Airlines’ hopes of a peak season boost in November failed to materialize with a year-over-year fall in demand of 1% point. This is the first decline in demand since the road to recovery started six months ago, according to the latest industry statistics from analysts CLIVE Data Services and TAC Index.
From a low of -37% in April, the gap in year-on-year air cargo volumes has been steadily closing in the subsequent months to the end of October, by which time the margin versus 2019 volumes had reduced to -12%. In November, however, the gap rose slightly to -13% as the coronavirus continued to take its toll on global trade and international supply chains.
This validates a signal first identified by CLIVE Data Services in the final week of October 2020 when air cargo’s ‘dynamic load factor’ – calculated on both the volume and weight perspectives of cargo flown and capacity available – unexpectedly slipped by 1.5%.
New data for the four weeks ending 29 November shows that capacity – up 3.0% month-on-month – outpaced demand, with chargeable weight increasing by just 2.5%. Overall, the available capacity was 21% less than a year ago. Consequently, despite rising to 72% in the opening two weeks of November, the dynamic load factor reduced to 70% for the second half of the month which, although 5% points higher year-on-year, was still below the 8% points load factor increase in the month of October 2020.
Commenting on November’s market data, Niall van de Wouw, Managing Director of CLIVE Data Services, said: “We saw a leveling off develop at the end of October which we stated might be indicative of a market which was cooling off a little, and this was indeed the case. After six months of small but encouraging improvements, the stalling of demand in November – typically a peak month when we’d expect dynamic load factor growth – could be seen as a further negative indicator. However, we must contrast this with the impact of lockdowns and restrictions imposed by governments to slow the second wave of Covid, especially in Europe and the US, and the corresponding disruption to business continuity and consumer confidence. Against this uncertain operating environment, the global air cargo market in November arguably showed a degree of resilience.
“The air cargo industry can also take some comfort from the positive news of successful vaccine developments and the global demand shipments of the vaccine will hopefully produce for air cargo supply chains. This will also bring more capacity to the market and hopefully coincide with a rise in consumer spending, which is hopefully a prelude to a more sustainable recovery in 2021.”
Looking at major trade lanes, TAC Index reports airfreight rates in November increased significantly from Hong Kong and China to Europe month-over-month by 30% and 24% respectively, although rates from Hong Kong to both Europe and the United States flattened towards the end of the month and, week-on-week analyses shows China-Europe rates decreasing by around 6% towards the end of November.
Robert Frei, Business Development Director at TAC Index, stated: “This is a fluctuating market. The increase in rates is likely to be the result of airlines selling more capacity on the short-term market and forwarders securing air cargo capacity through charter arrangements. Overall, in November, we did not see the rates one would have expected based on earlier anticipation of a strong peak season.”
World Net Logistics officially became known as Rhenus Logistics South Africa from 1 December 2020. Acquired by the Rhenus Group in 2019, the company now operates under its new name, ushering in an exciting era after 18 years as an independent entity.
The distinctive Rhenus logo and corporate identity is replacing the World Net Logistics branding, reflecting its strengthened positioning as part of the global organization. “We are excited to be fully integrated and a part of the Rhenus Group – with its ‘One Group – One Brand – One Rhenus’ philosophy,” says Dirk Goedhart, Chief Executive Officer of World Net Logistics (now Rhenus Logistics South Africa). “It brings about new opportunities to leverage off the global Rhenus network, giving our clients even greater value and enabling us to pursue our growth strategy.”
The integration of World Net Logistics has been phased in since its acquisition by Rhenus in 2019. “Because of our shared values, similar vision and mission, aligned strategies, and the group’s decentralized structure, the transition from World Net Logistics to Rhenus Logistics South Africa has been seamless,” adds Goedhart. “With the exception of the name change, new logo and new corporate identity, it is still very much business as usual – only better.”
“We continue to focus on our core differentiators, but with the added benefits of a truly global brand,” continues Goedhart. “Our full supply chain services, which include flexible and reliable last-mile deliveries in South Africa through Rhenus Express, is an advantage for all our customers.”
With a history spanning more than 100 years, Rhenus is a growing company that is committed to strengthening its international network.
“The establishment of operations in Southern Africa marks an important step for the group in building a footprint in Africa, linking the continent to the global Rhenus network,” says Tobias Bartz, a member of the Rhenus board.
“The formation of Rhenus Logistics South Africa is a vital development for our business, opening up new service offerings for clients,” concludes Bartz. “It also provides an excellent mechanism through which we aim to grow our market share over the next years. We are delighted to be ending off 2020 in an even stronger position.”
IBS Software is offering its iCargo customers the opportunity to increase their reach to the market and thereby scale their cargo revenues through a new partnership with CargoAi. By partnering with CargoAi, IBS’ customers can extend their presence in new and existing markets by leveraging on digital sales and distribution services. This is a real ‘helping hand’ both for business and for digitalization within the industry.
IBS Software has been working with CargoAi since July 2020 to build a rich integration between iCargo and CargoAI using a scalable, API based architecture. “Through this partnership, CargoAi and IBS Software have invested in creating platform-level integration to give our customers more choices on channels to digitally connect with their clients, faster time-to-market for such capabilities, and to do so with very little effort,” says Ashok Rajan, SVP & Head of Cargo & Logistics, IBS Software. He adds: “We believe that innovation can be fast-tracked by partnering with companies like CargoAi bringing in new and improved ways of doing business like in sales and distribution, which is still very antiquated and legacy-based in the air cargo industry.”
Keen to offer a ‘digital ecosystem’ to its customers, IBS Software is making its motto of ‘Partnering for Innovation” a reality. With this API based integration between platforms, airlines using only have to turn on the switch for e-bookings from all over the world to reach their system. The process couldn’t be easier for airlines – only a few days of tests are required between the platforms to get on board with CargoAi and no expensive bespoke IT development or complex system integration projects is required to deliver this capability. All the work has been done ahead of time by the two partners.
“The integration currently covers real-time e-booking and e-quoting, flight availability searches and shipment tracking. Lots of other possibilities exist, but this partnership is already showing just how essential synergies are in order to make digitalization accessible to all stakeholders in our industry, a goal that we share with IBS,” says Matthieu Petot, CEO of CargoAi.
Continuing its contributions for the sustainability of the global supply chain by building a global air cargo bridge all across the globe with its cargo flights, Turkish Cargo started to carry COVID-19 vaccines with its strong fleet, wide flight network and special cargo service quality.
Offering service to 127 countries around the world, Turkish Cargo carried the COVID-19 vaccines, manufactured in China, to Brazil which is at a flight distance of approximately 17 thousand kilometers. The COVID-19 vaccines, loaded inside 7 containers equipped with dedicated cooling systems, were transported safely from Beijing to Sao Paulo, the biggest city of South America, with a connection flight at Istanbul.
By carrying pharmaceuticals to the key and certificated destinations such as Mumbai, Brussels, Istanbul, Singapore, Dubai, Basel, London and Amsterdam, Turkish Cargo created a global pharmaceutical corridor between more than 400 destinations and maintains its commitment to transporting the COVID-19 vaccines that are ready or being developed.
Holding the IATA CEIV (Center of Excellence for Independent Validators) pharma certificate, Turkish Cargo, maintains the cold chain at the optimal conditions thanks to the “TK Pharma” product which was has designed for carrying pharmaceuticals at global standards. Transporting pharmaceuticals all across the global in great numbers during the course of the pandemic, the successful brand carried more than 40 thousand tons of pharmaceuticals, medical products and medical equipment between January and September, and reported growth over 50 percent for the pharmaceutical shipments during the same period.
Turkish Cargo provided a capacity increase for the COVID-19 vaccine shipments
In order to satisfy the increased demand for transportation of vaccines, pharmaceuticals and temperature-controlled cargo, Turkish Cargo commissioned the temperature-controlled smart warehouse with an additional area of 1200 square meters. Additionally, having increased its capacity for the cold chain shipments by 30 percent by working with the largest suppliers of active containers in the industry, Turkish Cargo enhanced its cold chain shipment scale to 25 thousand tonnes per month thanks to the capacity to service additional 150 aircraft pallets on instantaneous basis.
Turkish Airlines Chief Cargo Officer, Turhan Özen stated; ‘’We made significant contributions for the sustainability of the supply chain and enlarged our cold chain footprint all around the world thanks to the business processes we have been maintaining uninterruptedly during the course of the pandemic. For the purpose of maintaining the cross-continental cold chain, Turkish Cargo offers industrial solutions such as dedicated temperature-controlled storehouses between the range of -20/25 degrees, pharmaceutical maintenance teams, active containers and thermal carriers. Thanks to our special cargo shipments, for which we hold all global qualifications and certifications, we are ready to transport the vaccines that are ready or being developed to all across the globe.”
SmartIST, the key transit air logistics center between Asia and Europe
Turkish Cargo is getting ready to offer even higher standards for the pharmaceutical shipments with the certificated dedicated operation areas that will be available with SmartIST, its new mega facility located at the Istanbul Airport (IST) that covers an area of 340 thousand square meters.
With an annual handling capacity of more than 4 million tonnes, SmartIST will be equipped with the receival, delivery and operation area dedicated for the special cargo, the temperature-controlled unit devices (ULDs), an operation area of 2100 square meters isolated from the other cargo and a web-based temperature and humidity monitoring systems.
Boasting the world’s widest direct cargo aircraft network, Turkish Cargo reaches over 300 destinations, 95 of which is direct cargo destinations and offers its services 24/7 to its customers over its global network with its fleet of 365 aircraft. Turkish Cargo continues to raise its bar for success every day by combining its wide range of service and operational capabilities with the unique geographical advantage of Turkey and aims to become one of the top 5 air cargo brands in 2023.
Technology has made the world smaller and faster.Real time communication with people from all over the world at different time zones through phones and gadgets
