by Joey Smith, Director of Aviation Services at Cassel Salpeter

On April 2nd 2025, “Liberation Day”, President Trump introduced new sweeping tariffs via Executive Order on America’s global trading partners, upending the international commercial order with a snap of his fingers. This protectionist shift marks a stark departure from the globalist and free trade principles that elevated the United States during the latter half of the 20th century to become the world’s largest economy and its wealthiest nation, despite growing trade deficits and a ballooning national debt. Recent economic pressures such as inflationary risk, shrinking growth forecasts, and declining consumer confidence persist; which has led many to reconsider planned investments and spending.For more in depth analysis, check out Cassel Salpeter’s Aviation Report- available for free download.

These new duties have put significant pressure on the U.S. economy and its thriving aviation industry. The timing proves particularly challenging for the U.S. aviation industry, which was reaching for new heights in 2025, with revenues projected to exceed $1 trillion for the first time. The air cargo sector faces major headwinds within this evolving tariff environment. The elimination of the longstanding $800 de minimis exception for imported goods, combined with increased tariffs, is expected to send air cargo volumes plummeting for low-value e-commerce shipments: a major component of China-U.S. airfreight traffic. Cargo airlines must navigate an increasingly complex landscape of disrupted trade flows as manufacturers and retailers reconfigure supply chains in response to new levies. This will reshape network planning, capacity deployment, and aircraft acquisition strategies among other challenges.

New trade policies introduced by the United States have ushered in a challenging period for the aviation industry, particularly the air cargo and freight sector. The industry was set to build on a record 2024 performance with strong prospects for 2025 and beyond. It would be unfortunate and counterproductive to destabilize this important industry and its complex ecosystem, and we are hopeful that new international trade agreements can be reached with common sense exemptions and reduced levies. Until tariff uncertainties are resolved, it remains difficult to forecast the future of the industry and supply chains. We are cautiously optimistic that the industry will be able to adapt with new routes and strategies to weather the storm, executing a smooth landing after tariff turbulence.

Joey Smith has more than 25 years of experience in the capital markets and securities industry in South Florida.