Asia-Pacific cargo airlines’ revenue slipped nearly 5 percent last year as stiff competition and lackluster demand compressed volume growth, according to figures released recently by the Association of Asia Pacific Airlines (AAPA).
Cargo revenue declined by 4.6 percent in 2013 year-over-year to US$20.2 billion, caused by persistently soft global trading conditions which in turn affected demand for air-freighted goods manufactured in Asia, noted AAPA.
In freight tonne kilometers, international air cargo traffic saw a 1.2 percent decline.
Passenger and cargo airlines in the region recorded $2.5 billion in combined net earnings in 2013, a 55 percent fall compared to the $5.6 billion reported for the year 2012.
Operating revenue for the region’s carriers totaled $171.2 billion, 2.1 percent less than the $174.9 billion achieved in 2012.
“Overall, Asia-Pacific airlines faced challenging conditions in 2013, and registered a net profit margin of just 1.5%, compared with the 3.2% margin achieved in 2012. Intense competition in both the passenger and air cargo business segments led to pressure on fares, and weaker Asian currencies adversely affected costs, even more so for airlines with significant exposure to foreign-denominated debt,” said Andrew Herdman, AAPA director general.
Looking ahead, Herdman said Asian carriers are still expected to face a difficult operating environment marked by continued market competition and volatile currency markets.
“The focus for airlines remains firmly on strict cost controls and further productivity improvements,” he continued. “Overall, however, prospects for a further pick-up in the global economy and expectations of a cyclical upswing in international trade should give some grounds for optimism.”
Meanwhile, Singapore Airlines Cargo (SIA Cargo) pruned its operating loss in the fiscal year 2013-14 to SGD100 million (US$80 million) from the SGD167 million loss the company posted the year before.
SIA Cargo’s load factor of 62.5 percent was 0.9 percentage point lower, as a 5.1 percent reduction in load tonne kilometer outpaced a 3.6 percent cut in cargo capacity.
In its outlook, the group said that cargo yield is “expected to remain weak as the air cargo industry continues to face challenges from overcapacity.”
Photo: Aleksander Markin
