Consumer Spending Shift and Rising Prices Impact Asia Pacific Air Cargo Demand

A shift in consumer spending from goods to services and higher prices were partly to blame for an air cargo demand decline amongst Asia Pacific airlines in June.

Preliminary June 2023 traffic figures released by the Association of Asia Pacific Airlines (AAPA) found air cargo demand, as measured in freight tonne kilometres (FTK), declined by 8.1% year on year.

Capacity rose by 0.7%, leading to a 5.9 percentage point fall in the average international freight load factor to 60.7% for the month.

Meanwhile, global trade activity was muted with the ongoing declines in new export orders, said the AAPA. The easing in container shipping rates relative to air freight rates further discouraged demand for air shipments.

Subhas Menon, AAPA director general said: “In the first half of the year, the number of international passengers carried by Asian airlines quadrupled to a combined total of 120 million, boosted by the upsurge in leisure and business travel demand, as the region’s economies emerge strongly from the pandemic.”

“During the same period, the region’s carriers posted a 10% decline in air cargo demand. A myriad of factors, including a post-pandemic shift in spending from goods to services and higher merchandise prices, weighed on global air cargo markets.”