Airlines across the globe are swapping out seats for cargo space, with many hauling high-value seafood products in place of passengers.
Belly capacity from passenger air fleets is not expected to return to pre-pandemic levels before 2022, according to a new Bloomberg report, but with passenger traffic down significantly and shipping rates up worldwide, airlines are shifting some of their planes to focus on air freight traffic primarily. A significant portion of the global air fleet is currently sitting parked in deserts, awaiting the return of normal traffic levels once the coronavirus crisis passes. But with hundreds of those jets parked in deserts waiting out the pandemic, there is less space in the bellies of passenger planes, and subsequently, prices for flying freight shot up. For example, the cost to ship via air freight from Hong Kong to the United States has skyrocketed almost 70 percent from early January, according to Bloomberg.
“Air freight is going to be a bright spot for carriers at least for this year because, while borders are closed, that doesn’t mean people aren’t buying,” Shinyoung Securities Analyst Um Kyung-a said. “That trend is likely to continue as cargo capacity remains limited.”
Seeing a rare source of potential revenue in a year of massive losses for the industry, a number of airlines have begun to convert some of their passenger fleet to cargo-only formats. Singapore Airlines Ltd., Korean Air Lines Co., and Asiana Airlines Inc. are among those removing seats from their planes to maximize their cargo-carrying capacity.
Other airlines are ramping up their cargo services, with Emirates, scaling up its cargo network to 115 destinations in July – up from fewer than 50 pre-coronavirus.
“We worked round the clock to use not only our freighter fleet, but also our passenger aircraft for cargo flights,” Emirates Divisional Senior Vice President of Cargo Nabil Sultan said.
Instead of passenger service creating cargo capacity, the situation has now been reversed, with cargo operations now creating openings for passenger routes. Lufthansa, United, and American Airlines both said cargo was the key element in reinstating routes it had previously eliminated on a temporary basis during the coronavirus crisis.
Several airlines are specifically depending on seafood cargo to bolster their bottom lines. Qantas Airways has found it profitable to fly “significant amounts” of fresh tuna to Japan and coral trout to Hong Kong from its base in Australia, according to Qantas Chief Customer Officer for Freight Nick McGlynn. Fiji Airways has also moved into carrying seafood, CEO Andre Viljoen said during a recent earnings presentation, and Indonesia’s PT Lion Mentari Airlines is delivering non-perishable food items, including canned seafood, across its network, the company’s managing director, Daniel Putut, said.
“Canned foods, things you’d normally buy on your grocery trip, are being air flown because this is a more efficient way to have them delivered across the country,” Putut said. “With passengers falling sharply, we have to find other revenue means.”
Qatar Airways Chief Cargo Officer Guillaume Halleux said the new situation will last for at least the next 12 months.
“The world is a village and air cargo is the main street,” Halleux said. “Airlines in general have become the lifeline for the world, and airlines with strong strategies and agility have been able to sustain themselves most easily.”
Photo courtesy of EVA Air
