Last year, leading up to Christmas was a time of plenty like no other in the history of air freight. Cargo prices were through the roof, if you didn’t have a contract forwarders were reporting 7-10 day waiting times to ship goods that just weeks before could have been carried in a matter of hours. And it lasted most of the last 4 months of the year.
Things have eased, but growing e-commerce has tightened the availability of freighters – block contracts are now being negotiated on a level never previously seen as companies want to ensure they get their shipments flown out.
Despite all this you might be surprised to find that the amount of air cargo carried by freighters was just 35% of the total in 2016-17, and is expected to drop even further to 32-33% in 2017-2021 – the reason is newer – and more – passenger aircraft with belly freight capabilities.
However there still aren’t enough freighters to go around. Even if you can find one airlines are reporting 9 months to a year in waiting times to bring a second-hand aircraft out of storage and re-certify it, because servicing capacity is running at full tilt and is booked up months in advance.
Lufthansa is looking to replace its MD-11F’s because they’re not efficient enough, but the back log on orders for any possible alternative is too long. Medium haul freight is less of a concern, but inter-continental freighters are desperately hard to find in a condition that’s considered acceptable, and economical enough to sustain.
Even if you do find them, as Atlas Air recently did with another 744F, ex-EVA Air, getting it serviced and operational is taking an age.
Even new capacity is restricted, because of what the cargo companies refer to as integrators – (UPS and FedEx for example), who use every type of aircraft from feeder to medium haul to intercontinental. They have 78% of all freighters in the pipeline on order, leaving little room for smaller intercontinetal orders.
Even more worrying is that freighter deliveries – based on orders from years back, peaked during 2015-17 and little new is coming onto the market because nobody was ordering it during the down-turn years.
Now, while there is every sign the end of 2018 will be as good as 2017, cargo operators are still nervous about over-expanding. One major economic crisis or international incident, the growth of a tariff and trade war between the US and China for example, could tip it all into sharp reverse. Nobody wants to be left with expensive freighters, with nowhere to go.