News / Tariffs, trade shifts, and aircraft shortages test air cargo resilience

Brendan Sullivan, IATA’s director of cargo and Julia Seiermann, head of industry analysis. Photo - IATA

Air cargo has emerged as the world’s shock-absorber in 2025, IATA said this week, as the sector scrambles to keep goods moving through a storm of tariff hikes, fractured tradelanes, and crippling aircraft fleet constraints.

Escalating tariffs, especially from the US, where average import tariffs surged to 17%, were at their highest since 1933 according to IATA, triggering rapid shifts in global supply chains.

Companies were forced to reroute production, adjust sourcing, and change distribution patterns at unprecedented speed. Air cargo emerged as the primary shock-absorber, providing the responsiveness required to keep goods moving as trade policies changed with little notice.

Trade fragmentation surged this year, particularly between major economies such as the US and China, forcing companies to rethink sourcing, manufacturing, and distribution.

And while overall trade growth has slowed, IATA noted that air cargo had been able to adapt rapidly to new routes and surging demand for high-value goods – although structural constraints threaten future agility.

“We’re very much operating in a world where tariffs and trade tensions are reshaping global supply chains,” said Brendan Sullivan, IATA’s director of cargo, at the global media day in Geneva. “Goods that once followed stable routes are now moving through new corridors, sometimes shifting quickly as tariff policies change.”

He added: “Global trade is no longer predictable. Tariffs, geopolitical tensions, and supply chain diversification are reshaping routes and volumes almost overnight.”

Businesses responded with a surge in shipments ahead of tariff implementation in April, followed by rapid rerouting to alternative markets.

Julia Seiermann, head of industry analysis, noted that China’s trade flows illustrated this trend clearly: exports to the US fell more than 15%, but were more than offset by redirected shipments to Asia and Europe; typically routes heavily supported by air cargo.

Air cargo’s quick response led to strong results in 2025. Cargo tonne-km reached an all-time high of 25.4bn in October, driven by surges on routes from the Far East to Europe. Meanwhile, traffic on the Far East–North America corridor, affected by US tariffs, declined slightly, illustrating how quickly air cargo can pivot to new trade flows.

The outlook for 2026 remains positive, but moderated. IATA expects global cargo traffic growth of 2.6%, down from 3.1% this year, even as global trade growth slows to just 0.5%. The sector continues to benefit from demand for AI-related goods, high-value and time-sensitive products, and the structural shift towards ecommerce.

Regional growth remains strongest in Asia Pacific and Europe, with Africa and Latin America also expanding, while North America faces continued declines due to tariffs. The Middle East is stabilising after exceptional 2024 growth linked to maritime disruptions in the Red Sea.

Capacity constraints remain a critical challenge. Global aircraft shortages are limiting fleet growth, the overall backlog exceeding 17,000 aircraft, equivalent to 60% of the active fleet. Airlines have extended the operational life of older aircraft and slowed passenger-to-freighter conversions.

“Airlines have pushed the utilisation of the fleet to historic highs,” Ms Seiermann said. While this may sustain profits in the short term, it increases maintenance costs and reduces fuel efficiency, leaving the industry vulnerable if older aircraft need retiring faster than replacements arrive.

Slot access at major airports is adding further operational pressure.

Mr Sullivan highlighted that cargo carriers frequently struggled to obtain historic or permanent airport slots, with hubs such as Bogota, Dubai, Heathrow, and Gatwick restricting cargo to temporary or ad hoc allocations. Local rules, including curfews, parking limits, and outright bans at some airports in cities like Mexico City and Mumbai, compound the challenge.

“The slot disadvantages stem from local rules, not international standards,” Mr Sullivan added. IATA is pushing for alignment with its Worldwide Airport Slot Guidelines to ensure fair, transparent access across passenger and cargo operations.

Meanwhile, developments in maritime shipping are affecting air cargo demand in the Middle East. As containerships gently resume regular transits through the Suez Canal, air cargo volumes in the region have begun to ease.

As Mr Sullivan noted: “If ships continue even more [through Suez], that will reduce the demand for air cargo.”