Asian airlines face tough start to 2020 with coronavirus

AIRLINES in Asia saw international air cargo demand, as measured in freight tonne kilometres (FTK), drop by 5.1 per cent in 2019, as well as a shaky start to 2020 now that the coronavirus is deterring travellers worldwide.

Figures from the Association of Asia Pacific Airlines (AAPA) show that freight capacity expanded by just 1.3 per cent, resulting in a 3.9 percentage point drop in the average international freight load factor to 59.5 per cent for the year, reported London's Air Cargo News.

AAPA director general Andrew Herdman said: "Air cargo markets experienced a very challenging 2019, with the 5.1 per cent drop in demand marking the steepest fall since the global financial crisis. Declines in new export orders throughout the course of the year led to lower demand for air shipments.

"Overall, in 2019, Asian airlines faced an intensely competitive operating environment, with downward pressure on yields and profitability, only partially alleviated by the 7.2 per cent decline in global jet fuel prices to an average of US$79 per barrel for the year."

Looking ahead, Mr Herdman said: "The general outlook for 2020 was already clouded by uncertainty over prospects for the global economy and still unresolved trade disputes.

"The recent 2019-nCoV coronavirus outbreak has now been categorised by the World Health Organization as a Public Health Emergency of International Concern. The related imposition of travel restrictions and widespread public concern has led to significant falls in demand for air travel on routes to/from and within China, and corresponding adjustments to airline schedules."