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January 2012 - Issue 69    

 

AIT introduces retail logistics division

AIT Worldwide Logistics is proud to announce the launch of its retail logistics division. 

Building on the industry-leading full service solutions and resources of AIT’s extensive global network, the team of 7 highly experienced employees is focused on leveraging and attracting significant customer growth for the company’s newest vertical market entity. 

Click here to read the full article
  

AIT employees brighten holidays for SOS Children’s Villages

For the fourth consecutive year, AIT helped make the holidays a little brighter for children living in foster care. 

On Monday, November 21, employees were invited to visit the holiday tree in the reception area of AIT’s corporate headquarters location. In addition to traditional trimmings, more than 125 wish tags adorned the tree. Each tag listed a gift request from a child in the care of an SOS Children’s Village. 

Click here to read the full story.
   

AIT announces LTL service enhancements

AIT is proud to announce several significant advancements to its LTL program, which was introduced in last month’s edition of the AIT eNewsletter:

  • Cross-border Canadian pricing - We now offer very competitive pricing to and from Canada and the contiguous 48 states with TST Overland Express and FedEx Freight (with Quick Quote ability in MyLTL).
  • Freight Class Calculator - Some users have had difficulty identifying freight class (a requirement of LTL). This new tool, located on the shipment information screen of MyLTL, calculates the density and corresponding freight class by simply entering the pallet dimensions.
  • FedEx Freight - US domestic rates have also been re-negotiated and are now a very competitive national LTL option.

Review our LTL product flyer and MyLTL product demo for more information.   
   

Air Transport Markets Weaken in November

The International Air Transport Association (IATA) announced global traffic results for November 2011 showing a softening in passenger markets while air cargo markets remained weak compared to levels attained earlier in the year. 

Passenger traffic was 4.3% above November 2010 levels but this is skewed as November 2010 was a particularly weak month. The softening in passenger markets becomes apparent when comparing to the previous month (October 2011). This shows a 0.5% decline on a seasonally-adjusted basis. 

Freight markets were 3.1% below November 2010 levels despite a 1.1% increase on October 2011 performance. 

“Weak global economic performance is being reflected in air transport markets. Freight markets have contracted some 4% compared to January. Although passenger markets have had some growth relative to the beginning of the year – about 2% – the trend has been both soft and volatile. Continuing economic uncertainty will likely mean market shortcomings deepening as we enter 2012,” said Tony Tyler, IATA’s Director General and CEO. 

Globally, passenger load factors have fallen sharply to 76.3% from 78.5% in October. This shows that the weakness in passenger demand is outpacing airlines’ ability to adjust capacity accordingly. Regional differences are sharp. While North American carriers saw a 0.8% decline in travel, carriers in the Middle East experienced a 10.1% increase, followed by 9.0% for Latin American airlines. 

Air Freight (Domestic and International) 

Air freight markets continued their decline in line with weak economic performance and falling business confidence. International markets declined by 3.8%. This was offset by 2.0% growth in domestic markets. Nonetheless, system wide demand shrank by 3.1% in comparison with November 2010. 

  • International freight load factors have declined 6 percentage points from their peak in mid-2010. While freighter capacity has been adjusted to meet demand, belly cargo capacity follows the trend in passenger demand.
  • Asia-Pacific carriers have seen the weakest demand performance driven by falling demand for Asian manufactured goods from US and European consumers. The region’s carriers saw the market decline by 6.4%. European carriers reported a 4.6% fall in demand reflecting continued uncertainty associated with the Euro-zone crisis. North American carriers’ operations were largely unchanged from the previous year with only 0.2% growth. 
  • The Middle East and Latin American carriers delivered the strongest cargo performance with 4.6% and 4.0% growth respectively. 
  • African carriers reported a 1.7% year-on-year decline.

Source: International Air Transport Association, December 30, 2011
   

JOC Economist Lowers 2012 Import Forecast

Sluggish U.S. economy to keep inbound freight growth to 2.8 percent, economist says 

Expectations of a sluggish U.S. economy led Journal of Commerce Economist Mario O. Moreno to lower his forecast for growth in U.S. containerized imports next year to 2.8 percent from his previous prediction of 4.7 percent. 

Next year’s import volume is expected to total 17.4 million 20-foot equivalent units, well above 2009's 14.5 million TEUs but short of the 18.6 million TEUs recorded in the pre-recession peak years of 2006 and 2007. 

Trans-Pacific imports, which account for some three-fourths of the total, are expected to rise 2.7 percent next year. Moreno’s previous forecast in at the end of the third quarter called for a 5.9 percent increase. 

The downward revisions reflect expectations of slow economic recovery and an increase in real GDP next year of only 1.3 percent. 

Containerized imports are expected to be flat in the current quarter and rise year-over-year by just 1.3 percent in the first quarter of 2012, Moreno said. 

The spike in retail sales at the start of the current holiday season is likely to fade amid continued weakness in jobs and housing markets and a “high probability” that the current payroll tax cuts won’t be renewed in 2012, Moreno said. 

A fragile housing market will continue to slow imports of furniture and home goods whose sales often accompany housing sales, he said. Backlogs of foreclosures, tight credit standards and high unemployment continue to depress housing prices and sales. 

On the plus side, Moreno said he expects auto parts imports to rise in 2012 after robust gains this year. But he said the revival in domestic and export demand for U.S. vehicles could be undercut by rising fuel prices. Other wildcards include Europe’s sovereign debt crisis and the threat of a default that could discourage global lending. 

“As post-recession U.S. growth continues to be anemic in 2012, any shock or combination of shocks could potentially bring the U.S. economy to or close to recession,” Moreno said. 

Source: Journal of Commerce
   

Air Freight Price Index Jumps 14.7 Percent

Drewry rate index reaches 12-month high with first substantial gain since April 

The Drewry Air Freight Price Index took a sharp turn upward in October, increasing 14.7 percent from the previous month to its highest level in a year. 

The increase to 114 still left the Drewry measure of air freight rates from Shanghai to the rest of the world down 4.3 percent from the same month a year ago, the 12th straight year-of-year decline. 

But the improvement from September marked the first significant gain from month to month since April, and the reading was at its highest point since November 2010. 

The improvement comes as airlines have pulled air freight capacity from networks amid a tepid expedited shipping season. The Association of Asia Pacific Airlines said capacity for its member airlines was down 2.4 percent in October compared to the previous year. 

Airlines increased their capacity slightly from September to October, typically the strongest month of the year for international air freight, while increasing traffic 7.1 percent sequentially. 

Source: Journal of Commerce
   

 © 2012 AIT Worldwide Logistics, Inc.

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