Was your package delivered on time? You have this supply chain workaround to thank

If your seafood is fresher and your online order arrives on time, thank the pandemic: supply chain disruptions actually make it possible to deliver some things faster.

Seafood manufacturers, retailers and distributors have increasingly turned to air cargo planes to transport products – a more expensive, but faster and more reliable alternative to long-haul trucks, trains and ocean-going vessels bogged down by pandemic-related issues.

“When the going gets tough, supply chains turn to air freight,” said Michael Zimmerman, supply chain expert and partner at management consultancy Kearney.

The pivot came in response to a surge in online orders from Americans confined to their homes due to COVID-19, as well as traditional supply chain turmoil, spurred by factory closures in the early months of the pandemic and labor shortages, among other issues. Supply chain issues are one of the reasons prices for many commodities soared, with inflation hitting a new 40-year high on Tuesday.

The volume of cargo shipped by air in 2021 is up nearly 19% from a year earlier, according to the International Air Transport Assn., a trade group for the world’s airlines. That year, 2021, saw the highest air cargo volume since 2010, the group said.

Demand has grown so rapidly that airlines, shipping lines and aircraft manufacturers have begun to invest heavily in new air cargo planes or in converting existing passenger planes to carry only cargo .

Facilities where passenger planes are transformed into cargo planes – by removing passenger seats, reinforcing the floor and adding larger doors – are growing in China, Canada, Costa Rica and England.

Airbus, the European aircraft manufacturer, estimates that the world will need around 2,440 more freighters, of which 880 would be new builds and 1,560 would be conversions, over the next 20 years.

Air cargo planes have limitations. Air freighters cannot carry flammable goods, and because air freight is expensive — up to 20 times more expensive — manufacturers and retailers try to limit air freight to high-value, low-weight items such as microprocessors for cell phones, pharmaceuticals, cut flowers, jewelry, live animals and expensive clothing.

One of the main reasons for the increase in demand for air freight has been the surge in online shopping caused by the pandemic. Target reported sales growth of 12.7% to $106 billion in fiscal 2021, from $94 billion in 2020. The retail giant attributed about half of its growth to online sales. In 2021, Amazon’s net sales increased 22% to $469.8 billion from $386.1 billion in 2020.

To meet increased demand, Amazon bought four planes from Canadian airline WestJet and seven planes from Delta Air Lines last year to bring its airline fleet to more than 80 planes, according to Amazon.

“Our goal is to continue to deliver customers across the United States the way they expect from Amazon,” said Sara Rhoads, vice president of Amazon Global Air, in a statement. The retail giant declined to comment further on the matter.

When most air travelers stopped flying at the start of the pandemic, airlines eliminated dozens of passenger flights, which meant that these planes could no longer carry cargo in the belly of planes. A few airlines have packed empty passenger planes with cargo in the cabin, but others, like Alaska Airlines, have started investing in cargo planes.

Airfreight has also increased in response to traffic jams among logistics companies, such as long-haul shippers who have faced COVID-19 outbreaks among workers. The disruptions have made traditional logistics less reliable and more expensive, making the cost of air travel more competitive – in relative terms, according to the International Air Transport Assn. Instead of being 10 to 20 times more expensive, air travel is now around six times more expensive than traditional alternatives, the trade group reported.

“Demand for air cargo capacity is high, and it’s going to stay high,” Zimmerman said.

Alaska Airlines, which has three planes dedicated to air cargo, last month announced plans to convert two of its passenger Boeing 737-800s to cargo planes. The additional planes will help transport fresh produce, medical supplies, building materials, machinery parts, appliances, furniture, e-commerce deliveries, mail and fresh seafood from the EU’s fisheries. Alaska, depending on the airline.

“Fresh seafood commands a premium price for processors compared to frozen products, so as we bring more freighters to market, we will have more capacity to transport fresh seafood out of Alaska than we can’t today,” Alaska spokeswoman Maria Cid said.

Danish logistics giant AP Moller-Maersk bought an air freight company last year to bolster its fleet of ships, trains and trucks, and France’s CMA CGM has set up a new air freight division.

Boeing said it had booked a record 84 orders for cargo planes in 2021, surpassing its previous record of 83 in 2019. This is on top of more than 100 orders and commitments made last year to convert passenger jets into aircraft. cargo.

So far this year, Boeing has announced orders from Qatar Airways for 34 new 777X freighters with an option for 16 more and an order for four 777s from China Airlines. Dublin-based ASL Aviation Holdings has ordered up to 20 converted freighters.

“The cargo was an afterthought,” Boeing spokesman Brian Hermesmeyer said. “They’re thinking freight now. He gets a seat at the table.”

Boeing operates 11 facilities to convert passenger jets to freighters and has announced plans to add nine new conversion lines.

The process of converting a passenger aircraft to a cargo aircraft can take several months, depending on the aircraft and the demand at the conversion facilities.

Conversions typically involve older passenger planes that would otherwise be parked at a remote airport and stripped down for parts or sold to a foreign airline.

“When we have planes at this stage of life, they either go to the desert, or go to another airline, or become freighters,” Hermesmeyer said. “That way we get 10 to 15 more years out of it.”

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