Rip-off or not

THE volcanic ash cloud that heavily disrupted air services in Western Europe for six days in mid-April was originally seen as another devastating blow to an air cargo industry that was just recovering from the lows of 2009.

However, as the cloud drifted away and airspace reopened, airlines found themselves able to command unprecedented rates for new bookings and charters as they attempt to recover lost revenue.

This pricing policy has incensed many shippers and some forwarders that have readily cried “rip-off”.

The European Shipper’s Council said that “airlines and forwarders are saying how much they have suffered, but the real victims are likely to be the shippers”. The Council also alleges that capacity was being allocated to the highest bidder – without consideration of agreed rates in contracts.

Ad-hoc prices from Asia-Europe have been particularly hard hit with rates often four or five times higher than the March average. Backlogs in major hubs, such as Kuala Lumpur, Shanghai and Hong Kong, could take another two weeks to clear and prices are likely to remain high in the short-term.

For the full story read the free latest digital edition of Air Cargo News, dated 3 May, here

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