Of all the industries impacted by the Covid-19 pandemic, airlines have been among the hardest hit. A key development during recent months – and one which cargo experts believe is here to stay – has been the re-purposing of passenger aircraft into dedicated freight roles.

Since the start of the pandemic, the cargo charter business has seen a marked increase in demand. This has opened up opportunities for airlines whose main business lines have dried up amid a sharp decline in passenger numbers, with airlines increasingly looking to replace passengers with cargo wherever possible. In a bit to partially offset lost revenues, any available space where freight can be stored is utilised: be it seats, overhead stowage compartments or closets.

Already, a number of international airlines have announced their plans to convert passenger aircraft into cargo planes (known as P2C: passenger-to-cargo) in order to increase their overall cargo capacity to meet this demand.

What are cargo charter services?

Broadly speaking, cargo charter services offer large cargo aircraft available for hire on an ad-hoc basis.

There are, however, a range of a business models operating within the market. These include traditional charter operators, which directly offer charter services, and charter brokers, which hire whole charters or shared cargo capacities from charter operators and airlines.

Thera are a number of players in the charter market in Singapore. To better understand the cargo charter business, we spoke to Mr. Anton Lomakin, the head of Singapore-based Chapman Freeborn Airchartering about major changes occurring in the industry.

Mr. Lomakin expects that the use of so-called ‘preighter’ aircraft (passenger jets being used as freighters) will be of continued importance for the industry, particularly owing to the spike in cargo rates resulting from the capacity crunch felt in March and April. That said, the process of converting aircraft is not quick and is strictly regulated, with not all types of cargo being able to be loaded in the cabin. Owing to flight safety concerns, explained Mr Lomakin, restrictions exist surrounding the size and contents of what can be carried on seats. Nevertheless, when compared to the lengthy time requirements of P2C conversions, preighters provide a quick and effective interim solution in the Southeast Asia market.

Usually, the summer season is not a peak period of demand for cargo charters, with prices typically falling. This year, however, the overall number of flights decreased so drastically that even this lower level of demand could not be adequately serviced, thereby increasing prices.

Nevertheless, with more cargo aircraft now available and prices almost back to normal, cargo aircraft once again represents the more economical solution.