Bisignani: Fall in air freight demand “shocking”

Bisignani: Fall in air freight demand “shocking”

Bisignani: Fall in air freight demand “shocking”

Bisignani

   The head of the International Air Transport Association said Tuesday that the airline industry will likely lose $2.5 billion in 2009, a year after it lost $5 billion.
   'It looks better but it hides the fact that our industry is getting smaller,' said Giovanni Bisignani, IATA's director general and chief executive officer, in a recorded message to 700 industry attendees of IATA's World Cargo Symposium in Bangkok this week. 'This year global airline revenues will shrink by $35 billion to about $500 billion. Cargo demand will fall by 5 percent and cargo revenues will drop by 9 percent to $54 billion. And that is just the airline story. The pain is spread throughout the cargo supply chain. We are in this crisis together.'
   Bisignani said falling cargo demand is largely to blame for the industry's ordeal.
   'The industry is in crisis and nobody knows that better than our cargo colleagues,' he said. 'Cargo demand has fallen off a cliff. After a shocking 22.6 percent decrease in December it dropped a further 23.2 percent in January.'
   Air cargo represents about 10 percent of industry revenues, he added.
   'The continued decline in cargo markets is a clear sign that we have not yet seen the bottom of this economic crisis,' Bisignani said. 'Unfortunately, the shocking fall in demand is making (IATA's December projections for 2009) look optimistic.'
   He pointed to IATA's initiatives on security, e-freight and its quality assessment program Cargo 2000 as ways airlines can endure the crisis.
   'Customers want a good price and a great product, delivered via the supply chain with speed and reliability,' Bisignani said. 'And in crisis, customers will only get more demanding. To meet their expectations and build a solid future for the industry, change is required. Change is never easy but a crisis is painful. We must use it as an opportunity to drive change that builds a more solid future for this great industry that supports 32 million jobs and $3.5 trillion in economic activity.' ' Eric Johnson