Air Canada; Rachel Premack/Business Insider
Air Canada has ripped out the seats from this plane's economy sections.
- Airlines are flying "ghost planes" where the jets are actually stuffed with cargo instead of passengers.
- As airports report drops in passenger traffic by up to 90%, even airlines that have never flown cargo only, like Southwest, are getting into the mix.
- That may be one of the few business opportunities as much of the economy crumbles - and airlines, in particular, get whacked.
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As airports report passenger traffic drops by up to 90%, airlines are scrambling for a way to keep solvent.
They're also finding an elegant solution: stuffing their jets with packages instead of people.
Typically, American, United, Southwest, and Delta count cargo as a sliver of their revenues - as low as 0.7% for Southwest and as high as 2.7% for United. It's now becoming the only source of growth as travel restrictions and coronavirus fears leave passenger cabins largely empty.
Cargo flying has become a suddenly lucrative business since the coronavirus pandemic halted passenger travel. According to freight data and media company FreightWaves, the air-cargo price index for flying from Shanghai to North America has increased by nearly 80% to the first week of April 2020 from the same period last year.
Rates to fly cargo from Hong Kong to North America cargo are up nearly 40% over the same period, according to FreightWaves data, and Frankfort to North America rates increased by around 61%.
The reason for these sky-high rates actually connects back to passenger flights. Some 80% of cargo between Europe and North America flies in the "belly" of a passenger jet. But with these flights canceled, retailers are scrambling for new ways to get their goods in stores.
Their increased demand has driven up prices, and it's ticked up the overall travel time - which is part of the reason that, say, your Amazon order is scheduled to come in a few weeks rather than a few days. Last month, Neel Jones Shah, who is the head of air-freight operations for freight startup Flexport, told Wired that Hong Kong to Chicago cargo-transit times are up to five to eight days, up from the typical wait of three to five days.
On top of that, retailers and hospitals are demanding quick restocking of essential goods like masks and hand sanitizers.
Reuters
To keep planes from rotting, airlines are stuffing jets' bellies with cargo.
As a result, airlines are racing to fly "ghost planes" with just cargo in the belly, operating them as charters without even trying to sell passenger tickets. Another popular option is to send their excess jets to temporary storage.
These companies are flying cargo-only for the first time in decades - and, for some, the first time ever.
Delta Air Lines began flying cargo-only flights to Europe, Asia, and Australia in March with its largest jets. Starting April 14, Delta is expanding the service and flying daily cargo-only services between Asia and Detroit. It's the first time since 2009 that Delta has operated cargo-only flights.
American Airlines is similarly began operating cargo-only flights in March, including locations across North America, Europe, Asia, and South America.
This is American's first regular cargo-only operation since 1984, when it operated a dedicated cargo fleet.
Meanwhile, United is operating 40 cargo-only charter flights per week starting with flights between Chicago and Frankfurt on its largest jets, and Southwest is flying its first cargo-only services in company history.
Southwest hasn't revealed the details on its cargo-only services, the first in its 50-year operations. Its Boeing 737 series aircraft have a lower cargo capacity than the larger jets and are limited to North America, unlike the other big airliners, but are still seeing a demand.
The trend is being replicated around the world, with Air Canada taking an extra leap and converting three of its largest planes to be truly cargo only by removing the economy and premium passenger seats to hold additional light-weight boxes. This won't be a full conversion to cargo, which can take as long as a year.
It's a lengthy process - but Air Canada's investment into converting planes, along with the uptick in cargo flights across the rest of the industry, shows how certain airlines are that passengers aren't coming back anytime soon.
Tom Pallini contributed to reporting.