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Air freight groups and airlines, which have recently cut flights to China amid weak tourist demand, are rerouting planes out of the country ahead of the Black Friday and Christmas shopping seasons and higher freight rates. Scamming to get cash.
A boom in demand for cheap online goods from Chinese e-commerce groups and increased use of air freight amid disruptions on the Red Sea threaten to overwhelm an already strained express delivery market ahead of Christmas. has been increasing, due to which air freight rates are increasing.
Cargo flying from Asia to the US has picked up, with the average October spot price up 49 percent from a year ago to $5.46 a kilogram, according to market analytics firm Zenita. During the same period, the rate from Asia to Europe increased by 25%.
Demand for air freight grew as China-based e-commerce groups responded to Western consumers’ desire for cheaper goods. Many of their shipments are shipped directly to customers by air, taking advantage of import duty exemptions on shipments below a certain value.
US and EU lawmakers are trying to use the duty “quietly” to stem the flow of imports from China, with the White House proposing to exclude several goods from the exemption in September, while Brussels has € 150 limit has been discussed. What items can be purchased duty free?
Meanwhile, the flow of goods continues unabated, prompting cargo groups to increase flights out of China.
Among the latest moves, Air France-KLM’s cargo subsidiary Martinair will redeploy its Latin American services and launch a new flight between Hong Kong and Amsterdam in September, the first time its aircraft have visited the Chinese city in nine years. have flown to
Tom Owen, director of Cathay Pacific’s cargo division, said 2024 has been the year of e-commerce, particularly from the Chinese mainland. He added that Hong Kong’s airline is investing in additional capacity by 2027 with more freighters.
German delivery group DHL also announced plans in September to invest in eight new Boeing 777 cargo planes as it expected higher demand outside China during the peak season. UPS, which operates more than 360 daily flights, said in October that it was adding 200 trips from Asia to Europe and the US during the fourth quarter, as it expected “volume demand to increase.” Who was
But as carriers prioritize the most profitable flights out of Asia, customers on other routes are feeling the impact.
Danish freight forwarder DSV previously warned that airlines would likely reallocate capacity from the US and Europe to Asia to “take advantage of higher profits”, resulting in reduced capacity on flights between Europe and the US. And there will be a “significant increase in prices”.
In an effort to ease capacity pressures, it began chartering Boeing 777 aircraft in September to fly weekly between Asian transport hub Singapore and Los Angeles.
An executive at another freight forwarder, which connects retailers and airlines, said many flights from Asia have been diverted from the US to Europe. Shorter distances meant that carriers could fly in and out of Asia more frequently and cash in on higher freight rates.
“If you’re not willing to pay the premium, they’re pulling that capacity. They’re willing to renege on commitments, regardless of the promises they made to consumers,” the executive added.
Joyce Tai of shipping platform Fritos warned that smaller freight forwarders may struggle to secure shipments by air, especially during the peak holiday season, resulting in higher prices being passed on to consumers.
Although U.S. President-elect Donald Trump threatened a tougher crackdown on Chinese imports before his election, for this Christmas shopping season, air freight operators see little sign of easing demand and freight rates. are seen
Michael Stein, chief executive of US cargo airline Atlas Air Worldwide, said e-commerce is growing at a rate of about 8 to 9 percent per year.
“Demand continues to grow. . . and we’re going to see that supply doesn’t keep up [over] The next several years,” he said.
