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   Vol. 13 No. 78  
Thursday September 18, 2014


Asia Pacific Biz Scaling UpAsia Pacirfic Biz Scaling Up

Cathy Roberson
The Asia Pacific and emerging regions including Africa, the Middle East and South America will win a larger slice of an improving global air freight forwarding market in the coming years, claim analysts at Transport Intelligence.

     According to research compiled by the specialist logistics consultancy firm in its new ‘Global Freight Forwarding 2014’ report, the Asia Pacific market commanded a 35.8% share of the global air freight market by region in 2013, ahead of Europe with 26.7% and North America with 26%. However, Cathy Morrow Roberson, the report’s author and Ti’s senior analyst, said North America and Europe would both see their shares fall in the years ahead.
     “It’s a reflection of the changing global economy,” she told Flying Typers. “The Asia Pacific market is the biggest for the overall freight forwarding market, and that is also true for air freight. This will not change through 2017. In fact, the region will increase its share to almost 40% by 2017 as it takes share from Europe and, to a lesser degree, North America.
     “Emerging markets in other regions–Africa, the Middle East and South America will also see some gains in market share by 2017.”
     Shippers continued to limit their use of pure air freight solutions in 2013 to reduce supply chain costs, instead opting for ocean or sea-air and only using air for high-valued and/or temperature sensitive goods such as pharmaceuticals and perishables. But Roberson said the rate of air freight market contraction slowed during 2013 and this would morph into market expansion in the period to 2017.
     “The global air freight forwarding market noted another year of decline in 2013,” she said. “However, the decline was less than that of 2012 at 3.4%, reflecting an improving, albeit struggling, market.
     “Improving signs were noted from the second quarter 2013 led by the Middle East and Europe.
     “For Europe, this was about the same time as economic conditions appeared to improve as well. For the Middle East, carriers based in this region noted increasing freight and as such expanded routes around the world.
     “For the period 2013-2017, airfreight forwarding is expected to improve with anticipated improving economic conditions. We forecast a CAGR of 5.8% for this time period with emerging markets in Africa, Asia Pacific, Middle East and South America accounting for much of this growth.”
John Manners-Bell      Surprisingly, given the consolidation in the sector over the last decade, Ti found that the world leading air freight forwarders lost market share in 2013, compared to 2012. In 2012 the world’s leading forwarders boasted a 44.7% share of the air freight forwarding market but this fell to 42.7% in 2013.
     “The decline is perhaps due to cargo shifts away from cargo air planes to those of passenger airlines,” said John Manners-Bell, (left) CEO of Ti. “Of the individual airfreight forwarders, DHL Global Forwarding has the largest market share with 8.2%. However, this share is down from last year’s estimated 8.8% probably due to the company’s efforts to not to focus on only tonnage gains, but rather profitable tonnage gains.
     “Meanwhile, Kuehne + Nagel increased their share from 7.5% to 7.7% for this year. Likewise, DBSchenker also increased its share from last year.
     “For the remaining top 10 airfreight forwarders, slight increases were noted from 2012.”
     Ti also found that the market became marginally more fragmented during 2013 in terms of tonnage handled. “This could be the result of various factors including the use of niche players that may specialize in a particular industry and/or trade lane as well as the possibility of shippers bringing this in-house to manage as the use of airfreight focuses more towards higher-valued goods,” said Roberson.
SkyKing



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