The International Air Transport Association (IATA) released full year 2019 data for global air freight markets showing that demand, measured in freight tonne kilometres (FTKs), fell by 3.3% compared to 2018 while capacity (AFTK) rose by 2.1%. This was the first year of declining freight volumes since 2012, and the weakest performance since the global financial crisis in 2009 (when air freight markets contracted by 9.7%).
In the month of December, cargo volumes contracted 2.7% year-on-year while capacity rose 2.8%. Air cargo’s performance in 2019 was dampened by weak growth in global trade of just 0.9%.
The sector’s underperformance was also in particular due to slowing GDP growth in manufacturing-intensive economies. Softer business and consumer confidence, along with falling export orders, also contributed to air freight struggles.
There are signs that confidence and orders could pick up in 2020. It is too early to say what long-term effects will be seen from the impact of restrictions associated with combatting the coronavirus outbreak.
“Trade tensions are at the root of the worst year for air cargo since the end of the global financial crisis in 2009. While these are easing, there is little relief in that good news as we are in unknown territory with respect to the eventual impact of the coronavirus on the global economy. With all the restrictions being put in place, it will certainly be a drag on economic growth. And, for sure, 2020 will be another challenging year for the air cargo business,” said Alexandre de Juniac, director general and CEO of IATA.