LATAM Airlines Cargo still can’t seem to catch a break, even when the news is good. Cargo volumes at the Chilean carrier moved up in the month of June, registering a 2.7 percent year-over-year increase after years of mostly poor results. But last month’s showing wasn’t enough to offset year-to-date declines in volumes of 3.7 percent, despite rising regional volumes at a word salad of aviation organizations including IATA, WorldACD, Drewry and Airports Council International (ACI).
The beleaguered airline has made steps to offset declining volumes from regional markets that, up until recently, suffered from a regional economic downturn. For instance, traffic might be down, but available tonne kilometers (ATKs) also fell by 8.4 percent in June, and 9.7 percent, year-to-date. These reduced ATKs are translating into higher cargo load factors, which rose 5.9 percentage points, y-o-y, to 53.9 percent in June, and are up 3.3 percentage points for the first half of this year.
LATAM Cargo first started showing signs of a turnaround in May, when cargo traffic increased by 1.3 percent to reach 271 million freight tonne kilometers (FTKs), its first y-o-y improvement since October 2014.
While the last two months have been encouraging, they need to be considered within the context of a long decline, and the carrier now faces an uphill battle to regain its previous standing.
With regional economyies starting to recover, and a generally strong global market, Latin America is one of the last airfreight markets to cash in on strong volumes that have exceeded the expectations of most market experts. WorldACD noted earlier this year that, “the size of the March-April drop in 2017 may act as a caveat against the view that good times are here to stay,” and amended that assessment in July, describing the current market as a “fairytale.”