Summary:
- Projected global GDP growth to remain stable at 3.2% in 2025
- Global inflation expected to fall to 4.3% in 2025
- Semiconductor demand growth will fuel ‘traditional’ air cargo demand
Double-digit global demand growth in 2024 has been primarily driven by emerging and sudden market forces, such as the rise of e-commerce in China and conflict in the Red Sea, rather than what many people would consider to be the ‘traditional’ air cargo market.
This traditional air cargo market - predominantly B2B goods that have been shipped by air for many years on established corridors - remained muted in 2024, but that is likely to change in the year ahead.
Growth in semiconductor demand
A rebound of the traditional air freight market will be supported by demand for semiconductors related to generative AI and advanced computer processing.
SEMI (industry association for semiconductors) has estimated global shipments of silicon wafers – a fundamental material in the manufacture of most semiconductors and associated electronic devices - will grow around 10% in 2025, following an estimated 2% decline in 2024.
With the majority of semiconductor materials shipped by air freight, this will fuel the growth of air cargo demand, particularly on corridors out of Asia.
Impact of GDP and inflation on air freight demand
Air cargo demand growth in 2025 is further supported by sustained global GDP growth.
The International Monetary Fund (IMF) has projected global GDP growth to remain stable at 3.2% in 2025, on par with 2024.
Sustained GDP growth will support growth in air freight demand in 2025, but disinflation (the slowdown of inflation) will also be key.
The IMF projects global inflation to fall to 4.3% in 2025, down from 5.8% in 2024, with advanced economies returning to their target inflation levels sooner than developing markets.
Stabilizing goods prices will support consumer spending, which then ripples through air freight. Elevated wage growth, which is in part driving elevated services price inflation, is also expected to ease in 2025.
However, disinflation could be disrupted by rising commodity prices resulting from geo-political trade tensions and labor shortages due to US immigration control.
“The AI wave will lift the recently-stagnant B2B airfreight market. But this will not have as dramatic an impact on global demand when compared to factors in 2024 such as Red Sea Crisis and the rise of e-commerce.
Shippers on corridors with lower demand growth are still at risk if airlines remove capacity from secondary trades to meet the increasing demand out of Asia.”
Wenwen Zhang
Air Freight Analyst, Xeneta