Noting that many in the industry have been talking about the end of the boom, the data analytics company is questioning whether the industry is set for “small dip” or a “slide” into a more modest performance of a world economy which appeared so robust only a few months ago.
Worldwide air cargo yield went down to a level of USD 1.88 in May 2018, 3.0 per cent below April 2018, but still 14 per cent higher than in May 2017, WorldACD said in its latest update. Measured in Euro’s, the yield increased by 1.0 per cent month-over-month (MoM), whilst the year-over-year (YoY) increase was 7.0 per cent.
The development in air cargo in the month of May 2018 confirms a downward growth trend noticed since the start of this year, it said. But growth it is nonetheless, although less than in 2017.
Year-over-year, air cargo volume increased by 2.6 per cent worldwide, yield growth measured in EUR was up 7.1 per cent and measured in USD up by 14.4 per cent. For January through May, the growth was 4.3 per cent.
The origins Chile (+58 per cent), Japan (+18 per cent), Canada (+17 per cent), and the US (+5.8 per cent) easily outperformed many other countries, WorldACD noted. But the growth from the Americas came at a price, it added: YoY USD-yield improvements in the Americas were well below 10 per cent, much lower than elsewhere in the world.
The origins India, Russia and Western Europe all showed negative YoY growth in May. As in previous months, long haul traffic increased more than short haul (3.0 per cent growth in Direct Tonne Kilometres, DTKs, vs. 2.6 per cent growth in weight), while specific cargo categories again outpaced general cargo (5.5 per cent vs 1.5 per cent growth respectively).
“Yet, the fear of growing protectionism is real, and that fear may well play a role in a shift away from consumption. Will the whole world suffer? To what extent will some regions feel the heat of the trade war (mongering) more than others?,” WorldACD analysts asked.
While impossible to tell at this point, WorldACD pointed to the performance of a number of large economies for a clearer view. The analysts looked at GDP-developments, as reported by The Economist in its latest issue, relative to air cargo growth. “Until 2009, the conventional wisdom was that air cargo roughly grew at twice the rate of GDP-growth. Since the crisis this ratio first dropped from 2:1 to 1:1 and then climbed again gradually. Where does it stand today?,” they asked.
From the table below WorldACD highlights it is no longer possible to use a general ratio between GDP-growth and air cargo growth. “Neither is it possible to assume that growth in any geographical area will ‘automatically’ benefit the carriers based in that area.
“Actually, the contrary appeared to be the case when reviewing growth over the past two years,” the analytics company said. The African carrier group was the only one improving its (small) market share in all regions. So did carriers from Asia Pacific, except in their home area. Carriers from the Americas increased their market share in three regions, but lost share in both North and South America.
The group of Middle Eastern carriers lost share in three regions, including their home area, and gained in Europe and Latin America. Lastly, the group of European carriers gained share everywhere, except in their home market Europe,” WorldACD said. “In other words, the growth in traffic from all areas except Africa, benefited the group of ‘non-home carriers’ more than the group of ‘home carriers’,” it added.