Expeditors expects disruption in 2025 after strong Q4 for airfreight
US freight forwarder Expeditors reported a strong end to the year for its airfreight business but added the market is facing "disruption at a faster pace than we can ever recall".
The Washington-headquartered firm reported a 22.7% year-on-year increase in fourth-quarter air cargo revenues to $1.1bn on the back of an 11% increase in air cargo volumes.
The company said that the improvement in air cargo revenues was driven by the higher demand and also increased rates due to limited capacity.
Outlining the market, president and chief executive Jeffrey Musser - who today announced his retirement - said there was “strong demand from Asia, along with heavy de minimis-driven e-commerce business and increased demand for technology products" as well as "limited access to air capacity".
"All of our primary businesses performed very well again in the fourth quarter and we moved more air tonnage than we have since Q4 2021. Strong demand out of Asia drove rate increases and segment growth in both the quarter and during the second half of 2024."
He added: "Growth in air and ocean shipments helped drive an increase in fees for customs declarations and services. We also grew our road freight and warehousing and distribution businesses during the quarter."
For the full year, airfreight revenues increased by 13% to $3.7bn. Overall revenues for 2024 increased 14% to $10.6bn, operating income was up 10.8% to $1bn and net earnings were up 8% to $811.6m.
Looking ahead, the company said it had limited visibility on how the market would perform.
"It is extremely difficult to predict the impact to global air supply and demand that may result from actions such as the anticipated US elimination of certain de minimis exemptions," said Musser.
"So, too, whether recessed Red Sea hostilities will lead to resumed ocean transit via that route remains to be seen. Geopolitical words and action are driving disruption at a faster pace than we can ever recall, and national policies regarding tariffs and other similar measures are highly unclear in many countries around the globe.
"However, whether accessing scarce capacity or navigating increasingly complex customs requirements, we believe we are at our finest during chaotic times like these. We remain flexible and steadfastly focused on serving our customers to keep their freight moving across borders during such unpredictable times.”