Outlook increasingly positive as profit margins widen

Outlook increasingly positive as profit margins widen

Airline head of cargo are increasingly positive about the demand outlook for the year as loads continue to recover, freighter utilisation increases and profit margins widen.

In the Cargo Chartbook Q2 2017, the International Air Transport Association (IATA) reports that freight tonne kilometres (FTK) “remained robust” in the three months ending April 2017 and airline heads of cargo were feeling positive about the outlook.

IATA says: “Global economic conditions have improved since mid-2016, including on the consumer side. The trade backdrop has strengthened too, particularly in so-called emerging economies.”

An additional 5,200 tonnes of capacity has been added to fleets in the first half of 2017, mostly passenger belly capacity, about eight per cent lower than the 5,700 tonnes added in the first half of 2016.

Yields have risen 4.5 per cent in seasonally adjusted terms since mid-2016, with crude oil prices 10 per cent lower than a year ago, lowering the breakeven cargo load factor.

IATA says cargo throughput increased at double-digit annual paces at key airports, with Shanghai Pudong International Airport up 13 per cent in May, followed by Hong Kong International Airport at 12.9 per cent and Singapore Changi Airport at 12.6 per cent.

The Middle East remained soft in April, the newest figures available with Dubai International Airport up 1.9 per cent and Abu Dhabi International Airport falling 14.4 per cent.

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