It highlights the war in Ukraine, Covid measures in China, and the high cost of living as contributors to falling demand, exacerbated by staff shortages for airport ground services and manufacturing production.
Load factors have taken a hit, down 9% pts to 62% partly due to capacity increasing 1% and the figure in April 2021 being exceptionally high.
The dynamic load factor in April was about the same level as 2019 but capacity is down 13% compared to before the pandemic.
Despite lower volumes, rates in April 2022 were 145% higher than in 2019 and 26% above last year.
Niall van de Wouw, founder of CLIVE and Chief Airfreight Officer of Xeneta following its takeover says: “The rationale behind lower load factors and higher rates is the bottleneck on the ground – which appears to be being caused now by not only the shortages of people handling cargo at airports around the world and the severe lack of truck drivers to move the goods, but also by a wider shortage of people for lower paid logistics jobs. We are now seeing this larger theme impacting the entire supply chain.”
The shortage of goods, longer lead times, higher shipping costs, flight delays and cancellations are consequences of the market conditions, and higher living costs for consumers is likely to be affecting demand.
From Europe to North America, dynamic load factors averaged 70%, a drop of 12% pts in a month and the first time it fell below 80% as passenger capacity increased, which is expected to relieve pressure on rates.
Van de Wouw says: “During the last week of March, capacity increased by 15% compared to the previous week. This significant increase in space reinforces our previously stated forecast that the North Atlantic market will most likely be the first to return to some kind of normal, because of the high share of belly capacity on this lane.”