By Eva Richardson | The Logistic News | March 28, 2025
Preliminary air cargo traffic figures released by the Association of Asia Pacific Airlines (AAPA) suggest a shift in momentum, as air cargo demand growth decelerated in February 2025, impacted by subdued export activity during regional holiday periods and emerging economic pressures.
The AAPA reported a 2.8% year-on-year increase in international air cargo demand, measured in freight tonne kilometres (FTK), during the month. While positive, this figure marked a noticeable slowdown from January’s 4.7% growth, largely due to a drop in export activity from major manufacturing hubs like China, where production dipped during Lunar New Year celebrations.
Capacity Grows, But Load Factor Falls
Despite the softer demand, airlines in the region expanded available freight capacity by 6%, leading to a mismatch between supply and demand. This imbalance resulted in a 1.7 percentage point decline in the average international freight load factor, which dropped to 56.5% in February.
According to Subhas Menon, Director General of AAPA, the first two months of 2025 still reflect a positive overall trajectory, with a combined 4% year-on-year increase in cargo demand—driven by robust shipments of consumer and intermediate goods, especially within fast-expanding e-commerce channels.
“International air cargo demand increased by 4% year-on-year, supported by higher demand for consumer and intermediate goods,” said Menon.
Cost Pressures and Trade Protectionism Loom Large
Looking ahead, however, AAPA flagged rising operational costs and growing protectionist policies as significant concerns for Asia-Pacific carriers.
Menon warned that cost pressures—fueled by fleet capacity constraints and inflationary trends—are tightening margins, even as demand remains resilient. The region’s airlines, many of which rely on cross-border trade, are also increasingly exposed to the uncertainty of global trade policies and political shifts.
“The recent rise in protectionist sentiment also presents potential challenges to trade and broader business activity,” Menon noted. “In response, Asian airlines are maintaining a cautious stance, closely monitoring evolving operating conditions while actively exploring opportunities in high-potential growth markets.”
E-Commerce a Bright Spot
Despite the headwinds, e-commerce continues to be a critical driver for regional air cargo volumes. The surge in cross-border online retail, particularly from manufacturing powerhouses like China, South Korea, and Vietnam, is helping to support the base level of airfreight activity and enabling airlines to tap into new revenue streams.
Analysts say that sustained consumer demand and faster shipping expectations will likely cushion air cargo operators in Asia from broader trade volatility in the short term.
Conclusion
While February’s cargo figures show a moderation in growth, Asia-Pacific airlines are navigating the shifting landscape with caution. Rising costs, protectionist trade environments, and holiday disruptions are adding layers of complexity—but with strong fundamentals in e-commerce and regional consumption, the outlook remains cautiously optimistic.
As global trade continues to evolve, all eyes will be on how Asia-Pacific’s carriers adapt their network strategies, capacity planning, and regulatory responses to maintain their competitive edge.
