Auto industry accelerates airfreight industry’s crash landing

The quiet boom in SA airfreight in the past couple of years has died down with a whimper following the worldwide financial train smash – and domestic and international air carriers are pruning or otherwise adjusting their service offerings to cope with the downturn. According to SA cargo manager John Clark of Lufthansa Cargo, a major international freight carrier to SA, there are lots of indications of just how much of a downward drop airfreight on the Europe-SA airway has taken in recent months since the start of the global economic crisis. Most airlines on the Europe-SA route had inbound cargo capacity available in December – “an unusual occurrence”, he told FTW – and Lufthansa Cargo has reduced its freighter services from a 7/7 to a 5/7 frequency. “I think it’s got to the stage where shippers are adjusting their capacities and scheduling,” Clark added. There has been a drop of 13.5% in international cargo over the past three to four months, but he felt this had accelerated to as much as 35% towards the yearend and into January. A main driving force behind the drop is that there has been a serious international crisis in the auto-industry, and, Clark said, this is an industry sector which is a large player in airfreight. The domestic major airfreight carrier, SAA Cargo (SAAC), professed to less pain from the global downturn, although spokeswoman Thola Nzuza admitted that “it had resulted in huge drops in volumes as per International Air Transport Association (Iata) results.” These figures showed an international drop of -13.5% in November (the latest available) and an actual 2.2% growth for African traffic. On a year-to-date basis, the international market declined by -2.2% for the first 11 months of the year, and African traffic decreased by 1.5% – although the accelerated drop towards year-end is not yet evident. “The markets that we serve inbound and outbound are fairly balanced,” said Nzuza, “in spite of the recent global downturn. “These are difficult times and SAAC – being part of the global airfreight industry – has also experienced a slight drop in volumes, but ours is not as bad. “Our reduced growth target is therefore 2.8% for the year ending March.” But SAAC’s major focus at the moment is on the domestic and central and west African air cargo markets. Said Nzuza: “We have seen successes on domestic routes – like Johannesburg-Cape Town- Johannesburg. Regionally we have also seen steady growth in markets such as Maputo, Mozambique; Lagos, Nigeria; Lusaka, Zambia; Accra, Ghana; and Kinshasa, DRC due to demand for consignments such as automotives, perishables, telecommunications, information technology (IT) and the like.” SAAC is also currently busy reviewing its network in order to tap into sectors that are new or were under-serviced previously. “This will include, for example, Luanda in Angola and Lubumbashi in the DRC,” Nzuza told FTW. “We will also increase frequencies to Lagos, Accra and Kinshasa.” New ones to be introduced are Buenos Aires, Argentina in April and Douala, Cameroon around the third quarter of the year.