Airlines turn to shipping cargo to offset coronavirus losses
Lufthansa and Virgin Atlantic are among the many airlines opting to transition to hauling cargo — sometimes in empty passenger cabins — after the coronavirus pandemic gutted demand, the New York Times reports.
Why it matters: It's another example of how the pandemic is changing the economics of the airline industry, which has been transporting medical equipment around the word to battle the coronavirus — as well as more traditional items like mail, seafood and smartphones.
The state of play: Typically, half of all air freight is transported through companies like UPS, FedEx and DHL and the other half is in the baggage holds of passenger planes.
- Virgin had never flown a cargo-only flight before the pandemic and is now operating 90 such flights a week.
- American Airlines is flying nearly 140 cargo flights a week.
Yes, but: While the practice offers some momentary relief for airlines, the tenuous state of the world economy could bring a drop in demand for goods, calling freight rates to fall as well.