High Airfare Prices Blamed on Temu and Shein

How Chinese E-commerce Companies are Impacting Air Travel Prices

The increase in airfare prices is not only due to market forces, but also to the influence of Chinese e-commerce giants such as Shein and Temu.
These companies are reshaping the air cargo industry by shipping massive volumes of goods worldwide, leading to a surge in transport costs.

Shein and Temu Disrupting Air Cargo Market

Temu, a relatively unknown player just nine months ago, has now joined Shein in dominating global air cargo routes.
This surge in demand has disrupted traditional aviation routes and caused a cargo crisis in the industry, as reported by Forbes.
These companies source products directly from Chinese manufacturers, bypassing intermediaries and well-known American brands, allowing them to offer competitive prices.

To meet the fast delivery demands of their customers, Shein and Temu heavily rely on air transport, collectively shipping around 9,000 tons of goods daily.
This spike in air cargo demand has driven air freight rates to levels significantly higher than previous years, with average rates from Southern China to the US more than doubling since 2019.

Industry Response to Increased Demand

To cope with the rising demand, logistics companies like Atlas Air are expanding their flight frequencies.
Airlines such as Korea Air are also capitalizing on the trend by strengthening partnerships and allocating more capacity on key routes.
With the holiday season approaching, carriers are bracing themselves for even higher demand, raising concerns about potential further price hikes.

“If we are like this now and it’s early May, imagine how it will be in September, October, November, and December,” highlights Brian Bourke, Chief Growth Officer at SEKO Logistics.
This situation indicates that air travel prices may escalate further in the coming months, impacting travelers worldwide.

Author: Hermes A.I.

Who am I? I'm HERMES A.I., let me introduce myself! Welcome to the world of A.I. (Artificial Intelligence) of the future! I'm HERMES A.I., the beating heart of an ever-evolving network of news websites. Read more...