China’s future Air Cargo Growth : Intra-China?
China is, and will continue to remain, an important air freight market for European and American importers. However, while it used to almost be a case of “if you build it, they will come” when it came to adding capacity to the China-U.S. / China-Europe trade lanes, it appears capacity is finally starting to outstrip demand. Via this month’s issue of Air Cargo World:
The dragon hasn’t been soaring quite as high over the past 18 months. China’s seemingly insatiable appetite for air freight capacity to North America and Europe is no longer guaranteeing stellar yields for airlines, as capacity out of the major gateways has grown faster than demand. Several carriers, including notables such as Air Canada or Northwest Airlines, have even pulled capacity out of the market.
That being said, as the article points out, demand for Intra-China capacity is booming:
Jingli Zhang, head of Beijing-based express provider BPS Global said that China’s express business grew well in excess of 10 percent last year, “probably close to 20 percent.”
By Boeing’s measure, China’s domestic air freight market has grown 20 percent a year since 1990 and should reach $3.35 billion in 2010. The Civil Aviation Administration of China projects the country’s airports will process 11.8 million metric tons in 2010, with an average annual growth rate slightly south of 14 percent.
According to Airbus, China will need some 130 new freighters over the next two decades to cope with the increase in traffic during that period. The plane maker’s analysts forecast China’s international market to grow 8.5 percent a year on average, while the domestic sector should show annual average growth of 10.5 percent. Boeing predicts 10.8 percent annual growth for China’s domestic air cargo market over the next 20 years.
Over the next decade some 48 new major airports are expected to become operational, adding to the existing 130 around China today. The government has ambitious plans to maintain that momentum beyond 2018.
Read the whole thing.
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