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EXTRANS GLOBAL - Air Freight News - Week 52


  1. Demand for Sea&Air Services Amid the Honghai Incident? Attention to Additional Effects on the Air Cargo Market!

  • As vessels seek alternative routes due to the congestion caused by the Honghai incident in the Suez Canal, there is a situation of preparing for modal shift in response to shippers' concerns about potential delays in sea transportation.
  • Typically, a modal shift to the air cargo market is expected when congestion in the maritime supply chain persists for a considerable period (at least 1 to 3 months). However, with the prolonged outlook for this incident, it is anticipated that fashion brand shippers, as a primary measure, will likely demand shipment orders through Sea&Air services.
  • Particularly, container vessels departing from Asia to Dubai port are tightly operated, making SEA & AIR potentially the only viable option, especially until the Chinese New Year.
  • In the air cargo market, there is currently no apparent impact of the Honghai incident on air freight rates.
  • This week, air cargo rates departing from Asia are showing a downward trend, while rates to Europe and North America are decreasing after reaching a peak.
  • Some air cargo market experts speculate that if the Honghai incident continues, demand may initially shift to SEA & AIR, and there could be a surge in demand for rail services to Europe. However, in the end, the likelihood of the demand flowing back into air cargo remains high.

  1. Aviation Industry M&A Wave in 20 Years... Concerns about Korean Air Falling Behind the Trend

  • In the midst of a global aviation industry 'consolidation' through mergers and acquisitions (M&A), the merger of Korean Air and Asiana Airlines, which is 20 years in the making, is being delayed to next year, raising concerns about falling behind industry trends.
  • Korean Air has temporarily halted the overall procedural work for the acquisition of Asiana Airlines. The European Union (EU), holding the key to the merger, announced on the 6th that it would temporarily conclude the review of the corporate combination of Korean Air and Asiana Airlines by February 14, 2024.
  • Korean Air is quietly awaiting the outcome as it has submitted all the requested documents by the EU. The focus is on finalizing next year's business strategy and executive appointments within the Hanjin Group schedule.
  • Korean Air submitted corrective measures, including the separation and sale of Asiana Airlines' cargo business, to the EU on December 3. The company stated that it would strive to obtain approval as soon as possible following the release of the suspension of the EU's review.

  1. KTNET: Opening of Automated Processing System for Air Cargo Reservation Settlement Targeting GSAs

  • KTNET has recently built the Air e-CBA (Cargo Boarding Advisory) system targeting air cargo general sales agents (GSAs) and entered full-service operation.
  • Air GSA companies can now electronically process cargo reservation and settlement-related tasks, which were previously handled manually, through KTNET's digital logistics platform, uLogisHub. GSAs can integrate and process diverse CBA formats for each airline.
  • Through KTNET's e-CBA service, GSAs can handle commercial invoice issuance to agencies after cargo reservation, electronic tax invoice issuance, and other settlement tasks in an integrated manner. The system also provides performance management features, displaying weekly, monthly, and quarterly performance.
  • The e-CBA service, developed by actively incorporating the opinions of field practitioners, is available for use with only KTNET's uLogisHub membership without the need for separate program development or system installation. KTNET plans to continue discovering various services that contribute to the digital transformation (DX) and operational efficiency improvement of trade and logistics companies.

  1. Expansion Plans of Airlines/LCCs in the Aviation Industry

  • This year witnessed a explosive increase in aviation demand that had been stagnant due to the COVID-19 reopening. The domestic aviation industry, in response to international travel demand, is actively expanding in various aspects, including aircraft introduction, new employee recruitment, and route expansion.
  • Korean Air recently signed an order for 20 Airbus A321neo aircraft, increasing its A321neo fleet to 50. Before the order, Korean Air had plans to introduce a total of 110 new aircraft, including 10 Boeing B787-9, 20 B787-10, and 30 B737-8.
  • Low-cost carriers (LCCs) are also introducing new aircraft. Jeju Air plans to add two more B737-8 next-generation aircraft, T'way Air will introduce three A330-300s this year and an additional seven aircraft, including two A330-300s, next year. Eastar Jet plans to introduce four aircraft, and Air Premia plans to introduce two.
  • Airlines like Jeju Air and T'way Air are expanding short and medium-haul routes to cater to the current trend of frequent short-distance travel. Jin Air is expanding international routes, with new flights scheduled from Incheon to Nagoya in September, Busan to Tokyo (Narita) in October, and Busan to Taipei and Incheon to Phuket in December.
  • Air Premia plans to operate irregular flights on the Incheon-Honolulu route from December 31 to March 4 and aims to operate daily flights on the LA route from May next year.

  1. Airline/GSA Event Update

(1) VietJet (VJ) announces new Hanoi-Hong Kong route and introduction of A321neo ACF.

(2) Air China (CA) increases daily frequency on Shanghai-Bangkok route from December 20.

(3) Japan-based Zipair Tokyo (ZG) introduces new Tokyo-Vancouver route from March 13, 2024.

(4) China Southern Airlines (CZ) to operate Luxembourg route from late March 2024.

(5) Singapore Airlines (SQ) plans to open London Gatwick route in June 2024, operating A350-900 aircraft.


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