Cargo at Delta continues losing streak into Q3

Cargo revenues at Delta fell 15 percent year-on-year (y-o-y), or US$29 million in the third quarter, to $167 million, pushing revenue for the first nine months of 2016 down 20 percent, or $126 million, to $494 million.

These low numbers don’t factor extensively into Delta’s overall results however, with cargo constituting only 1.6 percent of the carrier’s operating revenues. The airline benefitted from low fuel prices, which offset rising labor costs and diminished ticket prices for a third-quarter profit of $1.26 billion, down 4 percent over the same period 2015.

However, Delta’s poor performance is not reflective of broader market conditions for cargo. Many of the world’s major cargo carriers and airports have now reported their September results, and the news is almost uniformly good. For example, Delta’s two big North American competitors, United Airlines and American Airlines, reported their September cargo traffic up 15.7% and 9.8%, respectively.

These gains came despite a strong U.S. dollar that continues to constrain outbound U.S. air freight. U.S. Census Bureau data cited by IATA found that “16 of the top-20 air cargo markets for the US saw air export volumes from the US decline in annual terms in the first seven months of 2016.”