Leeham News and Analysis
There's more to real news than a news release.
Leeham News and Analysis
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Air freight continues to lag, IATA says
March 18, 2016: The air cargo market continues to struggle, according to data compiled by the International Air Transport Assn. (IATA) in its first quarter report for information primarily in the fourth quarter and full year of 2015.
Freight capacity in the bellies of passenger airliners far outstripped main-deck cargo capacity, IATA reports. Load factors for main deck freighters continue to hover in the low 40% range, IATA data shows, extending a long trend. But capacity was also added during the period as freighters emerged from storage, adding to global capacity.
Click on image to enlarge. Source: IATA.
“In-service payload capacity for widebody freighters increased for the fourth consecutive quarter,” IATA reports. “The increase is explained by a reduction of in-storage capacity and delivery of new aircraft. In-storage capacity remains at levels comparable to historical highs but has reduced as aircraft have come out of storage. The pace of retirement of older aircraft has continued to slow, with retirements of only two aircraft in 2015Q4.”
IATA coined a new phrase, “new mediocre,” to describe the current state of the market.
“Global growth continued to grow below its potential–“new mediocre” growth is now the reality,” IATA wrote.
Lower oil prices brought freighters out of storage, adding to capacity but putting pressure on yields.
The full document is here.
AW: “Global growth continued to grow below its potential–“new mediocre” growth is now the reality,” IATA wrote.
– There is global growth in air cargo on one side and global growth in the world economy on the other. Now, are the two correlated or does air cargo has it’s own distinct evolution that would depend on other factors than the economy? I know there is a direct correlation between maritime cargo and the world economy but I am not so sure about air cargo. Perhaps this is due to the fact that air cargo is split in two different businesses: main-deck cargo and belly of passenger planes cargo. My view on this is that in order to have a better understanding of the global air cargo market the two businesses should be added together in one set of numbers to better correlate with the world economy. Of course it is also important to have separate figures for the two air cargo businesses so that we can see in what direction each is going, because they seem to be competing with each other for business.
You are trying to draw together strings in a bow that dont need to meet. The aircargo market is so diverse , one of the most common high value items are aircraft parts, or even low value live goats from Australia to Middle east.
My guess for the lack of growth is that computer and electronics sales have plateaued. So no need for big screen TVs go by air freight, and growth in tablets which are smaller volume and lighter than PCs.
A Strong Lead For Boeing On The Freighter Market.
http://seekingalpha.com/article/3938966-strong-lead-boeing-freighter-market
Fighting that lead is low on Leahy’s priority list. Todays freighters are twins with passengers sitting on top of the containers..
.. & someone got that right 45 yrs ago.
https://upload.wikimedia.org/wikipedia/commons/e/e8/Airbus_A300_cross_section.jpg
Why the A330neo will live long and prosper.
Besides – the 2-4-2 seating wasn’t the worst idea either.
Really? As I recall Airbus has an A330F that does not sell. They must have thought there was a market there.
We can mention the A380F debacle.
It may no longer be a great market for Boeing, but they have done well in it.
Situationaly they will still do well with FedEx extending the 767F.
And Fedex buying a 10-12 767Fs a year is doing well? You do know no one else is buying them so far, what does that tell you. Notice you didnt mention 747F. Thats a part of your production facilities just marking time.
Wasn’t so long ago they could have offloaded that production line to Long Beach, or even Palmdale !
But no they were so clever going to North Carolina.
I will read the report tonight when I get home.
Does it break down markets?
Anchorage continues to see a lot of 747F going through, up from the past from what I can see (also a scattering of 777F – excludes FedEx and UPS as they have continued to run their birds through ANC – I am not counting them )