IATA: 2016 'shaping up to be another tough year for air cargo'

IATA reported (04-May-2016) global FTKs decreased 2% year-on-year and AFTKs increased 6.9% in Mar-2016, placing increased pressure on yields. The association said the weak results reflect subdued world trade growth, exaggerated in comparison to a strong start in 2015. IATA director general and CEO Tony Tyler said: "It is shaping up to be another tough year for air cargo...The combination of fierce competition, capacity increases and stagnant demand makes this a very difficult environment in which to generate profits." IATA noted the following regional details:

• Africa: AFTKs for African airlines increased 22.6% in 1Q2016, more than double the rate of any other region in recent months, on the back of long-haul expansion;
• Asia Pacific: Demand was weak in Mar-2016 and was exaggerated by the effects of disruption at US sea ports in 2015. Export volumes from emerging Asian economies contracted in annual terms for 11 of the past 12 months;
• Europe: Weak cargo demand continued with volumes for European carriers just 1% above early 2008 levels. Capacity increased 7.9% in Mar-2016;
• Latin America: Volumes decreased to 15% less than the seasonally-adjusted peak reached in late 2014. Routes within South America were hardest hit, reflecting the regions challenging economic environment, particularly in Brazil;
• Middle East: Demand growth of 2.4% in Mar-2016 was the lowest since Jul-2009, reflecting a slowdown in network expansion by the region's main carriers over the past six months and weak trading conditions;
• North America: Decreased demand was partially due to the effect of US sea port strikes in 2015. The region's carriers were also negatively impacted by a drop in global trade and the strong US dollar maintained pressure on exports. [more - original PR]