air cargo

A surge in aircraft deliveries could dent already falling air cargo earnings and push some companies out of business, reports the FT.com.

International Air Transport Association (IATA) figures showed that air freight capacity was 1.8 per cent higher in October than in September 2010, but 4.8 per cent less freight was carried. Such discrepancies tend to reduce what carriers can charge, the FT said.

Air cargo operators are taking delivery of large numbers of aircraft ordered before the 2008 economic crisis, some of which suffered long manufacturing delays, according to the report.

This rise in global air cargo capacity has coincided with weaker demand for airfreight space as the world economy slows down, and exporters choose to move goods more cheaply by sea.

The Netherlands based Ceva Logistics told the FT that it expected the slump in rates, which started to fall a year ago, to last for at least another six months as a result, and force some carriers into insolvency.

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