Written by Arianna McLimore, Casey Hall, Lisa Barrington
NEW YORK/SHANGHAI (Reuters) – The rapid rise of fast fashion e-commerce retailers such as Shein and Temu is transforming the global air cargo industry. Each air cargo industry is increasingly competing for limited air cargo space to attract consumers with short transit times. This was revealed by more than 10 industry officials.
Shein, PDD Group's Temu, and ByteDance's TikTok Shop, which recently launched online shopping in the U.S., ship most of their products by air from factories in China in individually addressed packages directly to shoppers.
And its growing popularity—according to a June 2023 report from the U.S. Congress, Mr. Shein and Mr. Tem together send almost 600,000 packages to the United States every day—has led to a number of countries including Guangzhou and Hong Kong. is pushing up air freight costs from Asian hubs and increasing off-peak airfares. Officials say the season is almost gone and there is a lack of production capacity.
“Right now, the biggest trend impacting air cargo is not the Red Sea, but Chinese e-commerce companies like Shein and Tem,” said Basile Ricard, director of Greater China operations at freight forwarding company Bollore Logistics. talk.
Temu ships about 4,000 tons per day, Shein 5,000 tons, Alibaba.com 1,000 tons and TikTok 800 tons per day, according to data compiled by Cargo Facts Consulting. This is equivalent to about 108 Boeing 777 cargo planes per day, the consultancy said.
Driven by strong demand for low-priced apparel such as $10 tops and $5 biker pants, Shein alone accounts for one-fifth of the global fast fashion market as measured by sales, and China's e-commerce industry It is said to be promoting the growth of Core site research.
Fast fashion now accounts for half of China's total cross-border e-commerce and about a third of the world's long-haul cargo aircraft, according to cross-border transportation media company Baixiao Net.
Shein and Tem's growth is squeezing space for other industries on air cargo planes, just as the Red Sea disruption has left global companies scrambling to find alternative logistics options.
“When the Suez Canal (crisis) happened, there was no ability to buy, because e-commerce bought everything,” said an executive at an air freight forwarding company, who requested anonymity due to industry sensitivity. .
Sources said air cargo demand from fast fashion began to increase significantly in the second half of last year.
German logistics officials say even big tech companies like Apple only transport up to 1,000 tons a day, and the growing demand for cargo from fast fashion means traditional long-term customers are vying for limited air transport capacity. He said he could be kicked out.
A spokesperson for German logistics company Schenker said some air cargo carriers are responding to increased demand for e-commerce by offering additional charter flights and are “already highly booked for the long term.” “
Apple declined to comment. TikTok Shop did not respond to messages seeking comment.
“Shane is continually optimizing its efforts to ensure the best customer experience and fulfillment efficiency,” a Shein spokesperson said, without providing further details.
Pursuit of capacity
The surge in demand for fast fashion that began last year has increased air freight rates from China, raising concerns about a long-term shortage of shipping capacity.
“From what we have seen so far, this model of (air) e-commerce is not sustainable either from a profit or environmental point of view,” said Guillermo Ochobo, director of Cargo Facts Consulting.
He said that both Shein and Tem are currently focusing on sea transport due to the high cost of air transport, and are considering opening warehouses outside China to reduce transit times to other regions. He said there was.
Shein has started shipping products to warehouses in the United States to speed up delivery times.
Wang Yongqiang, founder of Baixiao, said in a presentation at the Boeing Air Cargo Forum in China in December that the increasing supply of long-haul cargo planes cannot keep up with the growth of cross-border e-commerce. said.
In its 2023 commercial market outlook, Boeing estimated that China's air cargo fleet will more than triple to 750 aircraft from 2022 to 2042, but Boeing declined to comment.
E-commerce companies are looking to secure more capacity directly with airlines, according to executives at a major air cargo carrier and Unique Logistics.
“We understand that Temu is looking to lease 12 widebody cargo aircraft. They are shopping around for every aircraft they can find on the market. We have also received requests for our website. '' he told Reuters.
Tem told Reuters in a statement that it is looking for sellers based in the United States and Europe “to reduce transportation distances and delivery times” for shoppers.
Airlines and freight forwarders are also weighing how much capacity to set aside for Mr. Thame and Mr. Shein's business as shipping volumes and prices fluctuate.
Niall van de Woug, chief air cargo officer at Xeneta, an air and sea freight benchmarking platform, said that while fast fashion brands leave Hong Kong with large volumes of cargo, product volumes are “significantly lower on return.” He said that this was causing a “trade imbalance” that would lead to a “decreasing trade”. Across the Pacific Ocean. ”
The impact of China's emerging e-commerce giants is “game-changing,” Schlossberg said. “They…are emerging as the most important driving force in the industry.”
(Reporting by Arianna McLimore in New York City, Marcus Wackett in Berlin, Lisa Barrington in Seoul, Casey Hall in Shanghai, Sophie Yu in Beijing and Valerie Insinna in Washington; Editing by Miyoung Kim and Matthew Lewis)
