March 2020: a few looks behind the month’s final overall results

April 27, 2020

In our trends message of two weeks ago, we provided the preliminary March data. Having meanwhile gone through the final figures, the main conclusions are the same as two weeks ago, albeit with some marginal changes in percentages growth or decline. Thus, year-over-year (YoY) March 2020 showed a 19% drop in cargo carried worldwide, and the sudden capacity shortage in the second half of the month indeed made for sharp price increases.

We have all read the stories with anecdotal ‘evidence’ of humongous price increases. These stories can now be put in proper perspective, having gone through the full worldwide data of over 70 airlines, which provide the following picture:

Of the ten city pairs with the highest price increase (USD) between January and March, six were on the North Atlantic. New York-London topped the list (+104%), while Los Angeles - Amsterdam was nr 10 (+55%).

Of the ten city pairs with the highest price increase (USD) between January and March, four were on the North Atlantic. Frankfurt – Beijing topped the list (+122%), while London -  New York was nr 10 (+75%). For our (public) monthly yield/rate report, click here.

Overall, in Q1 2020 cargo carried was in decline (-9% YoY). The one product category growing was pharmaceuticals (+7%), as the transport by air of fish and seafood was hardest hit (-13%). Belgium was the only one of the Top-50 countries showing growth for each of the three months in Q1, driven by large increases in pharmaceuticals, live animals and dangerous goods.

Back to the month of March 2020: what were the most telling changes influencing the March figures? We looked at two different factors: the changes in use of aircraft types and the shifts in distribution patterns.

Use of aircraft

The old work horse of air cargo, the Jumbo, did it again: the number of flights performed with a 747 freighter in March was 34% higher than in February, as the freight carried on this type increased by 48%. The corresponding figures for two other freighters: for the 777-F we measured a 24% resp. 28% increase, and for the A330-F we recorded 18% growth in flight numbers and 30% in cargo carried.

The passenger aircraft carrying by far the most freight, the Triple-7 lost 21% in freight carried. The A330 passenger aircraft performed 39% less flights and lost 36% in freight carried. Within the month of March, the A330 schedules were most ravaged: only 16% of the flights in the first week survived into the last week…

Distribution Patterns

We analysed the business done by the world’s top-15 forwarders with the 20 top-airlines in the WorldACD-database. Thus, for 300 airline/forwarder combinations we looked at the changes between January/February and March. For each of the 300 combinations, we took as a starting point the business done as a percentage of the airline’s total business.

In 23 of the 300 cases (8%), the share of the forwarder in the airline’s total business changed by more than 50% (in 15 cases upward, and in 8 downward). In almost 1/3 of the cases (94 in total, 52 upward and 42 downward) the change was more than 20%. Of these 94 cases, 28 occurred among the top-10 airlines, whilst – in the same 94 cases - 21 occurred among the top-5 forwarders. In other words, the distribution pattern among top-airlines and top-forwarders changed much less than in the other airline-forwarder combinations.

We will inform you in two weeks’ time about the market developments in April.