China’s air cargo growth to slow

December 17, 2007 by SwizStick  
Filed under Air Cargo, Airlines, China

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So says Julian Keeling of Consolidators International. Via Air Cargo News:

“China’s labour costs; its primary advantage as a manufacturing reservoir are rising inexorably with its once quiescent work force agitating for higher wages with the government ordering pay increases to ensure labour peace as Beijing hosts the Olympic Games next summer. Also, the UK’s economy is slowing, which will generate less demand for Chinese goods.”
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“While cargo growth is expected to slow down because of China’s less than exuberant manufacturing gains; new all-cargo airlines, with exquisite timing, are jumping into the airfreight pool. New carriers like Jade, Great Wall, Cargo B and Alitalia among others, believe there is unlimited growth in the China market. They may be severely disappointed.

“The law of supply and demand still rules our business.”

I think the key phrase to retain from this is that GROWTH is SLOWING, not stopping, nor is the air cargo market in decline. But if the carriers aren’t careful and continue to throw capacity at a market that is slowing down, they could find themselves in a sticky financial situation in the near future.

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