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Illustration: Annelise Capossela/Axios

Passenger airlines devastated by the decline in air travel during the pandemic are making up some of their lost revenue by strapping cargo into passenger seats and overhead bins of planes that would otherwise be grounded.

The big picture: It could be several years before passenger air traffic returns to normal, but the global demand for medical supplies, along with disruptions in manufacturing supply chains and increased e-commerce, means airlines have a chance, at least temporarily, to offset some of those losses by transporting more freight.

What's happening: Since the pandemic began, some 150 airlines have been operating cargo-only "ghost flights," using passenger jets to transport freight, according to Logistics Management magazine.

  • Icelandair Group, for example, in a deal with logistics provider DB Schenker, removed the passenger seats from three B-767 aircraft to transport medical equipment from China to Europe and the U.S., even slapping Schenker's name on the side of its planes.
  • Emirates SkyCargo began loading cargo in the overhead bins and seats of its B777-300ER passenger aircraft in early May in response to growing customer demand.
  • Other airlines, including KLM, SWISS, Qantas, Air Canada and Cathay Pacific, have also modified some passenger aircraft to transport cargo.
  • Lufthansa even has a name for the converted planes: "preighters," per Logistics Management.
“The cargo business is keeping aircraft, which would otherwise be parked, in the air and given us all more hope ... that we will come out of this.”
— Dominic Kennedy, Virgin Atlantic’s head of cargo operations, told Logistics Management

Zoom in: United Airlines said cargo revenue was a bright spot in an otherwise dismal second quarter.

  • Total revenue plunged 87% in April, May and June, but cargo revenue was up 36% as United flew 3,800 international cargo-only flights during the period.
  • "I mean, who would have ever thought we could do something like that?" CEO Scott Kirby said on an investor call, praising employees' resiliency.

Background: Passenger airlines have always carried commercial cargo — along with luggage and occasional pets — inside the belly holds of their planes. But when passenger traffic collapsed in early March, that airfreight capacity disappeared.

  • Yet as the virus was spreading, demand soared for personal protective equipment like masks, gloves and gowns, most of which is made in China.
  • Travel restrictions also snarled international shipping, stranding cargo containers in ports worldwide.
  • And as people hunkered down, they did more online shopping, boosting demand for fast goods delivery.
  • "What COVID-19 caused was a huge backlog of shipments because the world stood still for awhile," Aditi Mehta, whose company, PROS, provides revenue management tools for airlines, tells Axios.

For the record: The Federal Aviation Administration in April approved the use of overhead bins, storage closets and under-seat areas in the passenger portion of aircraft for lightweight pieces on cargo-only flights.

  • In May it expanded the rule to allow airlines to place cargo — with restrictions — in passenger seats when no passengers are on board.

What to watch: The cargo business is notoriously erratic — even more so now — and the head of the International Air Transport Association warned in a statement this week of continued turbulence ahead.

  • The rush to get personal protective equipment (PPE) has subsided and the economic recovery remains slow.
  • “Cargo is, by far, healthier than the passenger markets but doing business remains exceptionally challenging," said Alexandre de Juniac, IATA's Director General and CEO.

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Oct 5, 2020 - Podcasts

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U.S. airlines have begun furloughing or laying off tens of thousands of employees, including pilots, after Congress failed to pass a new bailout bill that is supported by members of both parties and the White House.

Axios Re:Cap digs into the current state of play and why it could be very tough for airlines to "unscramble the egg," with Capt. Joe DePete, president of the Air Line Pilots Association.

Scoop: Gina Haspel threatened to resign over plan to install Kash Patel as CIA deputy

CIA Director Gina Haspel. Photo: Win McNamee/Getty Images

CIA Director Gina Haspel threatened to resign in early December after President Trump cooked up a hasty plan to install loyalist Kash Patel, a former aide to Rep. Devin Nunes (R-Calif.), as her deputy, according to three senior administration officials with direct knowledge of the matter.

Why it matters: The revelation stunned national security officials and almost blew up the leadership of the world's most powerful spy agency. Only a series of coincidences — and last minute interventions from Vice President Mike Pence and White House counsel Pat Cipollone — stopped it.

Updated 5 hours ago - Politics & Policy

Coronavirus dashboard

Illustration: Sarah Grillo/Axios

  1. Health: Coronavirus deaths reach 4,000 per day as hospitals remain in crisis mode — CDC warns highly transmissible coronavirus variant could become dominant in U.S. in March.
  2. Politics: Biden says, "We will manage the hell out of" vaccine distribution — Biden taps ex-FDA chief to lead Operation Warp Speed amid rollout of COVID plan — Widow of GOP congressman-elect who died of COVID-19 will run to fill his seat.
  3. Vaccine: Battling Black mistrust of the vaccines"Pharmacy deserts" could become vaccine deserts — Instacart to give $25 to shoppers who get vaccine.
  4. Economy: Unemployment filings explode againFed chair: No interest rate hike coming any time soon —  Inflation rose more than expected in December.
  5. World: WHO team arrives in China to investigate pandemic origins.