Structural shifts, policy shock the US cargo market

[vc_row][vc_column][vc_column_text css=""] Alaska and Hawaiian Airlines broke away from the field after their merger was finalized in late 2024, as seen in Figure 1 below. The combined airline immediately became the largest domestic freight mover, with tonnage accelerating sharply in early 2025. A majority of that surge is due to Hawaiian’s fleet of ten A330-300P2Fs operating under its agreement with Amazon, all of which are now in service. Alaska Airlines new scale lets them dominate high-volume domestic lanes while also offering consistent capacity and tighter schedules for e-commerce shippers who demand both speed and reliability. Figure 1 – US Domestic Tonnage by Major Carrier

Alaska Airlines are also extending its reach internationally. New, nonstop freight services from Seattle (SEA) to Tokyo Narita (NRT) began in May, with Seoul Incheon set to follow in September, both operated with widebody aircraft. The A330s are being used flexibly ( Figure 2 ) across the network, with heavier deployment on domestic routes while also enabling international growth. By unifying booking, co-locating stations, and coordinating gateways, the combined carrier has created a network with greater flexibility and reach than either could achieve on its own. Figure 2 – Hawaiian Airlines Domestic A330 Freighter Network June 2025

Sun Country Airlines has also emerged as a domestic force, moving even more freight than United Airlines in May as seen in Figure 1 . Sun Country’s growth is tied to its Amazon partnership, which expanded through 2024 and has ramped up in 2025. The airline hit its target fleet of twenty 737-800 freighters in September, with volumes in Figure 1 showing a steady upward trajectory. Amazon’s focus on reliable, dedicated lift has protected Sun Country from volatility and established its role as a specialist in domestic e-commerce freight. The legacy majors tell a different story. United and Delta Airlines maintain solid tonnage but show limited growth. Southwest holds steady, while American Airlines continues to trail, struggling to recover share in a domestic market that increasingly favors carriers with dedicated freighters and structural advantages. Modest gains in international bellyhold When looking at international cargo in and out of the U.S., the dynamics are more stable. Figure 3 shows United, Delta, and American continuing to dominate international volumes to and from the U.S. in 2025. These carriers benefited from the full restoration of long-haul networks, particularly across the Atlantic, where bellyhold capacity returned to pre-pandemic levels. Figure 3 – International Tonnage by Major US Carrier

Policy and trade developments have shaped this stability. Tariffs imposed in 2022 and 2023 reduced demand for specific goods from China, visible in earlier dips. A rebound in mid-2024 matched a trade agreement that improved predictability for e-commerce and digital goods moving between the U.S. and Europe. Entering 2025, the data shows increased seasonal volatility and modest growth with sharper spikes as forwarders front loaded pre tariffed inventory in the first half of the year. The data through May 2025 reinforces the earlier trend of steady growth supported by pre-tariff inventory movements and seasonal swings. The July IATA cargo report pointed to a 5.5% year-on-year rebound in demand after a softer June, alongside a 3.9% increase in capacity. Rates, however, remained under pressure as export orders weakened and industrial production slowed down in several markets. Taken together, the results suggest that the market is entering a more uneven phase, with sharper fluctuations likely in the months ahead as tariff adjustments, low-value import rules and shifting global trade conditions feed into airfreight demand. Asia-Pacific volatility FedEx and UPS consistently move 20,000 to 30,000 tons per month, overshadowing the volumes of passenger airlines, but late 2024 and early this year has been anything but steady. Figure 4 below captures Asia – U.S. flows, and highlights the outsized role of the integrators. Figure 4 – Asia/US Air Freight Tonnage by Major US Carrier

A dip in late 2024 corresponds with tariffs on semiconductors and electronics, which reduced demand for transpacific capacity. The rebound in early 2025 aligns with pre-tariff front-loading, as integrators like FedEx and UPS rushed to move shipments before the U.S. de minimis exemption was removed for China and Hong Kong in May. That change ended duty-free treatment for low-value imports from those markets, driving a short-term surge in volume. But once the new rules took effect in May, demand quickly fell off, and FedEx and UPS both saw measurable declines in Asia – U.S. flows heading into the summer. The August suspension of the de minimis rule for all countries is expected to reinforce this pattern, with more volatility likely as shippers reconfigure supply chains. Passenger carriers remain far less affected. United, Delta, and American move freight primarily in passenger bellyholds, where volumes are tied more to broader trade flows and alliance networks than to the low-value parcels most impacted by de minimis. Their monthly tonnage remains modest compared to integrators, but because their business is focused on bulkier shipments and scheduled passenger operations, they have not been affected by the sharp swings in demand that hit FedEx and UPS. International flow less predictable As air cargo demand expands, dedicated freighter fleets are capturing the bulk of the growth. Sun Country reached a fleet of twenty Boeing 737-800 freighters in 2025 and surpassed United in tonnage by a significant margin in May, showing how quickly new entrants with focused strategies can climb the ranks. Alaska, strengthened by Hawaiian’s freighter integration, continues to build scale in both domestic and near-international markets. Both airlines have turned that scale into financial results, with Sun Country posting double-digit cargo revenue growth and Alaska reporting sharp year-on-year gains from its freighter operations. On the international side, policy changes are beginning to filter into the data, creating more volatility across global flows. The removal of de minimis thresholds and renewed tariff measures have already produced visible shifts in integrator volumes, while legacy carriers have held steadier thanks to diversified passenger networks and long-haul alliances. Rather than sharper peaks on trans-Pacific lanes, the more likely outcome is an uneven pattern of growth, with fluctuations in demand tied to regulatory changes, shifting sourcing strategies, and evolving trade agreements. These pressures are set to make international cargo flows less predictable in the months ahead.[/vc_column_text][/vc_column][/vc_row]

Structural shifts, policy shock the US cargo market

The U.S. domestic cargo market looks very different in 2025 than it did just a year ago, as freighter fleets capture e-commerce demand. International markets, meanwhile, are evolving under very different pressures.

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