Global Air Freight Australia Market Intelligence

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Are you looking for answers on Global Air Freight Australia?

  • What are the key trends in Global Air Freight Australia?
  • Am I paying the right price?
  • Am I working with the right supplier?
  • What are the major challenges and risks in Global Air Freight Australia?
  • How is Global Air Freight Australia industry performing?

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Report Coverage

  • Market Overview – Analysis of Airport Terminals
  • Air Freight Service Providers – Australia
  • Australia Freight Traffic-June 2019

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Regional Market Overview on Global Air Freight 

  • Buyers are leveraging on lower utilization rate of freighter fleet segment resulting in marginal rise in utilization rates, however only deferred shipments can be consolidated in freighter fleet segment
  • It is observed that the share of inbound and outbound volumes have changed over the years due to geographical presence of the country and it also clearly defines its dependence on air freight
  • Despite strong growth in e-commerce and courier market across Australia, Sydney, Melbourne, Brisbane and Perth have been the major airports contributing to Freight movements
  • Australia relies more of Asian counties such as Singapore, China, Japan and Singapore for movement of freight. Sydney and Melbourne are two major airports who connect to international hubs

Market Overview – Challenges  

Reduced Passenger Fleet Capacity

  • Buyers of belly-hold capacity like DHL, TNT and Toll Aviation would  have high challenge in terms of capacity constraints as major airlines are expected to reduce passenger fleet capacity
  • Airlines  are planning to improve profitability with increase utilization rate

Static Freighter Fleet Capacity

  • Major airlines such as Qantas and Virgin has remained static in terms of expanding capacity in freighter fleet segment for domestic market
  • With minimum scope of freighter fleet expansion, buyers would be challenged with available belly-hold space in the air freight market

Growing Demand of E-Commerce:

  • Buyers of freighter and belly hold capacity would be challenged by increasing volume of e-commerce shipment
  • With growing volume Australia post and Australian air express accommodate more than 80 percent freight volume which is more likely to create challenge for other buyers in the market

Drop in Passenger Fleets Trips

  • With major airlines cancelling the trips of passenger fleets connecting top airports would create capacity crunch for belly-hold buyers in Australian domestic freight market
  • Last minute cancellation history would result in drop in reliability factor for airlines and delay in shipments delivery in courier and parcel market.

Porter's Analysis – Australia Domestic Freight Market 

Supplier Power

  • In the supply side of domestic freight market, Qantas, Jet, Virgin and Tiger Australia airlines have strong bargaining power
  • More than 70 percent of domestic freight capacity is dominated by Qantas Airline group which has stronger hand on buyers of the market
  • Suppliers tend to alter capacity in the market to alter profitability of the market

Barriers to New Entrants

  • Barriers for new entrant is high due to highly competitive nature of the market and large capital investment required to sustain competition from Qantas and Virgin Airlines group
  • New entrant will be challenged with high complex and high cost operating environment in Australian aviation market

Intensity of Rivalry

  • Despite consolidated nature of the market, domestic air freight market has remained highly competitive in Australia
  • Qantas domestic airline is slowly starting to lose volume to Virgin Domestic airline in terms of volume handled in the passenger fleet.
  • However, Qantas group still remains as market leader in domestic freight market

Threat of Substitutes

  • Threat of substitute very low for air freight market in Australia, buyers utilize air freight capacity to serve industries such as e-commerce and, courier  and parcel
  • With growth prospective remaining strong for end-user's industry and high dependency on air freight
  • Alternate mode of transport would have very minimum support for e-commerce and the courier and parcel market

Buyer Power

  • Buyers of domestic air freight space is majorly dominated by Australian post and Star courier with more then 70 percent market share
  • Other buyers such as Toll Aviation, TNT and DHL have very minimum bargaining power due to consolidated nature of the market

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