Cargo Currently The Lifeline For Many Airlines
The COVID-19 pandemic has led to a tale of two air transport industries: a passenger business that has nearly collapsed—with years expected before a full recovery occurs—and a cargo business that has demonstrated exceptional resiliency and is expected to post double-digit year-over-year (YOY) percentage traffic growth in 2021.
Aviation Week data showed that non-package cargo carriers utilization hit new highs in mid-November 2020.
However, the sector is still facing a shortage of capacity with many long-haul passenger flights remaining grounded, removing belly capacity from the market. Before the pandemic, about half of the world’s air cargo traffic was carried in the bellies of passenger aircraft, which provided a depth of network reach that freighters do not.
To meet air cargo capacity demand, a number of carriers turned grounded passenger aircraft into freighters, either by placing cargo securely on empty passenger seats or by removing the seats to create de facto second cargo decks on fuel-efficient mainline aircraft, such as the Boeing 787.
Total passenger airline revenue generated from cargo is expected to increase to about 33% of total revenue this year, up from 12% before the pandemic.