Logistics news

Potential Crisis: Global Air Freight Faces New Wave of Tariffs

Global Air Freight Faces Major Challenges Amid New U.S. Tariffs

The global air freight industry is bracing for unprecedented challenges as the U.S. government reinstates tariffs on hundreds of imported goods from China and expands countermeasures to other trade partners. This policy shift not only increases supply chain costs but also threatens the fragile recovery of the air cargo sector, which is still struggling to regain pre-pandemic levels.

According to FreightWaves, the termination of tariff exemptions on more than 350 Chinese goods could lead to a global logistics revenue loss of up to USD 22 billion in 2025—air freight being the hardest hit due to the high-value and time-sensitive nature of the cargo.

Ripple Effects on the Air Freight Supply Chain

The end of U.S. tariff exemptions is triggering a domino effect throughout the global logistics network. Logistics providers are being forced to re-evaluate long-term strategies, particularly as international shipping demand declines. The International Air Transport Association (IATA) reports a 6% drop in global air cargo volumes in Q1 2025 compared to the same period last year.

At the same time, rising operational costs are straining the industry. According to Xeneta and TAC Index, air freight rates from China to the U.S. surged over 20% in the first two months of 2025, reflecting urgency from shippers rushing to avoid new tariffs and dealing with ongoing supply chain disruptions.

Airlines are also under pressure from high fuel prices and labor shortages, leading to route reductions and capacity constraints. Major carriers like FedEx, UPS, Lufthansa Cargo, and Cathay Pacific have reduced flights on weaker routes and prioritized high-margin cargo such as electronics, pharmaceuticals, and industrial components.

Logistics Firms Confront a Survival Test

As global supply chains shift rapidly, freight companies are now facing a survival challenge. The U.S.-China tariff war is accelerating the movement of production to emerging markets like Vietnam, India, Mexico, and Eastern Europe—posing both an opportunity and a disruption for traditional air freight routes.

In response, many logistics providers are expanding their air freight services in emerging regions. Industry leaders such as DB Schenker, Kuehne+Nagel, and DHL Global Forwarding are investing in multimodal transport solutions, combining sea and air to offer cost-effective alternatives amid soaring air freight rates.

Digital transformation is also a key response. Platforms like Flexport and Project44 enable real-time cargo tracking, optimize routing, and reduce unnecessary costs—offering a competitive edge to logistics firms ready to adapt.

Future Outlook: Restructuring and New Growth Paths

Looking ahead, industry experts forecast continued volatility in 2025. If U.S. tariffs expand to include other partners like the EU or India, global air cargo volumes may decline another 3–5% by year-end. To stay competitive, logistics firms must rethink their strategies—diversifying trade lanes, expanding into new markets, and embracing innovation.

Still, these disruptions may also unlock new opportunities. As multinational companies seek to relocate production outside China, demand for air freight in regions like Southeast Asia, South Asia, and Latin America is expected to rise. For companies like YGL Logistics Vietnam, this is a critical time to invest in network expansion and service upgrades.

YGL Logistics Vietnam: Ready for the Challenge

At YGL Logistics Vietnam, we recognize the urgency of these changes. With extensive regional expertise, agile service models, and a commitment to technology-driven logistics, we are well-positioned to support businesses navigating this evolving landscape. From strategic air freight planning to multimodal solutions, we are your trusted partner for reliable, efficient, and cost-optimized cargo movement.