Air cargo climbs 21% in 2010

Air cargo climbs 21% in 2010    Freight volumes improved 20.6 percent for airlines in 2010, outstripping the 8.9 percent increase in cargo capacity, the International Air Transport Association reported last week.
   The freight load factor increased 5.2 percent to 53.8 percent.
   Passenger traffic rebounded 8.2 percent.
   It was a good year compared to the multibillion-dollar losses of 2008 and 2009, but airline profit margins were only 2.7 percent. And air freight sagged in the second half of 2010.
      Air freight volume was 1 percent higher than the pre-recession levels of early 2008, but volumes fell 5 percent since the peak air shipping time when companies were actively engaged in restocking inventories.
   Freight demand varied wildly from 35.2 percent in May to a low of 5.8 percent in November. Overall the industry is trending towards a normal growth pattern in line with the historical growth rate of 5 percent to 6 percent, IATA said.
   Latin American carriers performed the best in terms of volume growth (29 percent), with the European region being the weakest at 10.8 percent growth.
   Severe weather in Europe and North America in December, not to mention the volcanic eruption that disrupted traffic in Europe last spring, hurt the financial recovery of airlines.
   IATA estimated the bad weather alone reduced traffic demand for the month by 1 percent. As a result passenger demand dipped to 4.9 percent growth from December 2009 levels, significantly lower than the 8.2 percent growth recorded in November. Europe was hardest hit, with growth slowing to 3.3 percent.
   IATA predicted the airline industry would likely enjoy a second straight year of profits, but those gains could be sliced by 40 percent to $9.1 billion due to the sharp rise in jet fuel prices.
   Fuel comprises more than a quarter of airline operating costs.