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By Chuck Taylor
Tom Crabtree tracks the air-cargo industry for a living, so he knows well the cyclical nature of the business. He had never seen anything like this:
A record-breaking year in 2007 was followed by a devastating drop in air-cargo traffic in 2008 and into 2009. Average air cargo yield -- the amount airlines earn per unit weight carried -- plunged nearly 25 percent.
"It was the worst freight downturn in the history of jet transportation," Crabtree said.
Now, just as suddenly, air-freight carriers are reporting renewed strength in the market. And if the past is an indication, that bodes well for the world economy.
"Air cargo leads a recovery by three to six months," said Crabtree. "It is itself a leading indicator."
From across the globe, encouraging numbers are rolling in:
"The recovery is broadly based, with strong exports from Asia confirming improving consumer confidence in both the U.S. and Europe," said Andrew Herdman, director general of AAPA. "At the same time, we are seeing strong growth in exports from the U.S. and Europe to Asia."
Shipments of semiconductors -- cell phones, in particular -- are one driver of demand, according to IATA.
"Overall, air freight demand is now back to the levels seen before the recession. Airlines have been reintroducing capacity to meet the growth."
-- Andrew Herdman, Association of Asia Pacific Airlines
"Overall, air freight demand is now back to the levels seen before the recession," said Herdman. "Airlines have been reintroducing capacity to meet the growth."
For Tom Crabtree, who oversees Boeing's cargo-industry forecasting, the sudden rebound in air shipping has been a "whiplash".
Whether the recovery takes hold or gives way to another dip will depend on global economic activity. The thing that differentiates air shipping from ground transportation -- timeliness -- makes air-freight carriers nearly instantly susceptible to economic change, good or bad.
"One of the best proxies for air freight growth right now is industrial production," Crabtree said. "It has rebounded to recapture a good portion of the reduction recorded in 2008 and 2009."
"The outlook for the coming months remains broadly positive, supported by Asia's buoyant economic growth -- although some concerns remain over regional imbalances, as well as oil and currency volatility," said Herdman.
But even a solid recovery will not erase the memories of 2008 and 2009. In fact, the legacy of the great downturn will live for some time.
The recession prompted Crabtree and a team of Boeing analysts to temper the biennial World Air Cargo Forecast. Whereas the last report, issued in late 2008, predicted air-cargo traffic to grow an average of 5.8 percent by 2028, Crabtree and his team acknowledge the downturn by dropping that rate to 5.4 percent in last year’s Current Market Outlook. Boeing will issue a new World Air Cargo Forecast in November.