Freight forwarders are rushing to manage an unexpected surge in air cargo demand on westbound trans-Atlantic routes as shippers expedite shipments ahead of new U.S. tariffs on European goods, set to take effect on April 2.

This heightened demand is pushing air freight rates upward, with prices climbing 8% this week to nearly $5 per kilogram—levels last observed during the peak shipping period before Lunar New Year in January.

According to Niall van de Wouw, chief air freight officer at Xeneta, volume from Western Europe to the U.S. increased by 11% year over year in early March, significantly exceeding global average demand growth. The dynamic load factor for that period stood at 76%, reflecting tight market conditions.

Martin Habisreitinger, COO for air freight at Hellmann Worldwide Logistics, attributed the rise in trans-Atlantic air cargo primarily to the automotive sector.

“This spike is directly linked to the impending tariffs, with shippers accelerating their shipments to sidestep the new duties,” Habisreitinger told the Journal of Commerce on Tuesday.

Last month, U.S. President Donald Trump announced a 25% tariff on imported cars, set to take effect on April 2. This follows the recent imposition of a 25% tariff on steel and aluminum imports, including those from the European Union. The EU has responded with its own countermeasures, introducing a 25% tariff on American whiskey starting April 1. In retaliation, Trump has threatened to impose a 200% tariff on European wine and spirits, labeling the EU’s trade stance as “hostile and abusive.”

Loic Gay, global air freight leader at CEVA Logistics, noted that trans-Atlantic demand is also being fueled by U.S. restocking efforts.

“Flights are expected to run at full capacity, and air freight rates are likely to remain high, particularly for main deck cargo space,” Gay said.

A significant challenge for trans-Atlantic air freight remains the sharp reduction in freighter capacity compared to last year, estimated at 2,000 tons per week. Many carriers have redeployed freighters to the Asia-Pacific region to support booming e-commerce demand.

While shippers rush to move goods ahead of the tariffs, the trade environment remains unpredictable.

“At present, there is strong ad hoc demand for air freight from Europe to the U.S., and we hope this trend continues, but market conditions are highly uncertain,” said Holger Ketz, global head of network and carrier management at Kuehne + Nagel.

Habisreitinger echoed this sentiment, citing trade disputes and geopolitical factors as contributors to market volatility.

“We expect the current peak in demand to ease toward the end of March as the new automotive tariffs take effect,” he said.

Relief may be on the horizon as airlines implement their summer schedules on April 1. While winter schedules typically reduce flight frequencies, summer schedules bring additional widebody passenger flights, increasing available belly cargo space.

“With the transition to summer schedules, we anticipate an increase in trans-Atlantic flights, which should alleviate capacity constraints and provide more predictable planning,” Habisreitinger noted.

Van de Wouw added that the additional capacity from summer schedules typically lowers load factors on Europe-U.S. flights by 10% to 20%, depending on the route.

Gay expects a recovery in passenger plane cargo capacity, while Ketz mentioned that Kuehne + Nagel is finalizing summer schedule plans with airlines.

“However, predicting this year’s capacity needs is particularly challenging, and we must strike a balance between our dedicated and commercial capacity,” Ketz said.

 

Source: joc.com