EXTRANS GLOBAL - Air Freight News - Week 04 2025

Air Cargo General

1) Lufthansa Group Completes Acquisition of ITA Airways – Five European Airlines Under One Roof

The Lufthansa Group has officially completed the acquisition of a 41% stake in ITA Airways, Italy's national airline. This transaction follows an agreement made in May 2023 between Deutsche Lufthansa AG and Italy’s Ministry of Economy and Finance (MEF), finalized after approval from the EU Competition Authority on November 29, 2024. The remaining 59% of shares will temporarily remain with MEF.

To facilitate the acquisition, Lufthansa Group raised €325 million through a capital increase. Additionally, Lufthansa retains an option to acquire the remaining shares under the agreement with MEF.

With this acquisition, ITA Airways becomes the fifth network carrier within the Lufthansa Group, establishing Italy as its newest "home market" alongside Germany, Austria, Switzerland, and Belgium. Rome Fiumicino Airport is now the group’s sixth hub, with Milan Linate Airport playing a critical role in the economically significant northern Italian market.

Since its launch in 2021, ITA Airways has experienced rapid growth, operating 99 Airbus aircraft and serving over 70

global routes.

2) Asia-Europe Air Cargo Market: Growth Amid Challenges

The Asia-Europe air cargo market demonstrated significant growth in 2024 but continues to face numerous challenges. Despite Europe's economic downturn, Asia-origin cargo outperformed expectations, with demand on the Asia-Europe route increasing by over 20% year-on-year. Demand for Europe-to-Asia cargo also rose by 7%.

The surge in demand was largely driven by the e-commerce boom, with Cathay Pacific reporting increased volumes of e-commerce goods, consumer products, pharmaceuticals, and luxury items. European airlines also noted stable demand, with heightened cargo movement in France and the Netherlands due to e-commerce and geopolitical factors.

The Middle East conflict has increased lead times for sea freight, further boosting air cargo demand. However, challenges persist, including longer flight times and reduced profitability due to the Russia-Ukraine war and restricted Russian airspace. While Chinese carriers benefit from continued access to Russian airspace, this creates competitive imbalances.

Despite uncertainties, stable demand for EV components, semiconductors, pharmaceuticals, machinery, and auto parts provides a positive outlook. Additionally, sustained growth in e-commerce is expected to support the market in 2025.

3) Air Cargo Market Remains Resilient Amid Capacity Constraints and Rate Declines

Confidence in the air cargo sector remains high despite ongoing capacity constraints. Transport capacity in January 2025 exceeded 2024 levels, with a 5% year-on-year increase. Capacity from Asia-Pacific to Europe grew by 14%, and the reverse direction by 19%. Similarly, capacity between Asia and North America rose by 11% westbound and 8% eastbound. However, transatlantic and North American domestic routes saw declines of 3-7%.

Passenger belly cargo capacity has returned to pre-pandemic levels, with Air China, China Eastern, and China Southern Airlines among the top 10 carriers expanding capacity. Qatar Airways, Cathay Pacific, and Turkish Airlines also showed strong growth.

While spot rates remain 22% higher than the previous year, they fell by 3% week-on-week. Vietnam has emerged as a focal point, with air cargo demand outpacing passenger demand due to diversified supply chains. Despite these dynamics, capacity shortages persist, particularly for Vietnam-origin cargo.

4) Brussels Airport Cargo Volume Grows by 5% in 2024

Brussels Airport, a key European cargo hub, handled 732,797 tons of cargo in 2024, marking a 5% year-on-year increase. Growth was driven by the addition of LATAM Cargo, Lufthansa Cargo, Farcargo, and Virgin Atlantic, which began cargo operations during the year.

Dedicated freighter volumes remained stable with a 0.1% increase, while belly cargo surged by 23% due to new intercontinental routes and passenger flight recovery. The integrator segment saw a slight decline of 0.2%.

Asia, Africa, and North America were the main import regions, while Asia led exports, followed by North America and Africa. December 2024 saw a notable 38% year-on-year increase in total cargo volumes, with all segments contributing to growth, including freighters (57%), express (28%), belly cargo (49%), and trucked cargo (14%).

5) GSA and Airline Updates

Cargo flights canceled until February 6:
- Cargolux (CV): January 30, February 2
- CargoItalia (C8): February 2, 3, 5, 6
Turkish Airlines (TK): January 31 ICN-IST cargo flight canceled.

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