News / Asia-Europe shippers eye multimodal routes as airfreight costs soar

Photo: © Iryna Kushnarova, Dreamstime.com

The surge in airfreight costs and the disruption of schedules from the Middle East conflict has prompted shippers in Asia-Pacific to explore sea-air routings via the US west cost for shipments to Europe.

While this does not appear to be a strategic shift, lasting cost pressure from aviation fuel supply could stretch the approach for some time.

“We are seeing structured offerings from certain forwarders and carriers, routing cargo from Asia to Los Angeles by ocean and then onward to Europe by air,” reported Kenneth Leung, VP of global sales and marketing at Dimerco Express Group.

“We have seen a noticeable increase in inquiries for this multimodal solution, which DHL Global Forwarding has been offering to our customers for several years,” confirmed Fabio Weiss, SVP airfreight at DHL GF Asia-Pacific.

The interest in sea-air has been fuelled by the soaring airfreight rates triggered by capacity reductions and surcharges, especially on fuel, the price of which has roughly doubled since the outbreak of hostilities in the Gulf. According to World ACD, the average airfreight rate out of Asia-Pacific was $5.14 per kg in the week ending 19 April, 41% higher than a year earlier.

“The shift is driven by a combination of factors,” Mr Leung commented. “Elevated airfreight rates, including fuel surcharges, are a key driver, but not the only one. At the same time, ocean freight transit times on Asia–Europe routes have been significantly extended due to Red Sea disruptions, in some cases exceeding 50 days. This creates a gap where neither traditional ocean nor air solutions are optimal. Sea–air provides a middle-ground alternative, balancing cost and transit time under current market conditions.”

Transit times range from 20 to 30 days for well-orchestrated shipments, but can be stretched by port operations, handling efficiency and capacity availability at the US gateway, Mr Leung noted.

According to him, on expedited services the ocean leg to the US takes 16-18 days, while the air transport portion is 1-2 days to a major European gateway, followed by 3-4 days for final delivery.

“The critical variable is the transloading and transfer process at Los Angeles. For FCL shipments, moving cargo from the port to airfreight typically takes around 2 to 5 days, while for LCL shipments, the CFS handling and consolidation process can take 5 to 7 days,” he said.

Demand for the sea-air routing has been strongest from North Asia and from parts of South-east Asia – notably Vietnam, Thailand, and the Philippines, Mr Weiss said., while Mr Leung noted that Chinese firms had shown less appetite, as the rail service to Europe remained a well-established and competitive option.

Sea-air to Europe has found traction across a broad spectrum of cargo owners, especially companies in the retail, fashion, consumer goods and technology verticals, Mr Weiss said. These are sectors where speed-to-market matters, but pure airfreight costs are increasingly difficult to absorb,” he added.

“We see the strongest fit in sectors such as ecommerce, electronics, and consumer goods – particularly for shipments with relatively high value density and larger volumes. It is also suitable for LCL cargo where flexibility and consolidation play a role,” Mr Leung said.

Both executives doubt that the sea-air routing to Europe via the US will become more than a temporary, tactical option for shippers.

“Most activity is still exploratory or driven by specific customer requirements rather than a broad shift in routing strategy. Overall, we view this as an emerging, situational solution rather than a mainstream option today,” Mr Leung commented.

“The current uptick is likely opportunistic rather than structural, as customers are using it selectively to navigate short‑term cost and capacity challenges, rather than as a permanent shift in supply chains,” added Mr Weiss.

On the other hand, the cost pressure on air transport will remain a factor for some time to come. Energy industry specialists have stressed that oil prices will not drop to pre-conflict levels once the hostilities in the Middle East end.

To begin with, the deployment of temporary buffers (primarily national stockpiles) has delayed the full impact of the disruption to oil supplies. Moreover, depleted supplies will take time to replenish, as it will take months for oil production to ramp up to February levels. All of this points to significantly elevated oil prices – and airfreight costs – for months to come.