
Cathay Pacific expects freight decline on US routes due to new tariffs
Cathay Pacific airline expects a decline in demand for air cargo on its routes between China and the United States. The company cited the impending new tariffs between Washington and Beijing, which are due to come into effect in May, as the main reason. As a result of this development, the airline plans to increasingly redeploy its freighters to other routes. Cathay Pacific stated that the ongoing tariff situation, combined with the abolition of the so-called de minimis rule from May, is expected to lead to a decline in air cargo volumes between mainland China and the USA. This rule previously excluded the imposition of import duties on goods valued at less than US$800 and was used extensively by Chinese e-commerce companies such as Shein and Temu. The current abolition of this exemption means significant changes for these companies and their logistics partners. Cathay Pacific has benefited from the strong growth of the e-commerce sector in China in recent years and has recorded correspondingly high cargo volumes on its trans-Pacific routes. The airline expressed concern that the changed trade tariffs could not only affect cargo demand, but also potentially impact travel demand, leading to rising costs and strains on global supply chains. Other airlines with significant cargo business between China and the US are expected to consider similar capacity adjustments. Cathay Pacific's response to increase its cargo capacity on other routes indicates a strategic reorientation to offset the expected losses on its US routes. The airline has not yet disclosed in detail which routes this will affect.