European road feeder services kept busy by the dynamic air cargo market

Demand for European road feeder services (RFS) has been buoyant for the past couple of months and is expected to gain further momentum as the air cargo market enters its traditional peak season, according to a leading player in the sector.

Wallenborn Transports, which runs services to over 120 airports in Europe and has bases in 10 countries with a 900+ strong fleet of trucks, did not experience a summer slowdown this year and its August order numbers were up 9.5% on the same month last year.

“This growth continued through September which will be around 8% higher than in 2019,” the Luxembourg-based company’s commercial director, Jason Breakwell, told Lloyd’s Loading List.

“In the first nine months of the year, our volumes and turnover increased by approximately 6% and 9% respectively.”

Turning to the fourth quarter (Q4), Breakwell expects the market to more than maintain its positive dynamic while continuing to be hindered by capacity issues.

“Most airlines have announced severe cutbacks to their winter pax schedules compared with last year and there will be launches of several premium consumer products in the coming weeks,” Breakwell said. “Demand is high but the crucial difference is the shortage of capacity, not only as a result of the suspension of so many passenger flights but also the recent increase in charter flights from the Asia Pacific (APAC) to North America which has squeezed APAC-Europe capacity.

“As in the previous two quarters, I expect global demand for air cargo in Q4 to be down slightly on last year but supply (capacity) will be much lower.”

Wallenborn had to adapt its pan-European RFS network significantly when airlines made drastic cuts to their passenger services earlier this year in the wake of the pandemic, with the bellyhold cargo capacity the sector relies so heavily on disappearing almost overnight. The norm became a high number of charter flights – flown by both pure freighter and pax to freighter aircraft.

“We’ve experienced waves (of charter flights), for example, those carrying electronics in March and April, followed by masks, then gloves and now electronics and general cargo again – because scheduled capacity is not returning as fast as demand.

“We’ve deployed more (truck) capacity to the airports that have specialized in charter flights, mainly the ‘freighter friendly’ airports. Inevitably, congestion has occurred at some of the busier ones and this has impacted our productivity.”

The capacity situation has improved marginally

While the capacity situation has improved marginally compared to when the lockdowns were in force, with some passenger service schedules returning, Bolloré Logistics’ procurement director for air freight, Claude Picciotto, underlined that the lack of belly cargo capacity is still generating a “huge” shortage in the overall market.

“This is not foreseen to recover before 2022, which will keep creating tensions whenever demand increases. From the beginning of the crisis in February, we started operating charter flights to compensate for the increasing shortage of capacity. 

“We continue to work to add charter capacity from Asia to Europe and the USA and have also established a charter programmed to Africa with two flights a week from Liège to support our customers’ needs,” he explained.

As for the major routes for air freight flows, Picciotti highlighted the Greater China market where the dominant feature between mid-July and early-September had been fluctuating demand “due to an over-commitment of charters by some players, the fall-off of PPE shipments from oversupply and keen competition from the Vietnam market.”

This was accompanied by cooling off in rates in Q3, from the “soaring” levels seen in the first and second quarters of the year when many countries were under lockdown and the capacity squeeze was at its tightest, he noted.

“However, it is highly anticipated that after China’s Golden Week holiday (1-7 October) the market will pick up speed driven by high-tech supplies of 5G, Sony PlayStations, and Apple products as well as a surge in e-commerce business – kicking off the peak period,” Picciotto added.

As for the verticals which have fared best and worst in the corona environment, he said: “Aerospace is undoubtedly the worst hit while the automotive, energy and textile industries have also been impacted due to the sudden fall in consumption. Healthcare, luxury goods, and high-tech products, especially 5G technology-related devices and laptops, have performed consistently and it goes without saying that the PPE vertical has stood out markedly during the pandemic.”


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