Air Freight: Shanghai Pudong Airport (PVG) status update

Airport updates

• Ground handling capacity at PVG is currently at approximately 60-70% of the normal level, and will remain at this level in the coming weeks.
• Due to the COVID-related restrictions imposed by the Chinese government, all Chinese airports are having similar manpower issues at ground handling operations. Alternative airports of PVG, including Beijing (BJS) and Zhengzhou (CGO) are facing bottlenecks in terms of handling capacities.
• For China inbound traffic, there are congestion problems at major export airports including Amsterdam (AMS), Liège (LGG), Paris (CDG), Frankfurt (FRA), Hahn (HHN), and Chicago (ORD). These airports, which are having a considerable volume of export shipments to China, are facing problems of full warehouses at freight forwarders, handling agents and airlines due to the continuing accumulation of cargo that cannot be flown to China in a timely manner.

PVG overall market impact

• The PVG incident has taken an unfortunate and very dynamic development to the global transport logistics market.
• This issue is not affecting specific forwarders only or a single airport but the entire industry is being affected including shippers, freight forwarders, airports, airlines and ground handling companies.
• There are now significant challenges due to the backlog situation at both import and export, thus bringing far-reaching influences on the entire global supply chain.
• Some forwarders temporarily stopped accepting additional freight volume due to the lack of cargo capacities and the tremendous backlog volumes.
• With capacity shortage, the demand for air freight is skyrocketing in combination with pre-holiday rush due to China’s Mid-Autumn Festival followed by the Golden Week holiday and the troubled sea freight market.
• On top, the traditional peak season is imminent, when increased production by the fashion and sports industries and annual releases by well-known smartphone and gaming device manufacturers will dramatically increase the demand for capacity. We expect that the rise in demand will not change until end of 2021.
• As a result of the above, the situation of the air freight market will remain extremely tense, and rates are likely to increase further in Q3 and beyond.

Currently, DACHSER’s network capabilities for air freight transports stay robust and resilient and we are working restlessly to keep it that way.

If you are having upcoming shipments to and from China, please get in touch with your DACHSER representative to discuss and plan ahead so that we can help to minimize any disruptions to your supply chain.

Should you have any questions, please get in touch with your usual local contact who will be happy to assist you.