’s Part of the Upgrade? 

Throughout the Tmall festival, Cainiao’s logistics upgrade will be divided into four critical segments: 

 

  • Real-time customer service support. Cainiao has launched a direct WhatsApp channel for customers to receive logistics updates and ask questions. 
  • Expansion of air freight parcel size and weight limits. Packages can now be up to 30 kilograms or 1-metre x 1.6 meters to help ship large items such as furniture. 
  • Daily air and sea freight connections. Shipping frequency will almost double to seven times weekly to maintain resilience and efficiency. 
  • Compensation for lost or damaged packages. Customers will be reimbursed up to RMB 2,000 (US$311). 

 

Where is the Company Headed? 

From June 1st to June 20th, the finale of Tmall, Cainiao will ensure that its customers feel confident in the company’s ability to deliver their packages. Despite global shipping delays due to COVID, the show will go on. Said Fan: ‘This series of customer-centric logistics upgrades reaffirms our goal of pursuing value-added services to enhance customers’ shopping experience while mitigating challenges posed by external factors’. 

 

Furthermore, Cainiao has recently expanded its Southeast Asian operations, achieving revenue growth of 68% year-over-year. In Malaysia, the logistics operation has partnered with BEST Inc. and Yunda; in Singapore, the company has partnered with Roadbull, Park & Parcel, and the Singapore Post. And if its recent measures help retain and grow its customer base, the company will be well-poised to lead the industry in resilient and customer-centric global logistics. ‘COVID-19 made everyone realise how important the logistics infrastructure backbone is’, said Wan. ‘And it gave us a peek at what Cainiao should look like in three years’. 

 

 

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