Top cargo carriers solidify foothold with freighter additions

The logistics industry’s dependence on freighter aircraft as a primary source of transport has driven fleet growth among many of the top cargo carriers in the past two years, with the top five carriers accounting for eighteen of the thirty-one freighters brought into service in 2022. The table below shows the net freighter fleet changes at the top twenty-five cargo carriers or carrier groups by traffic volume. For the purposes of this analysis, the airline group rankings are based on the traffic figures from 2020 as IATA’s full 2021 data is not yet available. The market itself began to level off as pandemic restrictions were eased and passenger airlines began to resume normal flight operations, enabling shippers to access belly freight capacity on a limited basis. However, global shipping in the Asia-Pacific region was severely affected by the resurgence of COVID-19 in China, as key trade ports in the country came under lockdown. Air cargo traffic dropped 9.7% year over year in 2020, according to IATA. Although freight volumes have steadily declined the past couple of years, carriers have been able to offset the reduced volume by securing loads through e-commerce and express shipping. FedEx stays on top FedEx Express witnessed the highest YoY increase in traffic among the top five carriers at 12% and has remained the top-ranked carrier after increasing its freight tonne kilometers (FTKs) by 2.2 billion in 2020. The Memphis-based carrier also led all twenty-five carriers in fleet growth for the past two years, with the addition of twelve 767-300Fs, four 777Fs, and four ATR-72 600Fs. UPS, which was a close second to FedEx in YoY FTK growth for 2020, added four more freighters to its fleet in 2022. The No. 4 and No. 5 remained with Atlas Air and Emirates, respectively, for the second year in a row, although both saw a reduction in FTKs for 2020. Atlas Air Worldwide Holdings, which recently announced it had been purchased for $2.9 billion by an investment group led by Apollo Global Management, received the first of four new 747-8Fs in June 2022. These 747 freighters will be the last to be built by Boeing and the carrier expects to add one of the four 777Fs it has ordered by yearend. Atlas also exercised purchase options on eight 747-400Fs previously on lease. Gulf carriers set to grow further Emirates, now at No. 5, had been the reigning top international cargo carrier for five years until it was supplanted by Qatar in 2018. Although the Dubai-based carrier decided to return two 777Fs (35606 and 35607) off lease back to its lessor in 2019, and has since returned two more (35612 and 35613), recent actions indicate it plans to grow its freighter fleet again. The airline expects to convert at least ten 777-300ERs into freighters with Israel Aerospace Industries (IAI) using its own passenger aircraft as feedstock. Meanwhile, another U.A.E.-based operator, Etihad Airways, ranked just outside the top twenty-five in terms of 2020 FTKs, became the fifth customer in 2022 to commit with Airbus when it announced a letter of intent in February for seven A350Fs. The carrier has since confirmed that it has firmed up that deal, although it is currently unclear whether it intends to replace its five 777F. After selling its oldest 777F (39682) to FedEx in January 2021, Etihad’s freighter fleet now has an average age of six and a half years, making it one of the youngest in the industry. While Qatar remains the top international cargo carrier for a second year in a row, it dropped down to No. 3 in the 2020 FTK rankings from No. 2, with UPS surpassing the Doha-based carrier even though Qatar increased its FTKs by 5%. Qatar took delivery of two 777Fs in the second quarter of 2021 but will undergo a wave of freighter additions later this decade: the carrier became Boeing’s launch customer for the new 777-8F in early 2022 by placing a firm order for thirty-four with an option for sixteen more. Silk Way expands with both Airbus and Boeing Silk Way West just missed the top 25 by 91 million FTKs in 2020, but the Azerbaijan-based carrier went against the grain of being an all Boeing operator when it ordered two A350Fs in July 2022 with an option for two more. That isn’t the only growth Silk Way will see; the carrier diversified its 747 freighter portfolio in 2021 when it added five new 777Fs to its Boeing order backlog, making the A350Fs and 777Fs the first twin-engine widebody freighters for the airline as it transitions from being an all quad-engine widebody carrier. Silk Way recently added two 747-400Fs (30804 and 32571, both ex-Cathay Pacific) leased to Sky Gates Airlines back to its fleet after the Russian carrier’s operations were hindered by sanctions imposed on the country. Conflict and carriers The conflict between Russia and the Ukraine is a detriment to Russian carriers as sanctions have severed agreements between lessors and insurance providers, leading to aircraft being repossessed. The most recent asset retrieval took place in March, when Singapore-headquartered BOC Aviation filed court documents in New York for unit 60118 on lease to AirBridgeCargo (ABC). The ABC fleet consisted of seventeen 747Fs and one 777F prior to being grounded in March 2022 along with seventeen other Boeing freighters in Russia, after the Bermuda Civil Aviation Authority revoked the carrier’s registrations and certificates of airworthiness. The FTK global distribution which decreased by 2%, reflecting the war in Ukraine, rising inflation and an industry recalibrating after the COVID-19 pandemic. However, fleet transactions for factory-built and conversion freighters remain strong, with both Airbus and Boeing making upward adjustments to their commercial forecasts for freighter aircraft due to strong demand for air cargo. This feature was originally published in the August 2022 issue of Cargo Facts. Cargo Facts Symposium, taking place LIVE Oct. 19-21 at the InterContinental San Diego, is the essential event for stakeholders in the air cargo industry. Learn more and register today .

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