Incheon International Airport execs welcomed a string of new all-cargo entrants last year, from Qantas and Finnair to AirBridgeCargo, while other carriers stepped up frequencies. With throughput surging 16.1 percent to 2.68 million metric tonnes, Incheon ended the year as the world’s fourth-largest air cargo gateway, according to statistics from the Airports Council International.
A year later, the sizzle has dissipated. Although Korean exports were still up in September, the growth momentum had slowed considerably; the vital semiconductor sector actually suffered an export drop of 4.2 percent. The International Monetary Fund shaved half a percentage point in September from its forecast for the nation’s 2011 GDP growth.
In the second quarter, Korea’s economy grew 3.4 percent, the slowest growth in seven quarters, and predictions for the second half of 2011 point to a further decline as a result of anemic demand in the country’s major European and North American markets.
A recent survey of Korean exporters by the nation’s Chamber of Commerce and Industry showed two-thirds of respondents expecting not to meet their targets for this year, owing to weaker demand and high volatility.
For exporters and airlines alike, the great hope is that a pending free-trade agreement with Europe and the recently approved FTA with the U.S. prove to be a huge boost for Korea’s international trade. By some estimates, an FTA deal with the European Union could increase trade by $4.7 billion annually until 2015, with airfreight volumes rising 6.1 percent.
At this point, activity in both the European and North American markets lag behind earlier projections by Korean Air and Asiana, representatives from both carriers have declared.
“This year’s business has decreased because of economic circumstances in the eurozone and North America. Korea’s exports and imports are not as strong as last year because demand in the U.S. and EU has been getting weaker,” noted Kee Chul, vice president of cargo sales at Asiana.
In response to the weaker core markets, Korean carriers are looking at other destinations and routings to improve load factors and yields. Korean Air has added a string of second-tier cargo markets — Qatar, St. Petersburg, Istanbul and Zaragoza — to its freighter network in recent months. At the beginning of September, Asiana extended its freighter reach in the U.S. to Miami and Portland, Ore.
Kee acknowledged that Miami is a move to tap into the flows between Asia and Latin America, which have been strong, thanks to robust demand in Brazil and its neighbors for goods made in Asia. Korean Air already runs six freighters a week to Miami, but it is looking to expand its footprint in Latin America.
Having mounted passenger flights to Sao Paulo earlier this year, the carrier is now mulling over the viability of operating freighters to the Brazilian city, a spokesman for the cargo division said.
Elsewhere in Latin America, Korean Air has been linked to Peru and Ecuador. The Peruvian government boasted in September that the carrier would mount passenger flights to Lima before the end of the year, after a KAL delegation had visited Peru.
Similar claims have emanated from the government of Ecuador after the signing of a new aviation bilateral with Korea, which paved the way for a new route between the two countries.
On its transpacific routes, KAL is looking to expand capacity by replacing some 747-400 freighters with B747-8 cargo aircraft. According to the KAL spokesman, management intends to deploy the new 140-tonne freighter on sectors to Hong Kong, Los Angeles and San Francisco. KAL was due to receive its first 747-8 in October, while the second is scheduled for January.
Asiana wet-leased a 747-400 freighter to replace its own model that crashed in late July en route from Seoul to Shanghai, allegedly because of lithium batteries on board. At the beginning of September, it mounted all-cargo flights from Seoul to San Francisco and Los Angeles.
For the time being, there are no plans to add any more points to the network, Kee declared. Asiana’s next 747-400 freighter is not due before mid-2012, and two more will follow in 2014 and 2016.
Both airlines suffered setbacks in the second quarter from the weaker global economy and higher fuel costs. Korean Air posted a net profit for the period, but had an underlying operating loss of some $19 million, while Asiana saw operating profit plummet more than 64 percent.
Incheon International Airport execs welcomed a string of new all-cargo entrants last year, from Qantas and Finnair to AirBridgeCargo, while other carriers stepped up frequencies. With throughput surging 16.1 percent to 2.68 million metric tonnes, Incheon ended the year as the world’s fourth-largest air cargo gateway, according to statistics from the Airports Council International.
A year later, the sizzle has dissipated. Although Korean exports were still up in September, the growth momentum had slowed considerably; the vital semiconductor sector actually suffered an export drop of 4.2 percent. The International Monetary Fund shaved half a percentage point in September from its forecast for the nation’s 2011 GDP growth.
In the second quarter, Korea’s economy grew 3.4 percent, the slowest growth in seven quarters, and predictions for the second half of 2011 point to a further decline as a result of anemic demand in the country’s major European and North American markets.
A recent survey of Korean exporters by the nation’s Chamber of Commerce and Industry showed two-thirds of respondents expecting not to meet their targets for this year, owing to weaker demand and high volatility.
For exporters and airlines alike, the great hope is that a pending free-trade agreement with Europe and the recently approved FTA with the U.S. prove to be a huge boost for Korea’s international trade. By some estimates, an FTA deal with the European Union could increase trade by $4.7 billion annually until 2015, with airfreight volumes rising 6.1 percent.
At this point, activity in both the European and North American markets lag behind earlier projections by Korean Air and Asiana, representatives from both carriers have declared.
“This year’s business has decreased because of economic circumstances in the eurozone and North America. Korea’s exports and imports are not as strong as last year because demand in the U.S. and EU has been getting weaker,” noted Kee Chul, vice president of cargo sales at Asiana.
In response to the weaker core markets, Korean carriers are looking at other destinations and routings to improve load factors and yields. Korean Air has added a string of second-tier cargo markets — Qatar, St. Petersburg, Istanbul and Zaragoza — to its freighter network in recent months. At the beginning of September, Asiana extended its freighter reach in the U.S. to Miami and Portland, Ore.
Kee acknowledged that Miami is a move to tap into the flows between Asia and Latin America, which have been strong, thanks to robust demand in Brazil and its neighbors for goods made in Asia. Korean Air already runs six freighters a week to Miami, but it is looking to expand its footprint in Latin America.
Having mounted passenger flights to Sao Paulo earlier this year, the carrier is now mulling over the viability of operating freighters to the Brazilian city, a spokesman for the cargo division said.
Elsewhere in Latin America, Korean Air has been linked to Peru and Ecuador. The Peruvian government boasted in September that the carrier would mount passenger flights to Lima before the end of the year, after a KAL delegation had visited Peru.
Similar claims have emanated from the government of Ecuador after the signing of a new aviation bilateral with Korea, which paved the way for a new route between the two countries.
On its transpacific routes, KAL is looking to expand capacity by replacing some 747-400 freighters with B747-8 cargo aircraft. According to the KAL spokesman, management intends to deploy the new 140-tonne freighter on sectors to Hong Kong, Los Angeles and San Francisco. KAL was due to receive its first 747-8 in October, while the second is scheduled for January.
Asiana wet-leased a 747-400 freighter to replace its own model that crashed in late July en route from Seoul to Shanghai, allegedly because of lithium batteries on board. At the beginning of September, it mounted all-cargo flights from Seoul to San Francisco and Los Angeles.
For the time being, there are no plans to add any more points to the network, Kee declared. Asiana’s next 747-400 freighter is not due before mid-2012, and two more will follow in 2014 and 2016.
Both airlines suffered setbacks in the second quarter from the weaker global economy and higher fuel costs. Korean Air posted a net profit for the period, but had an underlying operating loss of some $19 million, while Asiana saw operating profit plummet more than 64 percent.