Air cargo capacity to grow strongly in 2024

Air cargo capacity grew by double-digit percentages last year, driven by a recovery in bellyhold capacity and the retention of dedicated aircraft space beyond pre-Covid-19 levels.

Total air cargo capacity (measured in cargo tonne-kilometers, or ATKs) in 2024 increased by 10% year-on-year to 442 billion ATKs, according to data and consultancy provider Rotate.

This growth was driven by the return of passenger flights, with belly capacity up 13% year-on-year and just 1% below pre-Covid-19 levels in 2019.

Meanwhile, dedicated aircraft capacity also increased 8% year-on-year, indicating that the industry continues to rely more heavily on freighters than it did pre-pandemic. This was up 43% year-on-year compared to 2019.

Rotate points out that while ATK capacity increased 10% year-on-year, tonnage terms capacity only increased 8%. This suggests that part of the reason for the larger increase in ATK is due to aircraft both carrying more cargo and taking longer routes.

The biggest growth is concentrated on the East-West trade lanes

Trade lanes mainly from Asia lead the growth, driven by a strong increase in e-commerce demand in 2024.

According to Rotate data:

• ATK capacity from Asia-Pacific to North America increased by 15% year-on-year.
• From Asia to Europe, the increase was 16%.
• From Asia to the Middle East, capacity increased by 17%.
• From the Middle East to Europe, capacity increased by 15%, reflecting the shift from sea to air transport due to the Red Sea missile crisis, as well as the strong growth of the e-commerce market.

Challenges ahead

Going forward, the ability of the air cargo market to continue to grow at its current pace may be difficult.

Speaking at the Tiaca Air Cargo Forum last year, Rotate chief executive Ryan Keyrouse outlined some of the challenges the industry could face on the supply side.

He said that capacity growth was slowing, new aircraft production was being delayed and high passenger demand was affecting the availability of aircraft for conversion to freighter service.

Keyrouse also noted that aircraft occupancy rates had reached a five-year high, making it difficult to add capacity from the existing fleet.

“We are almost at maximum utilisation so the aircraft can’t fly more and [in 2025] we see a maximum of 4.4% capacity growth, if you look at deliveries and conversions,” Keyrouse said.

“If you have a 4.4% capacity growth and a 20% demand growth [from China], it can only come from one place - moving capacity from Africa and Latin America into these markets.”

“You have to wonder how far can that go, but that is really only the lever that you have for increasing capacity for this demand,” he added.
 

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Source: Phaata.com (via AirCargoNews)

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