Over the past 10 years, U.S. consumers have paid no duty on shipments valued at $800 or less, causing the volume of cross-border packages into the U.S. to soar to some 1.35 billion annually. As of May 2, however, low-value products sourced from China and Hong Kong into the U.S. will be subject to 145% new tariffs, with products sourced from postal services paying a different 120% duty on the value of the goods or a $100 flat fee, rising to $200 on June 1.
Approximately 50% of air cargo shipments on the China–U.S. route is e-commerce, accounting for around 6% of global volumes. A sharp drop in demand is likely to challenge carriers’ capacity planning, with early signs already pointing to freighter flight cancellations and potential redeployments to other trade lanes.
“This may be a year when we grow weary of seeing the word ‘unprecedented’ in market performance statements,” says Niall van de Wouw, Chief Airfreight Officer at Xeneta. “The macroeconomic picture will depend on how long the uncertainty lasts and what will be at the end of it, but the outlook currently looks quite daunting.
“This is not about one industry being affected. This is about major trade lanes being affected, and we haven’t seen anything on this scale before,” van de Wouw added.
Read more in an article from Air Cargo Week
