News #115 - Airlines lower bongdaso con forecast amid escalating trade war

06.06.2025

The International Air Transport Association (IATA) has revised its 2025 forecast for bongdaso con demand and revenue, citing the impact of escalating global tariffs initiated by the U.S. administration. The adjustments reflect a challenging freight market disrupted by protectionist trade measures.

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bongdaso con demand is now projected to grow by only0.7% year-over-year, with airlines expected to transport76 million U.S. tons, down from the earlier forecast of80 million tonspublished in December. This revision comes after an all-time high in 2024 when bongdaso con volumes grew by 12%, according to aggregated industry data. IATA’s previous forecast anticipated a5.8% growth ratefor 2025.


Impact of Policy Changes on Cargo Volumes

The elimination of thede minimis exemptionby the United States for parcels valued below 0 from China and Hong Kong has contributed significantly to declining bongdaso con volumes. This policy change has shifted e-commerce retailers away from direct-to-consumer shipping models toward domestic order fulfillment via ocean freight, which offers lower costs but longer transit times.

IATA estimates a4.7% decline in cargo revenues, amounting to2 billionin 2025, a notable decrease from the7 billionprojected in December. The reduction reflects slower global economic growth influenced by widespread tariffs and other trade restrictions.

The association also predicts a5.2% drop in cargo yields, driven by weaker demand growth and lower oil prices. While higher jet fuel prices typically lead to increased fuel surcharges, which include additional profit margins, the current downward pressure on yields reflects broader market challenges.


Market Dynamics and Challenges

The updated projections suggest the bongdaso con industry may face a significant downturn in the second half of 2025, potentially disrupting the traditional peak season. Despite this, IATA reported strong performance inApril 2025, with cargo demand increasing by5.8% year-over-yearand overall cargo traffic growing2.4%during the first quarter.

Analysts attribute this early-year growth to businesses front-loading orders to mitigate the impact of anticipated tariffs. This trend was observed earlier in 2025, as shippers accelerated imports ahead of sweeping U.S. tariff implementations in April. A subsequent 90-day tariff suspension and reduced tariff rates on Chinese goods to 30% temporarily boosted bongdaso con and ocean freight volumes.

However, the looming threat of renewed tariff increases has prompted many countries to retaliate, further straining the global trade landscape.


Broader Airline Industry Performance

From a holistic perspective, airlines are expected to achieve modest profitability in 2025, withtotal revenues increasing by 1.3%, slightly outpacing the1% rise in total expenses. Passenger demand remains supported by strong employment and easing inflation, although growth rates are lower than previously estimated.

Overall, IATA projectsairline revenueto reach9 billionin 2025, down from the trillionforecast in December. The net profit projection has been adjusted to billion, marginally lower than the earlier estimate of.6 billion, resulting in anet profit margin of 3.7%.

Source: https://www.freightwaves.com/news/airlines-lower-bongdaso con-cargo-forecast-amid-escalating-trade-war

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