Consultant Insight: International airfreight in peril

[caption id="attachment_69752" align="alignright" width="298"] Cathy Roberson, Cargo Facts Consulting senior consultant and Air Cargo World columnist[/caption] Tariffs, Hong Kong and COVID-19 have amplified political relations between China and the U.S. There has never been much warmth between the two countries, and the latest concern involving passenger airlines further contributes to the icy relations between them. In March, China’s aviation regulator, Civil Aviation Authority of China (CAAC), halted international passenger airlines into China because of the pandemic. Meanwhile, Chinese airlines continued to fly to the U.S. Delta and United have recently sought to resume flights to China but have not received a response from the CAAC, according to reports from The New York Times . The U.S. government stepped in and announced that it would bar Chinese airlines from serving U.S. airports beginning June 16. In response, Chinese officials announced that foreign passenger airlines would be allowed to choose one Chinese city from an approved list to operate one flight each week, beginning June 8. The CAAC further said that all airlines would be able to increase the number of international flights involving China to two per week if none of their passengers test positive for COVID-19 for three consecutive weeks. If five or more passengers on one flight test positive upon arrival, the CAAC will bar the airline for a week. Airlines would be suspended for four weeks if 10 or more passengers test positive. In response to China’s latest announcement, the U.S. government said Chinese carriers could operate “the same number of scheduled passenger flights as the Chinese government allows ours.” As noted by Reuters , the U.S. order would halt such flights as the four weekly U.S. roundtrip flights by Air China, China Eastern Airlines, China Southern Airlines and Xiamen Airlines. While this latest spat does not include cargo carriers, it does impact cargo. According to analysis from Cargo Facts Consulting , approximately 29% of total air cargo between the U.S. and Northeast Asia is carried by U.S. passenger airlines. Overall, passenger airlines carried 382,000 tonnes westbound and 783,000 eastbound in 2019. Of the total volumes, Chinese passenger airlines carried 100,000 tonnes eastbound and 50,000 tonnes westbound. Capacity is already a concern. Globally, capacity in terms of available cargo tonne kilometers (ACTK) is down over 40% year over year, according to IATA , due primarily to sharp cuts in cargo-carrying passenger operations. In April, ACTK were down 48.3% for Asia-Pacific airlines, and down 26.4% for North American airlines. Limiting capacity further will be detrimental to the airline industry. Already reeling from cargo declines before the pandemic, the industry has seen shifts from air to ocean freight, as well as to rail between Asia and Europe. Options continue to grow for shippers. For example, shipping integrator ZIM recently announced the launch of Speedy ZIM eCommerce Xpress, a fast, new, dedicated ocean service from South China to Los Angeles. With a transit time of 12 days, the service caters to e-commerce customers and includes the possibility of a combined sea-air freight solution. Meanwhile, freight forwarder Expeditors International of Washington has touted its own express ocean service. We’ve written of the shift from air to other modes of transportation due to air capacity constraints during the pandemic, but what will the international air cargo market look like post-pandemic? Will it still play a vital role? Will shifts to other modes of transportation stick? Or will it continue to be held captive for political gains?

Consultant Insight: International airfreight in peril

Drone Delivery Canada, GlobalMedic partner to deliver aid in response to pandemic

Battery shipping loophole exposed by FedEx fire, NTSB warns

Related Posts

American Airlines reports 29% increase in Q3 cargo revenue

Amazon’s first owned A330 freighter awaits Hawaiian operation in Honolulu

United sets Q3 company record for most cargo carried

Battery shipping loophole exposed by FedEx fire, NTSB warns

Cargo Facts Free Newsletters

Cargo Facts Connect Podcast

Follow Us

Welcome Back!

Retrieve your password