A recent headline in the
Journal of Commerce said
"Shippers Face Steep Air
Cargo Rate Hikes." As the
article goes on to say, when
European airspace re-opens,
capacity will be scarce,
expensive and there will be
steep hikes in air cargo
freight rates. Many of the
airlines have already
notified us that they are
going to charge premium
rates for all new
shipments-as much as three
times the standard rate.
We had already seen higher
rates prior to the volcanic
eruption in Iceland but this
increase was centered more
on exports shipments out of
Asia because of the short
supply of air and ocean
capacity. To cope with the
recession, airlines and
ocean lines reduced capacity
to cut costs. As freight
volumes have increased the
shortage of ocean capacity
has driven many shippers to
transport their goods via
air, further stressing air
cargo capacity. In Europe,
even before this current
volcanic event, again
capacity was reduced as
airlines reduced flights to
save costs. We expect
capacity to remain in short
supply even after airspace
is re-opened due to the huge
backlog of freight and
passenger priority on
passenger flights.
Despite our top tier
relationship with our
airlines suppliers, many
airlines have suspended all
existing allocations and are
requiring priority rates be
applied to acquire space.
Therefore, until airfreight
gets back to "normal," your
rates will reflect the new
premium rates that the
airlines are now charging DB
Schenker.
On the positive side, DB
Schenker has arranged for
additional warehouse space
throughout Europe to
accommodate as much client
volume as possible. We have
also been able to arrange
several flights from Asia to
Southern Europe to clear
some of that congestion. DB
Schenker is working towards
alternate transport
solutions within Europe. We
have the largest rail and
truck networks in Europe so
we are exploring moving
freight to alternate transit
points to get our customers
freight to its destination
more quickly.
Our teams around the world
are working non-stop to help
get your freight to your
customer as quickly as
possible. This is an
extraordinary event and we
ask your patience as we
navigate this difficult time
together.
We encourage you to talk
with your account executive
as soon as possible to
determine how best to handle
your urgent international
shipments.