SIA Cargo slashes capacity

Singapore Airlines Cargo has slashed capacity by 20% as it cuts frequencies to Europe and North America. The move is the latest sign that Asia's air cargo sector is struggling in the face of weak demand and over capacity

23rd Feb 2012

Singapore Airlines Cargo has reduced its freighter capacity by 20%, cutting long-haul frequencies to Europe and North America.

SIA Cargo, which operates a fleet of 13 747-400 freighters, says the reductions in utilisation have been in place for a couple of weeks, and will continue for the northern summer season. No routes are being cut, with the capacity reduction coming about through reduced frequencies.

“The air cargo market has shown weakness for the past nine months, and the depressed demand that we are seeing across all markets gives us little reason to be optimistic about the near-term outlook,” said SIA Cargo president, Tan Kai Ping.

“With no improvement expected in the first half of this calendar year, and with stubbornly high fuel prices pushing up costs, we have taken appropriate action to reduce our freighter operations to better match capacity to demand.”

January figures from the Association of Asia-Pacific Airlines show that international cargo demand declined year-on-year by 13.7% in terms of tonne kilometres (FTK), although this in part reflected the early Chinese New Year.

The AAPA says the decline stems from "the persistently weak trading environment and the closure of manufacturing plants due to the holidays. Even with a 5.3% reduction in offered freight capacity, the average international cargo load factor fell by 5.7 percentage points, to 59.6%."

Asian Aviation at a glance