Release Date: 20 April 2010
Release ID: 4649
Global Forwarding division shares Asia demand to fuel growth
Beijing, 20 April 2010: DHL, the world’s leading logistics company, is taking measures to boost air freight capacity in its freight forwarding division to cater to increasing airfreight demand from Asia. The company today shared that it has enlarged its Airfreight Network that spans Africa, Asia Pacific, Europe, Middle East and the Americas by adding additional consolidation services into Middle East and Africa and increasing the number of gateways. Additional measures have also been taken to enhance block space and part charter agreements with commercial passenger and pure cargo carriers.
”Demand for airfreight was the first to turn up amid the global economic recovery, driven by businesses restocking their inventories. Airfreight has risen back to levels before the economic crisis. On top of it, full ships and shortage of containers out of Asia forced some shippers to switch part of their goods from ocean- to airfreight,” said Charles Kaufmann, CEO North Asia & Senior Vice President, Air Freight, North Asia Pacific, DHL Global Forwarding. Kaufmann shared insights at the 7th China Air Cargo Summit held in Beijing where he participated as a guest speaker.
“Based on our outlook for the year, we’re taking the necessary measures to bolster our airfreight capacity - increasing the number of block space agreements on commercial carriers and maintaining strong collaboration with Chinese national carriers,” said Kelvin Leung, CEO, DHL Global Forwarding North Asia Pacific. “Trade lanes from Asia have seen a strong rebound in exports. Freight volume rose by 95% in January and has now recovered to pre-crisis levels. As the world’s second-largest economy, China will fuel the airfreight growth, with freight volumes carried by Chinese airlines expected to see double digit growth this year.”
Asia to Lead Air Freight Volume Growth
Asia will lead the global airfreight recovery as the majority of the airfreight takes place or originates in the region. China, in particular, will be a key factor for growth. Intra-Asia trade is forecasted to grow at 6.2% CAGR fuelled by the increase in Chinese consumption and increasing intra-Asia trade with China. Similarly, air cargo volumes between North America and China are expected to grow 8.0% CAGR between 2010-2019, and 6.8% CAGAR for the same period between Western Europe and China. Excluding China, CAGR growth of air cargo volumes between rest of Asia and North America is projected at 5.4%, and 5.2% for air cargo growth volumes between Western Europe and Asia during the same period.
Over 85% of Westbound commodities from US to China are goods related to manufacturing and production including chemicals, machinery and intermediary goods - leathers and oils. Nearly 90% of all exports from China to North America are consumer products including electronics, apparel, footwear and toys.
Based on comparison of Freight-Tonne-Kilometers (FTKs) over the past 12 months, overall airfreight volumes increased 28.3%, of which, 60% of the volume increase was carried by Asia Pacific airlines.
“While airfreight volumes continue on an upward trend, airfreight operators, particularly in Asia, will cautiously plan their flights and cargo capacity in the market, to avoid an oversupply. The imbalance of the supply and demand will continue into Q2 and Q3 this year. Thus, the main challenge for us in the coming months is to acquire sufficient capacity at reasonable cost to fulfill customers’ demand for our airfreight services,” Kaufmann added.
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