By Maria Kalamatas
March 5, 2025 – The Logistic News
Kuehne+Nagel (K+N), one of the world’s leading freight forwarders, has reported a significant rise in air cargo volumes in 2024, reflecting strong demand for global logistics services. However, despite this operational growth, the company faces profitability challenges due to cost pressures, fluctuating freight rates, and evolving market dynamics.
Rising Demand, Declining Margins
K+N’s air freight segment has experienced a substantial uptick in shipment volumes, driven by:
- Increased e-commerce demand, particularly in cross-border trade.
- A rebound in manufacturing exports, fueling higher cargo flows.
- Shifts in supply chain strategies, with businesses diversifying freight options.
A K+N spokesperson told The Logistic News: “While our air cargo division has seen strong volume growth, market conditions remain volatile. Higher operational costs and pricing pressures continue to impact overall profitability.”
The Profitability Dilemma
Despite the positive volume trend, K+N’s earnings have been affected by:
- Rising fuel and handling costs, reducing profit margins.
- Competitive freight pricing, as the market stabilizes post-pandemic.
- Capacity fluctuations, making cost control more complex.
- Geopolitical disruptions, affecting trade routes and logistics costs.
Industry analysts suggest that freight forwarders must adapt to a low-margin environment, prioritizing operational efficiency and value-added services to maintain profitability.
How K+N is Navigating Market Challenges
To counterbalance shrinking margins, Kuehne+Nagel is focusing on:
- Expanding premium logistics solutions, such as time-sensitive and high-value cargo handling.
- Investing in digital freight technology, improving shipment tracking and efficiency.
- Strengthening partnerships with airlines, ensuring capacity stability.
- Exploring sustainability-driven logistics, optimizing fuel efficiency and carbon-neutral shipping options.
A logistics expert commented: “The air freight sector is undergoing rapid transformation. Forwarders like K+N must leverage innovation and strategic agility to stay ahead in an increasingly competitive landscape.”
Future Outlook for K+N and the Air Cargo Market
Looking ahead, K+N is expected to:
- Adjust pricing strategies to navigate market fluctuations.
- Expand into new trade corridors, reducing dependency on volatile regions.
- Enhance supply chain automation, driving cost savings and efficiency.
With the air freight industry at a pivotal moment, Kuehne+Nagel’s ability to adapt to changing economic conditions will define its long-term success.
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