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Signs of a cooling air freight market after record heat

A return to normal means declining altitude for air cargo.

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Release Date
August 17, 2022
Signs of a cooling air freight market after record heat
The business of aviation exists primarily to connect people across long distances. It is no wonder, then, that the arrival of an affliction made worse by moving people long distances in confined spaces had a material impact on air travel.

At a time when people could no longer travel due to the spread of infection, the silver lining came from the business of moving non-infectious payloads. Since the pandemic’s start, air cargo has been a bright spot for the industry, producing strong yields and higher demand as the world’s attention — and spending — switched dramatically from services to goods.

Related: Amazon is building an empire in the sky, but it’s no FedEx or UPS

Yet, despite the continuing air cargo boom, signs of a slowing freight market are emerging. From normalizing U.S. GDP trends, to resurgent passenger belly capacity on twin-aisle aircraft, to rolling deepwater port gridlock, the air freight industry continues in a pandemic-driven market – the ripples of which are still being felt.

In this TAC Analysis, we dive into the underlying trends driving air cargo demand and how they have continued to change since the onset of COVID-19. As passenger demand continues its slow return to normal, so does demand for air cargo, representing a significant cooling back to the long-term trend.

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