Apple still changing the world

Apple now largest air cargo shipper in the world

Mike King

Mike King is a Fool.com.au Investment Analyst and Writer. He caught the investing bug more than a decade ago, at a time when the U.S. had invaded Iraq and fear reigned in the markets. His initial success as the markets took off encouraged his passion and thirst for knowledge. With 13 years behind him at one of Australia's largest domestic banks, Mike's passion for stocks led him to join a boutique funds management firm, where he stayed for four years. A seven-year stint in equity research at one of the largest investment banks in the world followed that, giving Mike a thirst to pursue his passion further. Mike holds a Diploma in Applied Finance and Investment and a Graduate Certificate in Financial Planning. His passion is to help retail investors invest better, and that passion was one of his primary reasons for joining The Motley Fool Australia in late 2011. Mike has written thousands of articles since joining, including for Fairfax Media, Yahoo!7, Ninemsn and has also appeared on ABC's The Business. You can see all of Mikes' holdings here

Published October 12, 2012 3:55 pm AEDT

It seems the iPhone 5 is revolutionising much more than just the smartphone market. Air cargo companies have seen an increase in cargo volumes tied to the launch of various smartphones and computer tablets, according to the US Federal Reserve.

Transport experts have reported that launches of Apple products have become huge business for the air cargo industry, and helped the sector bounce back from a collapse in prices. Many companies have cut spending by shipping products by sea rather than air.

The indicative average cost of air freight from China to the West had risen 7% between August and September, and likely to rise higher in the wake of the iPhone 5 launch, according to Martin Dixon of the British freight research firm Drewy.

He added that smartphones now make up a large part of airfreight goods, and that a key part of Apple's strategy was to secure air cargo capacity when it launches new products.

Apple is now rumoured to be the biggest air cargo shipper in the world, according to research firm, Transport Intelligence. With 5 million iPhone 5s sold in the first three days after the product launched, and a forecast of around 50 million iPhone 5s to be sold in the last quarter of this year, you can see why.

While iPhone 5 sales are enormous, the sale of accessories for the smartphone are likely to be just as large. Rumours that the new phones scratch easily should see a jump in protective covers and cases, especially as the new phone is taller and thinner than previous versions. The new 'lightning' connector socket should see a brisk sale in adaptors, as users won't want to throw out speakers, stereos, radios, alarm clocks etc that came with a built in connector for the old socket. Many hotels, for example, are likely to have a stereo/radio in each room with an old version of the iPhone dock connector.

That should be good news for Apple accessory sellers such as JB Hi-Fi Limited (ASX: JBH), Dick Smith, Officeworks – owned by Wesfarmers Limited (ASX: WES), David Jones Limited (ASX: DJS), and Myer Holdings Limited (ASX: MYR). The sheer volume of sales should help their revenues – as long as they don't have to pay the air freight charges!

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Motley Fool writer/analyst Mike King owns shares in David Jones and JB Hi-Fi. The Motley Fool's purpose is to help the world invest, better. Take Stock is The Motley Fool's free investing newsletter. Packed with stock ideas and investing advice, it is essential reading for anyone looking to build and grow their wealth in the years ahead. Click here now to request your free subscription, whilst it's still available. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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