These are all excellent points. I have also found that people have already purchased important upgrades during lockdown. People renewed their computers, bought new TVs, etc. These are upgrades that someone normally does once every 5-10 years.
As a pilot for a major Express, Courier, and Logistics company, I can say without any doubt that I (personally) would never consider moving to passenger carrier. Because even if there is a current downturn, this is nothing compared to the massive downturns passenger carriers face regularly. Where I work, "furlough" is a term hardly ever mentioned and not once faced yet. It is important to note that most ULDs (were cargo is placed to easily load on an aicraft) are built to fit Boeing single aisle aircraft from the 707, 727, 737 and 757 which all have the exact same fuselage crossection and the 767 uses two of these side by side (offset 90°). So Airbus doesn't automatically have a leg up due to wider single aisle aircraft. They'll still use the same ULDs.
@@Somebody0795 Plus the time lost in unloading every ULD and reloading the same stuff onto another ULD. Part of the usefulness of ULDs is the ease of transferring them from one aircraft onto another when in transit.
My cousins partner is a long haul BA captain, and said it was truly bizarre to be flying passenger aircraft full of cargo during the “event”. He joked that he would entertain himself by continuing to make announcements to the cargo, including mid flight announcements. He was grateful to still be flying as many of his colleagues had been furloughed, but his usual routes (to the far east) were uncomfortable, as they would either fly with a full relief crew for a rapid turnaround without leaving the aircraft, or would be transported in quarantine to an onsite airport hotel and would have their meals dropped off at the door and no ability to leave their room until it was time to return to the aircraft. “This is your captain speaking. I would like to extend a warm welcome to our boxes of face masks travelling in Club World, and also to those Rapid Antigen Testing Kits travelling with our OneWorld partners.”
You'd be surprised how many clothes got shipped by air, even before the pandemic.The fashion industrie wants us to change our clothes four times a year. E.g. in summer they decide on the fall collections. this stuff gets made mostly in low labour cost countries, like China, Vietnam or Bangladesh. From there it has to go to the markets in Europe or North America. Bringing the clothes by ship takes time (up to six to eight weeks from e.g. China or Vietnam to Europe), by then the winter season would almost be over again. So the textiles get shipped by air. I have been working in the aviation industrie for almost thirty years now, first as a loader in air cargo, then in passenger handling and since about 25 years in aircraft maintenance,often for cargo airlines. In my opinion this fashion stuff is a huge waste of resources.
They decide a lot earlier than 3 months. Most major retailers are planning their sales 6-9 months ahead of time. Now shipping the items is done Just In Time.
Heartening to see a channel that is willing to explain the hidden intricacies of the industry unlike many that just offer the easy clickbait of crashes and near misses. This shows true enthusiasm for a subject.
1. Cargo volume is declining, but to pre Covid levels, so back to normal. 2. FDX and UPS hired a lot during Covid - FDX hired a lot more pilots 3. UPS has historically been around 3000 pilots, so they offered early retirement settlements to about 190ish captains that qualified. Most were already going to retire within 1 week to 1yr of this voluntary settlement. 4. PSA saw this early UPS retirement as a way to maybe get some pilots. So they offered these retiring UPS captains a hefty sign on bonus to fly for them for about 2-3 yrs with some strings attached (doubt anyone will take it). It’s purely PSA trying to fill pilot seats and not UPS endorsed in any way. This PSA program is only for the VTP Captains retiring from UPS, it’s not for any other UPS pilots. 5. FedEx on the other hand, is not a unified pilot group like UPS. They have union members that want to fatten their retirement checks, members that want high wages, members that want to keep the pension for new hires. Their pilot union is shooting in every direction for their own personal gains. So when FedEx pilot and union member, Pat DiMento saw the PSA deal for retired UPS captains he worked the deal with PSA for any FedEx pilot to go to PSA. He’s getting close to retirement and wants the new contract to benefit him in retirement so the best way for his personal gain is to trim any extra younger pilots off the seniority list - fewer opposing votes. Put this PSA threat out there and try convincing younger pilots to jump ship to American, United, or Delta. It’s a pure insult to FedEx pilots to go to a regional such as PSA, because they are more qualified than who main line American, United, and delta are currently hiring - non of them would go to PSA and try flowing to American, when they could just go direct to American. Really just comes down to contract negotiations And trying to achieve personal gains. 6. FedEx is in the middle of their contract negotiations now, UPS will be next summer. Historically before our contract negotiations the volume slows down to try making the pilot group sweat. Also historically the cargo slows down before the passenger carriers slow down before a recession. It’s been pretty clear UPS has been proactive in posturing for a major recession for a while and likely why they didn’t go as crazy hiring tons of pilots during Covid like FedEx did.
Great research as always Petter. I worked in global logistics and freight forwarding before deciding to go to flight school, so this video really encompassed what my life has been for the last 3 years. We were charging huge prices for air cargo, and having record sales despite all the chaos in the industry during covid.
I work in the trucking industry in the continental US. We're also seeing a major drop in freight. A few small to medium sized 3pl trucking companies have actually gone bankrupt (most well known: Yellow) due to decreased freight. It seems the entire logistics industry is in a rough spot.
One of my friend’s husband is a cargo pilot for Atlas Air, flying 747-400F and the 747-8F between southern California and China with a stop in Anchorage. Even though he is firmly in middle age, this is a fairly new career for him after flying FA/18s for the US Navy before retiring as a Lt Colonel. I look forward to asking him how the cargo business looks like from where he sits. Also fun fact, the last commercial 747-8F off the assembly line was delivered to Atlas and he gets to fly it.
There is RUclips pilot on a channel called 74 GEAR that I think flies an Atlas 747. He is very popular, doing slightly different material to Mentour although I think they collaborate sometimes.
I left Atlas 9 months ago for American Airlines. WAY better pay and I get far more days off and an easier schedule. So glad I made the move. I''m also a former fighter pilot. I miss the Atlas pilots though, great group of people and outstanding pilots.
An exceptional summation of a game that has more cycles and challenges than fleas on a dog. Volumetric considerations have been part of the air express industry for decades. A great example is the "what the ..." moment when DHL bought Airborne Express back in the day and found the hard way that DC9's could only carry envelopes and small parcels. You covered a massive amount of ground in an entertaining, but succinct and perceptive manner, which serves as a great reminder to insiders, as well as a brilliant explainer to those who just have an interest. Thank you!
Amazon has now supplanted Fedex and UPS as the largest shipper. They are also starting to acquire their own aircraft. Overcapacity plus a rising competitor is a dangerous combination...
Amazon might be acquiring new planes but at the moment still doesn’t have an operating certificate and is utilizing other Companies to fly their jets (ATI, Atlas, ABX,..) This means that at the moment they can only transport Amazon cargo onboard and aren’t allowed to sell positive space (holding out). All that being said, it wouldn’t surprise me if they will eventually get their own Operating Certificate approved by the FAA and start their own cargo airline.
Frank, not every package that is delivered by these companies travels on aircraft many travel via ground transportation like trailers. Also Amazon is delivering their own freight, packages they've warehoused from the beginning. FedEx, UPS are couriers delivering others freight, packages. Ones they pick up from the shipper and deliver to the recipient, a bit different then Amazon. If you are really sophisticated and review the information this is just a shift from brick and mortar to a increase in online ordering. Anyways FedEx stock is up significantly and UPS stock isn't down that much. Also most Amazon freight is going to be traveling via ground transportation as things get more efficient and warehousing is done more regionally. Just sayin'
Hi Petter, I think that the introduction of narrow bodies on long haul routes will definitely lead to a reduction in cargo capacity, meaning there will be a need for dedicated freighters. Keep up the good work.
It’s worth adding that the new passenger aircraft like the B787 and A350 have incredible cargo capacity in addition to their passenger loads. I flew the B767 pax and freight configurations, in the pax config, we would add 10,000-15,000 lbs of freight, in the B787, we regularly add 40,000-50,000 lbs of freight. What’s truly amazing is it’s for almost the same fuel burn as the B767.
Out of curiosity, are you comparing a 767-300 varient to a 787-9 varient? Back when I used to dispatch we only had 767-300s and 787-8s series' and generally the pax and freight loads were identical with maybe a maximum 2 or 3 tonne discrepancy which was not worth writting to home about.
As a Cargo pilot during 2020, I can attest to the insane level of flying. It was NAT crossing, followed by minimum rest, followed by crossing, then min rest and on. Yes, the passenger birds are carrying lots of cargo again, but as long as countries keep trying to invade each other the cargo business will do just fine.
I love your channel and have watched for well over a year but as somebody not in the airline industry I rarely comment. But as a FedEx employee I have to say your explanation of the global air freight situation over the last few years too 100% bang on. And I will be sharing this video with as many people as I can. Love this thank you.
Easy to see the weight versus volume issue with e-commerce generated airfreight. Look at all the times you order something online and it arrives in an enormous, comparatively light, box and the actual item you ordered takes up an eighth of the space inside the box!!!
Outstanding overall summary, obviously well researched view of the 'state' of the global air cargo industry to late 2023. Mentour always delivers 1st rate aviation videos!
As a truck driver who hauls cargo every day. I wouldn't be happy if my company wanted me to switch to driving a passenger bus. I feel for these cargo pilots. For all of us moving freight land, sea, and air it has been a roller coaster the last few years.
My country's minister actually suggested that taxi drivers switch to driving buses instead when they were hit hard during the pandemic, but driving the 2 requires different licenses
In the US there was a trucking shortage and truckers pay extremely well, now there's a glut and you use a freight auction to contract a load at fraction of what it was. I'm assuming that this is also biting into the air freight business at least in the US.
That period saw the largest transfer of wealth from the small business and working class to the billionaire class in human history. Small businesses were classed as non essential whilst the large corporations were allowed to continue trading. Huge numbers of those small businesses went bankrupt.
Alibaba which is B to B is not doing well at the moment with huge layoffs off staff. Seems that aside from social media goods people are not buying as much stuff as they used to.
Proud Western Global employee checking in here. I’m pleased to report we are out of Chapter 11, as of three days ago, very much sooner than anyone expected.
I work at a senior position for a forwarding group, and I love this video. It explains in layman's term a lot of elements. Will make sure to forward it to the teams! Brilliant research.
Peter, I should be very happy to see you and Kelsey (74 gear) discuss this. on RUclips. Because he is a freighter pilot for the moust, and you doing passengers. (Sorry for my English) The best to you and your fantastic aviation vid's! The best from Arild in Oslo Norway! 🙂
Our house was nearly hit by a military plane this summer; it passed over by about 25 feet clearance. The military admitted it was flying under 100 feet but not that it was directly headed into our house. It labored to clear, we were in it at the time and the width of the house windows where we observed this would not have even allowed us to see the plane, let alone able to see the pilots and everything about the outside of the plane. You would have heard about this disaster worldwide had they not just barely made it over. Amazing how military plays coverup. What they don’t know is that there is so much surveillance in the area with clear views that we are going to be able to out them.
I fly for PSA and we all got an email regarding the offer to the FedEx pilots offering a direct entry captain position on the CRJs with a $250k sign on bonus. 😳😳
Great video. The problem is in the C suite. Global or regional crisis in varying degrees disrupt both business and life. The unwillingness to plan for contingencies is shocking. Not one of the outcomes discussed was not telegraphed. CEO's and Boards are lazy, incompetent and focused on extraneous items which are uselessly expensive, irrelevant to their core business and offensive to the public.
" The problem is in the C suite:" ain't that a fact. They are usually enslaved to abstract concepts in vogue when they took their MBAs instead of concentrating on the business in hand.
@@nickclark4099 Also the modern investing world is different, There was in fact a time when companies were encouraged to plan and invest in the future and have long term planning. Now all Wall Street cares about is the next quarter. Stock Buybacks are one of the worst inventions in corporate history, Companies would rather buy shares back than save for a rainy day or year.
Excellent presentation of a very complex subject, your best to date. In the case of FedEx I guess a factor was Amazon’s own airfreight operation rapid expansion cutting in FedEx business.
It’s not just air cargo. Freight in general has really slowed down and the rates that carriers (road, rail and air) have been getting lower as a result
The Aviation Industry is indeed a cycling Business. The Cargo Branch of Aviation shows it especially clearly. And also the complexity of what the Air Cargo Branch contains. It´s really an own Science! Thank you very much for taking up this Topic!
Excellent video. I hope everyone appreciates the thought and work that has gone into making this as I do. It’s an extremely complicated topic and I think you nailed it. Well done 👍🏻
@@MentourNow Petter, I'd be interested to hear your take on the future of the airline industry given how worsening climate change and aircraft pollution affects the environment. Many believe that by 2030, we could be at the tipping point with the environment. Given how polluting 100 000 flights a day are, surely they can't continue. But then again, people travelling for business or pleasure, are at record highs. At some point, we need to stop all our flying around. It'd be interesting to hear what your views are on this.
@@gentleken7864 I’d be interested to see your evidence as to why we “need to stop flying around” …aviation is the “easy” target to blame climate change on - usually by people that don’t do their research on how much aviation contributes or how much progress has been made in aviation regarding this. Aviation isn’t the problem.
Back in the days of propeller driven airliners, freight was limited by weight, not volume. Early jets changed that. Seems like things have come full circle...
A web of ‘cause and effect’ brilliantly explained. The over capacity in air freight means that the demand for factory built freighter aircraft will be dramatically depressed. Of the conversions of retired passenger aircraft to freighters, those with long range, heavy lift and large interior volume will be higher in demand than 737s.
Mentour actually thinks the PSA offer is serious? Literally just a negotiating tactic to try to get a subpar contract passed. Any FedEx or UPS pilot is able to get hired at mainline American any day and United is even starting to offer direct entry captain positions at mainline which any FedEx pilot would be able to get at any time if they want it.
Surprised he glossed over the “pay issue”, as well. High seniority FedEx captains can easily make over $500k /yr - you’d be lucky to make 1/4 of that moving into a new company and dropping all that seniority.
@@MentourNow the regionals have been making these upfront bonus offers to experienced 121 captains for more than a few months, and nowhere have i seen where PSA or any other regional specifically mentions FedEx. FedEx mgmt presented this as a giant middle finger to their pilot group. Classless but unsurprising move by airline management.
The offer is serious, the fact that someone from management (a pilot that has spent most of his airline career in management instead of the line) published the offer is the insult to the crew force.
We don't realize how much shipping issues affect each of us in our daily lives. Another facinating channel I watch is "What's Going on with Shipping" done by an equally knowledgeable industry insider. Currently there are strange, unexpected fluctuations on the high seas right now.
My guess is that the growth of regional warehousing is also cutting into the domestic air freight industry. Large shippers will truck freight to these strategically placed warehouses, that can get products out to customers in a day or two by ground rather than by overnight air.
Idk if this was just at Lufthansa.. or if the processes started that far back in general.. But when i was working at LHC back in 2016 we were responsible for smooth operations of the internal booking system. (effectively mostly 3rd level support and some QA for the devs) And even back then for LH volume was already the much more important gauge for how expensive transport would be in most cases. Only worked there for a short while since i am more of a dev and while it was interesting to work with the devs from the other side of the table by reproducing and reporting bugs etc. .. but yeah.. i also just got a better offer for a job i knew i'd love since i was basically doing it as student some time before..
EMBRAER has launched a conversion program from the first-generation 190 and 195 to the 190F and 195F freighters, capable of carrying 10,700 kg and 13,200 kg of net cargo, respectively.
I see one more reason: The disruption in the last few years meant that products in Europe and the US couldn’t be built because important components were missing that were built elsewhere in the world. With that experience, production companies started building and using local warehouses again for those components. As soon as local warehouses were in place for production, the need to fly in components just in time was removed. With that buffer in place, components can be shipped in cheaper containers.
@@bobwilson758 As I understand it, this is a reference to popularity of Just-in-time (JIT) manufacturing for the past couple of decades. Instead of keeping a sizeable pre-production warehouses (which costs $) to stockpile a buffer of input resources (parts, supplies, materials, etc.), they instead relied on an efficient transportation system to just buy/ship them right before they were needed, rather than storing things themselves. But the supply shocks and delays caused by COVID, the Russo-Ukrainian war, the Suez blockage, etc. caused enormous hiccups resulting in factory slowdowns or even furloughs (most notably with the enormous microchip shortage the US automotive industry has faced). Many companies realized that in their attempt to save a few $, they cut out all resiliency and redundancy, and made their system very fragile and vulnerable to minor external shocks. The smart companies then built or rebuilt new upstream resiliency (which means they no longer need desperate measures such as overnighting things)
@@bobwilson758 If i understood the GerdCastan correctly, companies switched away from "Just in time" to having a buffer. For a long time it was cheaper to have just time time delivery because you avoid the cost of having to warehouse the items. This is only the case though if you can count on the delivery time being consistent. After the pandemic hit delivery times suddenly increased by a lot, and became unreliable. This means it would be cheaper to have a warehouse with a big buffer in it for your production, rather than having to shut down production. This also means it won't matter as much if the delivery takes between 1-2 months, because you just order a new delivery when you have stock for 2 months left.
Excellent video (as always!!) I have a question, with the 737-200 getting older what would be a good replacement for those 732 combi on unpaved runways? Short story, I fly on those every other week, maxed out on both passenger and cargo, but ther're getting old.
I can't think of anything that would replace those 100%, likely why they are still using them despite being thirsty. I'm jelly you get to fly on them lol I'd have to get a fly in fly out job somewhere up there to be on one of those old girls again. Calm Air had a dornier jet for a while but they don't anymore, and it's much smaller. Maybe a BAE-147/Avro RJ might work too but they are smaller and old too. Pretty sure both those are gravel strip capable due to high wing
@@juliogonzo2718 Dash-8's (or Q-series) are seen on a regular basis, they would work fine for passengers, but takes much more time when fully loaded with passengers and won't hold gargo as much. Fuel consumtion doesn't seem to be an issue, but age is. The company owns 2 of them, but one is being parked for months now.
The demand for air cargo volume over weight makes me wonder if it made sense for Airbus to offer their Beluga to commercial cargo operators as a high volume alternative.
Yeah these videos always have a deep accurate dive into the subject....thats how it appears to me as a non industry observer....if im wrong , then it is the fantastic presentation and storytelling that got me! I think im right tho! So thank you for your hard work and the enjoynent i get from this channel
Petter is so brilliant. He has a remarkable ability to break down the most complex of topics into understandable segments. While I can follow him as he goes, being the dummy that I am, I could never pass a test summarizing one of his videos, however. 😅🤣😂
I encountered the issues with lithium batteries myself recently, and boy has it changed very recently. Prior to the pandemic I had no issues selling on eBay and selling internationally. Just last month I sold a laptop that was purchased by someone in Germany. It was a complete nightmare to get that over there from the U.S., so much so that it had to go to Poland and the buyer picked it up there, and moreover I had to fully remove the battery and explicitly state that on the customs forms. I’m quite shocked by how fast things have changed. I can’t be too upset though, because the concerns are legitimate.
@@JasbirSingh-zj1fgthe fact they can go into thermal runaway. Look up "UPS Flight 6" to see the dangers these batteries pose. Petter also covered it on his main channel on his air disasters series.
An outstanding coverage of a multi faceted issue (kind of like a Pin Ball machine). One aspect that should be noted, at least FedEx has tended to bulk out before weigh out (UPS I am not familiar directly with though both had orders in for the A380F which would have been the ultimate bulk carrier and DHL/Prime may be in that same arena.). For FedEx the 777F while too short was far more economical than a 747 and it matched the MD-11F, so the routes stayed the same (there are some Asia to US flights that are premium and no stops for fuel or sorting/custom clearance per Anchorage AK). I find it odd that FedEx did not see this coming. Another aspect is Flying in the US with Single Aisle does not carry much cargo.
If airlines and other businesses would have supported freedom and catered to people who wanted to live their lives normally they would have been heroes with plenty of business.
The trucking and railroad industries in the US have actually been following a similar pattern for cargo demand. With the post-COVID slowing of e-commerce, rates have bottomed and stayed low through all of 2023 while there is an excess of semi trucks and of shipping containers.
Working in the field this is quite a good summary. One point I would have added is the new players: MSC, CMA and Maersk all have quite aggressive expansion plans and on the routes they are already operating they have extremely competitive rates.
CMA CGM stepped new into the Field, using first Air Belgium as their Contractor. MSC is still struggling, they had at first the plan to join Lufthansa in overtaking ITA Airways, now they´re starting their own Air Cargo Company. CMA CGM has used the time of the Pandemic a little bit better than MSC in this direction, but both are not from huge importance for the Air Cargo market at the moment. In opposite to this Maersk Air Cargo, formerly known as Star Air, is well established on the market since decades. They´re far away from being new Players. The same with EVA Air and its Cargo Branch, owned by Evergreen. So this could change the Air Cargo Market in the Future, but its impact on the development at the moment seems to be not so relevant. For a short view on the statistics: CMA CGM Air Cargo: 3 A 330-300 F and 2 B 777 F. Maersk Air Cargo: 12 B 767-200 F and 10 B 767-300 F, EVA Air Cargo: 8 B 777 F, MSC Air Cargo: 3 B 777 F - but operated by Atlas Air, so not their own Aircrafts. If you compare this with the real Big Player in the Market - FedEx, UPS, DHL, Atlas Air, Qatar Airways Cargo, Cargolux, Lufthansa Cargo together with AeroLogic - that is not much.
@@NicolaW72 oh wow I had no clue the boat companies were into the air cargo too. I have seen pictures and read about the UPS Worldport, their airhub and wow that is quite the facility.
@@filanfyretracker Yes, the Boat Companies are in the Air Cargo Market, too. So they can offer quicker transport for some Cargo like Medicine and Food to their Customers, too - some like Maersk and Evergreen since a long time, others like CMA CGM and MSC very new.
Atlas Air seems to be bucking the trend. They just bought 2 new 777F’s for delivery late 2024. If volume is now the priority over weight, I wonder if an A380P2F would be on the cards….
Another thing to consider, Chinese manufacturing and Artificial intelligence predictors. It takes 2-6 weeks to ship something somewhere, but if you know a specific number of extremely likely purchases are coming, you just ship it 1-5 weeks early, and you don't need to worry about 2 day overnight air shipping
You are always great! Really eye opening information which after hearing helps to explain many other factors and situations occurring both in the past and currently! In the city I live, we have a newly constructed humongous Amazon distribution center built back in 2022 with promises for new business and employment opportunities, stands empty today with a for sale or lease being advertised. It all makes sense to what happened!!!
Thank you Mentour for this. I think the picture varies by where cargo is being shipped *to*. Europe, Asia and North America have a need for short range cargo, but below the Equator, it's different. Every cargo flight is a long haul flight. Whether it is exports of fruit or flowers, or eCommerce imports (which has an important economic niche in small island countries like NZ), everything has to travel enormous distances. The ups and downs of cargo costs, exchange rates and the global downturn are having a major limiting effect. There are *still* supply chain issues. Problems with mail by sea means a lot of mail is by air. The cost of moving, well, anything, is still high. It means the purchasing patterns of shoppers 'down under' has moved away from the US to Asia, or even UK retailers who offer free shipping. Why? Because exchange rates may be bad, but if shipping costs are low or free, it all balances out. Meanwhile, Amazon US has trebled shipping 'down under' at a time the exchange rate is poor and no doubt some of the factors you mentioned are to blame.
I don't think so. I guess vast majority of goods, especially e-commerce, comes from China and around, so that means long haul to most consuming parts like US and Europe.
Before volume was needed again for freighters would it have been feasible to unstretch longer variants during the freighter conversion or would this have been too big of a job?
We are a mid sized shipper who have been crippled by air rates in recent years. UPS Fedex and DHL are stubbornly holding prices at pandemic levels, originally claiming "peak surcharge" and now blatantly just ripping off as many SMEs as they can until everyone will either get sick of it or go bankrupt.
Been watching a lot of your videos and so much stuff makes more sense, especially why things are done in such strange ways. From safety wired windshield wipers to landing gear lock pins in the cockpit it is all for safety and redundancy. I think the landing gear lockout pins living in the cockpit is a great example and it makes sense why. Very impressive how everything is done but there is still room for improvement in some areas.
The A380 will never be a cargo plane. Airbus originally planned to build them (UPS was very interested) but they realized it would not be an efficient freighter. If it was viable they would already have been converted instead of sitting in the desert.
What do I think? I think this video contained a lot of information compacted well into a relatively short video meaning a lot of effort in the background to produce such a valuable content. Well done Mentour Now team!
Great video, it’s rare to see content creators for aviation talking about air cargo. However some of your market background are incorrect or outdated. 1) The air freight industry has already been in the pits since November 2022, where there was no black friday or christmas rush which typically happens. Market rates from Asia to Europe and the US were softened to the point of below annual average in 2019. However this holiday season paints a better outlook as capacity is completely wiped out to America and certain parts of Europe. 2) The drivers of demand and supply went in extreme polar opposites due to huge inventory overhangs in Europe and US in 1st half of 2023, coupled with companies that engaged in more aggressive carbon emission controls in their supply chain - led to less cargo on the aircrafts and more on the ULCCs 3) Relying on just fedex as one case maybe inaccurate. Pilots can always choose to fly for another airline outside of US as the pilot shortage is rampant not only there 😂
Oh and also, not all lithium battery products need to be fitted into fire bags, it depends on the IATA DGR, your typical iphones, laptops and be moved in boxes that meet the IATA DGR safety limits
One thing you didn't touch on is the loss of the nose loading 747. As far as I know the only strait in loading aircraft that are still in production is the C130J that does have a civilian certified version available and the A400M that I don't think has a civilian version. This is obviously a niche market but being from Alberta Canada I know that the oil industry ships large components that won't fit in a traditional cargo door.
It seems to me like all of the companies involved made long term plans based on current situations being the normal future. Nothing could be further from the truth because the current situation was guaranteed to change radically. The only question left was "How fast?"
And how anyone can discuss this topic without mentioning the effect of inflation on our budgets is beyond me. I guess if you are on a pilots wages you don’t notice it.
I wouldn't be surprised if this spawns some PhD's in economics. I have a double major in economics, and one would expect a "cobweb" effect - so called, because the market trying to restore equilibrium in these types of circumstances looks like a cobweb in diagrams. Petter: "The freight industry doesn't work in a vacuum.." That's a shame, as it would be entirely safe to carry lithium ion batteries:-) Excellent video thanks Petter.
moment einmal : laut unserem Luftfahrtbundesamt oder der kopie u.s. luftfahrtamt müsst ihr piloten.-/innen einen Flugstundennachweis führen (wie wir unsere lenk.-/ruhezeit & arbeitszeitnachweis mit nem'bus ) und das bei sämtlichen luftfahrzeugen sogar ballone
The business is obviously filled with opportunists rather than strategists. A five to ten years from now little of these players will still be in business, I foresee.
The Australian government briefly increased unemployment benefits dramatically, allowing people to update their clothing, footwear, and to get a some reliable technology. Sadly at the first step down from the highest rate it once again became the lowest rate of assistance in the OECD, then dropped into an extreme poverty rate again.
Just a joke, if sending tons of bubble wraps across the world became the new norm, when we can see a A380 freighter revive from the scrap to be the bubble wrap oriented giant freighter?
Can we mention how the standard edition American worker/ consumer has had stagnant wages for decades, and this was facilitated by low / zero percent interest rates which are now gone. Housing costs are through the roof, fuel is through the roof, food is through the roof , medical costs through the roof. People cannot refinance their homes anymore to pay off credit purchases. So now we are seeing the REAL ECONOMY .....Things are going to get very bumpy soon , I cannot see how people cannot see it. also- I believe US domestic passenger travel will drop off sharply next year and there will be more consolidation like Alaska and Hawaiian....
![I.N "HALLUCINATION" | [Stray Kids : SKZ-PLAYER]](http://i.ytimg.com/vi/n5B5q1Hwt_U/mqdefault.jpg)
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Thanks for the video, Petter. You've clarified what has been happening during the past few years.
These are all excellent points.
I have also found that people have already purchased important upgrades during lockdown. People renewed their computers, bought new TVs, etc. These are upgrades that someone normally does once every 5-10 years.
Good point
As a pilot for a major Express, Courier, and Logistics company, I can say without any doubt that I (personally) would never consider moving to passenger carrier. Because even if there is a current downturn, this is nothing compared to the massive downturns passenger carriers face regularly. Where I work, "furlough" is a term hardly ever mentioned and not once faced yet.
It is important to note that most ULDs (were cargo is placed to easily load on an aicraft) are built to fit Boeing single aisle aircraft from the 707, 727, 737 and 757 which all have the exact same fuselage crossection and the 767 uses two of these side by side (offset 90°). So Airbus doesn't automatically have a leg up due to wider single aisle aircraft. They'll still use the same ULDs.
The 350Fs are having a new ULD design yet again.. imagine the airlines that have to pay for added equipment 😂
@@Somebody0795 Plus the time lost in unloading every ULD and reloading the same stuff onto another ULD. Part of the usefulness of ULDs is the ease of transferring them from one aircraft onto another when in transit.
@@frank_av8tor what size are palletized loads? Are they a standard 42"x48" skid or do they use something different?
@juliogonzo2718 There many different ULDs. The "standard" single aisle upper deck ULD (AAY) is 88" by 125" and 82" tall.
The fleets servicing DHL have included airbus jets yet most are Boeing aircraft....
My cousins partner is a long haul BA captain, and said it was truly bizarre to be flying passenger aircraft full of cargo during the “event”. He joked that he would entertain himself by continuing to make announcements to the cargo, including mid flight announcements. He was grateful to still be flying as many of his colleagues had been furloughed, but his usual routes (to the far east) were uncomfortable, as they would either fly with a full relief crew for a rapid turnaround without leaving the aircraft, or would be transported in quarantine to an onsite airport hotel and would have their meals dropped off at the door and no ability to leave their room until it was time to return to the aircraft.
“This is your captain speaking. I would like to extend a warm welcome to our boxes of face masks travelling in Club World, and also to those Rapid Antigen Testing Kits travelling with our OneWorld partners.”
You'd be surprised how many clothes got shipped by air, even before the pandemic.The fashion industrie wants us to change our clothes four times a year. E.g. in summer they decide on the fall collections. this stuff gets made mostly in low labour cost countries, like China, Vietnam or Bangladesh. From there it has to go to the markets in Europe or North America. Bringing the clothes by ship takes time (up to six to eight weeks from e.g. China or Vietnam to Europe), by then the winter season would almost be over again. So the textiles get shipped by air.
I have been working in the aviation industrie for almost thirty years now, first as a loader in air cargo, then in passenger handling and since about 25 years in aircraft maintenance,often for cargo airlines. In my opinion this fashion stuff is a huge waste of resources.
Thank you! I was thinking more about jeans and things 😂
I know for fedex we have a shit load of shein like half a 777 filled with it.
They decide a lot earlier than 3 months. Most major retailers are planning their sales 6-9 months ahead of time. Now shipping the items is done Just In Time.
Heartening to see a channel that is willing to explain the hidden intricacies of the industry unlike many that just offer the easy clickbait of crashes and near misses. This shows true enthusiasm for a subject.
1. Cargo volume is declining, but to pre Covid levels, so back to normal.
2. FDX and UPS hired a lot during Covid - FDX hired a lot more pilots
3. UPS has historically been around 3000 pilots, so they offered early retirement settlements to about 190ish captains that qualified. Most were already going to retire within 1 week to 1yr of this voluntary settlement.
4. PSA saw this early UPS retirement as a way to maybe get some pilots. So they offered these retiring UPS captains a hefty sign on bonus to fly for them for about 2-3 yrs with some strings attached (doubt anyone will take it). It’s purely PSA trying to fill pilot seats and not UPS endorsed in any way. This PSA program is only for the VTP Captains retiring from UPS, it’s not for any other UPS pilots.
5. FedEx on the other hand, is not a unified pilot group like UPS. They have union members that want to fatten their retirement checks, members that want high wages, members that want to keep the pension for new hires. Their pilot union is shooting in every direction for their own personal gains. So when FedEx pilot and union member, Pat DiMento saw the PSA deal for retired UPS captains he worked the deal with PSA for any FedEx pilot to go to PSA. He’s getting close to retirement and wants the new contract to benefit him in retirement so the best way for his personal gain is to trim any extra younger pilots off the seniority list - fewer opposing votes. Put this PSA threat out there and try convincing younger pilots to jump ship to American, United, or Delta. It’s a pure insult to FedEx pilots to go to a regional such as PSA, because they are more qualified than who main line American, United, and delta are currently hiring - non of them would go to PSA and try flowing to American, when they could just go direct to American. Really just comes down to contract negotiations
And trying to achieve personal gains.
6. FedEx is in the middle of their contract negotiations now, UPS will be next summer. Historically before our contract negotiations the volume slows down to try making the pilot group sweat. Also historically the cargo slows down before the passenger carriers slow down before a recession. It’s been pretty clear UPS has been proactive in posturing for a major recession for a while and likely why they didn’t go as crazy hiring tons of pilots during Covid like FedEx did.
Spoken like a true pilot.
Good synopsis
I just talked to a FedEx buddy. He was saying that they are 600 pilots overmanned due to Covid hiring and loads back to pre Covid levels.
Great research as always Petter. I worked in global logistics and freight forwarding before deciding to go to flight school, so this video really encompassed what my life has been for the last 3 years. We were charging huge prices for air cargo, and having record sales despite all the chaos in the industry during covid.
I work in the trucking industry in the continental US. We're also seeing a major drop in freight. A few small to medium sized 3pl trucking companies have actually gone bankrupt (most well known: Yellow) due to decreased freight.
It seems the entire logistics industry is in a rough spot.
I deliver the burgers 🍔 and fries 🍟 to a large American fast food chain with a big golden M. We're as busy as we've ever been.
@@Nickbaldeagle02people still have to eat
One of my friend’s husband is a cargo pilot for Atlas Air, flying 747-400F and the 747-8F between southern California and China with a stop in Anchorage. Even though he is firmly in middle age, this is a fairly new career for him after flying FA/18s for the US Navy before retiring as a Lt Colonel. I look forward to asking him how the cargo business looks like from where he sits. Also fun fact, the last commercial 747-8F off the assembly line was delivered to Atlas and he gets to fly it.
Atlas Air being primarily an ACMI airline is in a somewhat different category and has some insulation from the pure cargo airline woes.
I can hear your friend being asked at a cocktail party: " So, what does your husband do?". "This. And before that he did this.". "Oh...".
There is RUclips pilot on a channel called 74 GEAR that I think flies an Atlas 747. He is very popular, doing slightly different material to Mentour although I think they collaborate sometimes.
I left Atlas 9 months ago for American Airlines. WAY better pay and I get far more days off and an easier schedule. So glad I made the move. I''m also a former fighter pilot. I miss the Atlas pilots though, great group of people and outstanding pilots.
Atlas just ordered two more 777-ERF’s from Boeing this week so I’d say their diversification strategy is proving beneficial.
An exceptional summation of a game that has more cycles and challenges than fleas on a dog. Volumetric considerations have been part of the air express industry for decades. A great example is the "what the ..." moment when DHL bought Airborne Express back in the day and found the hard way that DC9's could only carry envelopes and small parcels. You covered a massive amount of ground in an entertaining, but succinct and perceptive manner, which serves as a great reminder to insiders, as well as a brilliant explainer to those who just have an interest. Thank you!
Amazon has now supplanted Fedex and UPS as the largest shipper. They are also starting to acquire their own aircraft. Overcapacity plus a rising competitor is a dangerous combination...
Amazon might be acquiring new planes but at the moment still doesn’t have an operating certificate and is utilizing other Companies to fly their jets (ATI, Atlas, ABX,..) This means that at the moment they can only transport Amazon cargo onboard and aren’t allowed to sell positive space (holding out). All that being said, it wouldn’t surprise me if they will eventually get their own Operating Certificate approved by the FAA and start their own cargo airline.
Amazon uses traditional carriers to perform 'last-mile' segment of its delivery, but in a very uneven way, creating much stress upon those orgs.
Frank, not every package that is delivered by these companies travels on aircraft many travel via ground transportation like trailers. Also Amazon is delivering their own freight, packages they've warehoused from the beginning.
FedEx, UPS are couriers delivering others freight, packages. Ones they pick up from the shipper and deliver to the recipient, a bit different then Amazon. If you are really sophisticated and review the information this is just a shift from brick and mortar to a increase in online ordering.
Anyways FedEx stock is up significantly and UPS stock isn't down that much. Also most Amazon freight is going to be traveling via ground transportation as things get more efficient and warehousing is done more regionally.
Just sayin'
Does Amazon have an international Network like Oops and Fedup???
@@robertkeyes258 To outer areas, yes. They use the US postal service. In big cities, like where I am, they have their own trucks.
Hi Petter, I think that the introduction of narrow bodies on long haul routes will definitely lead to a reduction in cargo capacity, meaning there will be a need for dedicated freighters. Keep up the good work.
It’s worth adding that the new passenger aircraft like the B787 and A350 have incredible cargo capacity in addition to their passenger loads. I flew the B767 pax and freight configurations, in the pax config, we would add 10,000-15,000 lbs of freight, in the B787, we regularly add 40,000-50,000 lbs of freight. What’s truly amazing is it’s for almost the same fuel burn as the B767.
Out of curiosity, are you comparing a 767-300 varient to a 787-9 varient? Back when I used to dispatch we only had 767-300s and 787-8s series' and generally the pax and freight loads were identical with maybe a maximum 2 or 3 tonne discrepancy which was not worth writting to home about.
-900 and -1000
Let’s not only mention that ATI and TAS are still looking for cargo pilots in 737, 747, and md80/90
The 787 is a truly amazing marvel of engineering. As is the 777X.
@@Aerogamer158l9
As a Cargo pilot during 2020, I can attest to the insane level of flying. It was NAT crossing, followed by minimum rest, followed by crossing, then min rest and on. Yes, the passenger birds are carrying lots of cargo again, but as long as countries keep trying to invade each other the cargo business will do just fine.
I love your channel and have watched for well over a year but as somebody not in the airline industry I rarely comment. But as a FedEx employee I have to say your explanation of the global air freight situation over the last few years too 100% bang on. And I will be sharing this video with as many people as I can. Love this thank you.
You work for one of the largest airlines in the world 😉 You do work in the airline industry 👍🏻
Easy to see the weight versus volume issue with e-commerce generated airfreight. Look at all the times you order something online and it arrives in an enormous, comparatively light, box and the actual item you ordered takes up an eighth of the space inside the box!!!
You are very correct, you don't need to wonder why e-commerce is taking up so much volume
Outstanding overall summary, obviously well researched view of the 'state' of the global air cargo industry to late 2023. Mentour always delivers 1st rate aviation videos!
As a truck driver who hauls cargo every day. I wouldn't be happy if my company wanted me to switch to driving a passenger bus. I feel for these cargo pilots. For all of us moving freight land, sea, and air it has been a roller coaster the last few years.
My country's minister actually suggested that taxi drivers switch to driving buses instead when they were hit hard during the pandemic, but driving the 2 requires different licenses
In the US there was a trucking shortage and truckers pay extremely well, now there's a glut and you use a freight auction to contract a load at fraction of what it was. I'm assuming that this is also biting into the air freight business at least in the US.
Petter did not mention Amazon by name, but the huge growth of Amazon during the pandemic was a big part of the change in the cargo industry.
They were growing for some time before that...
That period saw the largest transfer of wealth from the small business and working class to the billionaire class in human history. Small businesses were classed as non essential whilst the large corporations were allowed to continue trading. Huge numbers of those small businesses went bankrupt.
@@paul756uk2A crime which is still not acknowledged and for which no-one but the victims will ever pay.
How so?
Alibaba which is B to B is not doing well at the moment with huge layoffs off staff.
Seems that aside from social media goods people are not buying as much stuff as they used to.
Proud Western Global employee checking in here. I’m pleased to report we are out of Chapter 11, as of three days ago, very much sooner than anyone expected.
That’s awesome news!
Trucking companies are stressing with this shortage of loads too!
I work at a senior position for a forwarding group, and I love this video. It explains in layman's term a lot of elements. Will make sure to forward it to the teams! Brilliant research.
Do tell me, what is a forwarding group?
@@brandonpinto5290hello, I meant a freight forwarder. Rgds.
@@maxd7480 oh okay. Thank you
Peter, I should be very happy to see you and Kelsey (74 gear) discuss this. on RUclips. Because he is a freighter pilot for the moust, and you doing passengers. (Sorry for my English) The best to you and your fantastic aviation vid's! The best from Arild in Oslo Norway! 🙂
Our house was nearly hit by a military plane this summer; it passed over by about 25 feet clearance. The military admitted it was flying under 100 feet but not that it was directly headed into our house. It labored to clear, we were in it at the time and the width of the house windows where we observed this would not have even allowed us to see the plane, let alone able to see the pilots and everything about the outside of the plane. You would have heard about this disaster worldwide had they not just barely made it over. Amazing how military plays coverup. What they don’t know is that there is so much surveillance in the area with clear views that we are going to be able to out them.
I fly for PSA and we all got an email regarding the offer to the FedEx pilots offering a direct entry captain position on the CRJs with a $250k sign on bonus. 😳😳
Good video, Captain. And I'll remember those air-freight rates the next time my baggage is a little overweight.
Great video. The problem is in the C suite. Global or regional crisis in varying degrees disrupt both business and life. The unwillingness to plan for contingencies is shocking. Not one of the outcomes discussed was not telegraphed. CEO's and Boards are lazy, incompetent and focused on extraneous items which are uselessly expensive, irrelevant to their core business and offensive to the public.
" The problem is in the C suite:" ain't that a fact. They are usually enslaved to abstract concepts in vogue when they took their MBAs instead of concentrating on the business in hand.
@@nickclark4099 Also the modern investing world is different, There was in fact a time when companies were encouraged to plan and invest in the future and have long term planning. Now all Wall Street cares about is the next quarter. Stock Buybacks are one of the worst inventions in corporate history, Companies would rather buy shares back than save for a rainy day or year.
@@nickclark4099 You forgot the bonus for reaching certain business goals.
The problem is money creation. It causes the misallocation of money
I imagine planning for contingecy also can use up more resources that reduces profit/efficiency that makes the C-suite look bad too
Excellent presentation of a very complex subject, your best to date.
In the case of FedEx I guess a factor was Amazon’s own airfreight operation rapid expansion cutting in FedEx business.
It’s not just air cargo. Freight in general has really slowed down and the rates that carriers (road, rail and air) have been getting lower as a result
The Aviation Industry is indeed a cycling Business. The Cargo Branch of Aviation shows it especially clearly. And also the complexity of what the Air Cargo Branch contains. It´s really an own Science!
Thank you very much for taking up this Topic!
Excellent video. I hope everyone appreciates the thought and work that has gone into making this as I do. It’s an extremely complicated topic and I think you nailed it. Well done 👍🏻
Thank you! Glad to see that our hard work is appreciated. 💕
@@MentourNow Petter, I'd be interested to hear your take on the future of the airline industry given how worsening climate change and aircraft pollution affects the environment. Many believe that by 2030, we could be at the tipping point with the environment. Given how polluting 100 000 flights a day are, surely they can't continue. But then again, people travelling for business or pleasure, are at record highs. At some point, we need to stop all our flying around. It'd be interesting to hear what your views are on this.
@@gentleken7864 I’d be interested to see your evidence as to why we “need to stop flying around” …aviation is the “easy” target to blame climate change on - usually by people that don’t do their research on how much aviation contributes or how much progress has been made in aviation regarding this.
Aviation isn’t the problem.
@@gentleken7864I believe that the new synthetic fuels the airlines are trying to see devoloped is due to "climate change" and cost as well.
Back in the days of propeller driven airliners, freight was limited by weight, not volume. Early jets changed that. Seems like things have come full circle...
A web of ‘cause and effect’ brilliantly explained. The over capacity in air freight means that the demand for factory built freighter aircraft will be dramatically depressed. Of the conversions of retired passenger aircraft to freighters, those with long range, heavy lift and large interior volume will be higher in demand than 737s.
Mentour actually thinks the PSA offer is serious? Literally just a negotiating tactic to try to get a subpar contract passed. Any FedEx or UPS pilot is able to get hired at mainline American any day and United is even starting to offer direct entry captain positions at mainline which any FedEx pilot would be able to get at any time if they want it.
Surprised he glossed over the “pay issue”, as well. High seniority FedEx captains can easily make over $500k /yr - you’d be lucky to make 1/4 of that moving into a new company and dropping all that seniority.
@@kenk7875yep. No fedex pilots with more than 3 yrs seniority are gonna go to the regionals. It was just a tactical insult from management.
The point I was making is that a few months ago such an offer wouldn't have been made at all.
@@MentourNow the regionals have been making these upfront bonus offers to experienced 121 captains for more than a few months, and nowhere have i seen where PSA or any other regional specifically mentions FedEx. FedEx mgmt presented this as a giant middle finger to their pilot group. Classless but unsurprising move by airline management.
The offer is serious, the fact that someone from management (a pilot that has spent most of his airline career in management instead of the line) published the offer is the insult to the crew force.
We don't realize how much shipping issues affect each of us in our daily lives. Another facinating channel I watch is "What's Going on with Shipping" done by an equally knowledgeable industry insider. Currently there are strange, unexpected fluctuations on the high seas right now.
The operating costs of those 747 freighters must have been enormous
My guess is that the growth of regional warehousing is also cutting into the domestic air freight industry. Large shippers will truck freight to these strategically placed warehouses, that can get products out to customers in a day or two by ground rather than by overnight air.
Road freight is plummeting as well.
I am in it, but strictly bulk food transport.
People must eat.... 'till diesel hits $10 USD per gallon.
I"v been learning more and more about aviation thanks to you. Awesome. I feel now stressless flying ! Thx Bro.
Glad to hear it!
Idk if this was just at Lufthansa.. or if the processes started that far back in general..
But when i was working at LHC back in 2016 we were responsible for smooth operations of the internal booking system. (effectively mostly 3rd level support and some QA for the devs)
And even back then for LH volume was already the much more important gauge for how expensive transport would be in most cases.
Only worked there for a short while since i am more of a dev and while it was interesting to work with the devs from the other side of the table by reproducing and reporting bugs etc. .. but yeah.. i also just got a better offer for a job i knew i'd love since i was basically doing it as student some time before..
EMBRAER has launched a conversion program from the first-generation 190 and 195 to the 190F and 195F freighters, capable of carrying 10,700 kg and 13,200 kg of net cargo, respectively.
I see one more reason:
The disruption in the last few years meant that products in Europe and the US couldn’t be built because important components were missing that were built elsewhere in the world.
With that experience, production companies started building and using local warehouses again for those components.
As soon as local warehouses were in place for production, the need to fly in components just in time was removed. With that buffer in place, components can be shipped in cheaper containers.
Warehouses are not for production as per …. So , Huh ? Nothing has changed - nothing .
@@bobwilson758 As I understand it, this is a reference to popularity of Just-in-time (JIT) manufacturing for the past couple of decades. Instead of keeping a sizeable pre-production warehouses (which costs $) to stockpile a buffer of input resources (parts, supplies, materials, etc.), they instead relied on an efficient transportation system to just buy/ship them right before they were needed, rather than storing things themselves.
But the supply shocks and delays caused by COVID, the Russo-Ukrainian war, the Suez blockage, etc. caused enormous hiccups resulting in factory slowdowns or even furloughs (most notably with the enormous microchip shortage the US automotive industry has faced). Many companies realized that in their attempt to save a few $, they cut out all resiliency and redundancy, and made their system very fragile and vulnerable to minor external shocks. The smart companies then built or rebuilt new upstream resiliency (which means they no longer need desperate measures such as overnighting things)
@@bobwilson758 If i understood the GerdCastan correctly, companies switched away from "Just in time" to having a buffer.
For a long time it was cheaper to have just time time delivery because you avoid the cost of having to warehouse the items. This is only the case though if you can count on the delivery time being consistent.
After the pandemic hit delivery times suddenly increased by a lot, and became unreliable. This means it would be cheaper to have a warehouse with a big buffer in it for your production, rather than having to shut down production.
This also means it won't matter as much if the delivery takes between 1-2 months, because you just order a new delivery when you have stock for 2 months left.
This is the revenge of the King of Cargo the Antonov 225, it's a curse 😢😢😢
Fascinating video! You can cover just about anything in aviation. Bravo! 😊🎉
Excellent video (as always!!) I have a question, with the 737-200 getting older what would be a good replacement for those 732 combi on unpaved runways?
Short story, I fly on those every other week, maxed out on both passenger and cargo, but ther're getting old.
I can't think of anything that would replace those 100%, likely why they are still using them despite being thirsty. I'm jelly you get to fly on them lol I'd have to get a fly in fly out job somewhere up there to be on one of those old girls again. Calm Air had a dornier jet for a while but they don't anymore, and it's much smaller. Maybe a BAE-147/Avro RJ might work too but they are smaller and old too. Pretty sure both those are gravel strip capable due to high wing
@@juliogonzo2718 Dash-8's (or Q-series) are seen on a regular basis, they would work fine for passengers, but takes much more time when fully loaded with passengers and won't hold gargo as much.
Fuel consumtion doesn't seem to be an issue, but age is. The company owns 2 of them, but one is being parked for months now.
With most types of transport a little over capacity is making the price go down big time...
The demand for air cargo volume over weight makes me wonder if it made sense for Airbus to offer their Beluga to commercial cargo operators as a high volume alternative.
Yeah these videos always have a deep accurate dive into the subject....thats how it appears to me as a non industry observer....if im wrong , then it is the fantastic presentation and storytelling that got me! I think im right tho! So thank you for your hard work and the enjoynent i get from this channel
Petter is so brilliant. He has a remarkable ability to break down the most complex of topics into understandable segments. While I can follow him as he goes, being the dummy that I am, I could never pass a test summarizing one of his videos, however. 😅🤣😂
I encountered the issues with lithium batteries myself recently, and boy has it changed very recently.
Prior to the pandemic I had no issues selling on eBay and selling internationally. Just last month I sold a laptop that was purchased by someone in Germany. It was a complete nightmare to get that over there from the U.S., so much so that it had to go to Poland and the buyer picked it up there, and moreover I had to fully remove the battery and explicitly state that on the customs forms.
I’m quite shocked by how fast things have changed. I can’t be too upset though, because the concerns are legitimate.
I don't understand. What are the concerns? The laptops have always had batteries in them, right? What changed?
@@JasbirSingh-zj1fgthe fact they can go into thermal runaway.
Look up "UPS Flight 6" to see the dangers these batteries pose. Petter also covered it on his main channel on his air disasters series.
You forgot to address the greed by the airline CEOs wanting to become the next billionaire.
An outstanding coverage of a multi faceted issue (kind of like a Pin Ball machine). One aspect that should be noted, at least FedEx has tended to bulk out before weigh out (UPS I am not familiar directly with though both had orders in for the A380F which would have been the ultimate bulk carrier and DHL/Prime may be in that same arena.). For FedEx the 777F while too short was far more economical than a 747 and it matched the MD-11F, so the routes stayed the same (there are some Asia to US flights that are premium and no stops for fuel or sorting/custom clearance per Anchorage AK). I find it odd that FedEx did not see this coming. Another aspect is Flying in the US with Single Aisle does not carry much cargo.
Amazon doing more of their own shipping these days, thus the decline 😂
Makes me wonder about experimental designs that were meant to carry truck trailers or shipping containers might actually be worth it now.
If airlines and other businesses would have supported freedom and catered to people who wanted to live their lives normally they would have been heroes with plenty of business.
Our dearest Peter is becoming an economist. Great video!
I heard that the shipping industry are facing the same problems at the big shipping ports too.
Fingers crossed!
Good video, thanks. I've survived (only just) a few of these ebbs and flows 🤣
Business planning boils down to placing your bets and spinning the wheel. Where she stops, nobody knows...
Thanks for the insightful analysis. To work in this industry requires a willingness to ride the highs and the lows. That's just business.
Do you have any idea what the efficiency loss is on dead volume like the 777?
The trucking and railroad industries in the US have actually been following a similar pattern for cargo demand. With the post-COVID slowing of e-commerce, rates have bottomed and stayed low through all of 2023 while there is an excess of semi trucks and of shipping containers.
Very good overview....on the spot. Thanks a lot.
Working in the field this is quite a good summary.
One point I would have added is the new players: MSC, CMA and Maersk all have quite aggressive expansion plans and on the routes they are already operating they have extremely competitive rates.
CMA CGM stepped new into the Field, using first Air Belgium as their Contractor. MSC is still struggling, they had at first the plan to join Lufthansa in overtaking ITA Airways, now they´re starting their own Air Cargo Company. CMA CGM has used the time of the Pandemic a little bit better than MSC in this direction, but both are not from huge importance for the Air Cargo market at the moment.
In opposite to this Maersk Air Cargo, formerly known as Star Air, is well established on the market since decades. They´re far away from being new Players. The same with EVA Air and its Cargo Branch, owned by Evergreen.
So this could change the Air Cargo Market in the Future, but its impact on the development at the moment seems to be not so relevant.
For a short view on the statistics: CMA CGM Air Cargo: 3 A 330-300 F and 2 B 777 F. Maersk Air Cargo: 12 B 767-200 F and 10 B 767-300 F, EVA Air Cargo: 8 B 777 F, MSC Air Cargo: 3 B 777 F - but operated by Atlas Air, so not their own Aircrafts.
If you compare this with the real Big Player in the Market - FedEx, UPS, DHL, Atlas Air, Qatar Airways Cargo, Cargolux, Lufthansa Cargo together with AeroLogic - that is not much.
@@NicolaW72 oh wow I had no clue the boat companies were into the air cargo too. I have seen pictures and read about the UPS Worldport, their airhub and wow that is quite the facility.
@@filanfyretracker Yes, the Boat Companies are in the Air Cargo Market, too. So they can offer quicker transport for some Cargo like Medicine and Food to their Customers, too - some like Maersk and Evergreen since a long time, others like CMA CGM and MSC very new.
4:03 caused me to do a research on "treble" vs "triple".
It's common. Even, or especially (?) native speakers get it wrong
Atlas Air seems to be bucking the trend. They just bought 2 new 777F’s for delivery late 2024.
If volume is now the priority over weight, I wonder if an A380P2F would be on the cards….
Another thing to consider, Chinese manufacturing and Artificial intelligence predictors.
It takes 2-6 weeks to ship something somewhere, but if you know a specific number of extremely likely purchases are coming, you just ship it 1-5 weeks early, and you don't need to worry about 2 day overnight air shipping
Christmas bric-a-brac?
You are always great! Really eye opening information which after hearing helps to explain many other factors and situations occurring both in the past and currently! In the city I live, we have a newly constructed humongous Amazon distribution center built back in 2022 with promises for new business and employment opportunities, stands empty today with a for sale or lease being advertised. It all makes sense to what happened!!!
Thank you Mentour for this. I think the picture varies by where cargo is being shipped *to*. Europe, Asia and North America have a need for short range cargo, but below the Equator, it's different. Every cargo flight is a long haul flight.
Whether it is exports of fruit or flowers, or eCommerce imports (which has an important economic niche in small island countries like NZ), everything has to travel enormous distances. The ups and downs of cargo costs, exchange rates and the global downturn are having a major limiting effect. There are *still* supply chain issues. Problems with mail by sea means a lot of mail is by air.
The cost of moving, well, anything, is still high. It means the purchasing patterns of shoppers 'down under' has moved away from the US to Asia, or even UK retailers who offer free shipping. Why? Because exchange rates may be bad, but if shipping costs are low or free, it all balances out.
Meanwhile, Amazon US has trebled shipping 'down under' at a time the exchange rate is poor and no doubt some of the factors you mentioned are to blame.
I don't think so. I guess vast majority of goods, especially e-commerce, comes from China and around, so that means long haul to most consuming parts like US and Europe.
Petter needs to be cast in some movies ( i know not enough time ) very charismatic.
outbound freight from Asia has more than doubled (and in some cases tripled) since September. Volumes are up a lot thanks to e commerce....
Before volume was needed again for freighters would it have been feasible to unstretch longer variants during the freighter conversion or would this have been too big of a job?
Don't forget the ship that blocked the canal 😂😭
That actually caused a quite noticeable upset in rates everywhere
Indeed - the "Evergiven" if I remember right.
@@NicolaW72 Gift that keeps on "giving"?
@@alli3219 ???
We are a mid sized shipper who have been crippled by air rates in recent years. UPS Fedex and DHL are stubbornly holding prices at pandemic levels, originally claiming "peak surcharge" and now blatantly just ripping off as many SMEs as they can until everyone will either get sick of it or go bankrupt.
Been watching a lot of your videos and so much stuff makes more sense, especially why things are done in such strange ways. From safety wired windshield wipers to landing gear lock pins in the cockpit it is all for safety and redundancy. I think the landing gear lockout pins living in the cockpit is a great example and it makes sense why. Very impressive how everything is done but there is still room for improvement in some areas.
Still waiting for the hybrid airships cargo lifters they promised would fill the gap between fixed wing cargo and surface shipping. 😂
I wonder if volume is the limiting factor rather than weight whether there might afterall be a freighter version of the A380?
I doubt it as the a380 is so large and heavy it is restricted to airports whose infrastructure can accommodate it.
The A380 will never be a cargo plane. Airbus originally planned to build them (UPS was very interested) but they realized it would not be an efficient freighter. If it was viable they would already have been converted instead of sitting in the desert.
We are going to be feeling the effects and costs of the scam for decades.
What do I think? I think this video contained a lot of information compacted well into a relatively short video meaning a lot of effort in the background to produce such a valuable content. Well done Mentour Now team!
Agreed, he and his team do a great job!
A truly fascinating and well done story about the air cargo industry and the many complexities they face.
Thanks for a great story!
Glad you enjoyed it!💕💕💕
Qantas sent off 2 of their A330s for P2F, and now has to wet lease 2 A330 from Finnair to get their international capacity back to prepandemic levels.
Great video, it’s rare to see content creators for aviation talking about air cargo. However some of your market background are incorrect or outdated.
1) The air freight industry has already been in the pits since November 2022, where there was no black friday or christmas rush which typically happens. Market rates from Asia to Europe and the US were softened to the point of below annual average in 2019. However this holiday season paints a better outlook as capacity is completely wiped out to America and certain parts of Europe.
2) The drivers of demand and supply went in extreme polar opposites due to huge inventory overhangs in Europe and US in 1st half of 2023, coupled with companies that engaged in more aggressive carbon emission controls in their supply chain - led to less cargo on the aircrafts and more on the ULCCs
3) Relying on just fedex as one case maybe inaccurate. Pilots can always choose to fly for another airline outside of US as the pilot shortage is rampant not only there 😂
Oh and also, not all lithium battery products need to be fitted into fire bags, it depends on the IATA DGR, your typical iphones, laptops and be moved in boxes that meet the IATA DGR safety limits
One thing you didn't touch on is the loss of the nose loading 747. As far as I know the only strait in loading aircraft that are still in production is the C130J that does have a civilian certified version available and the A400M that I don't think has a civilian version. This is obviously a niche market but being from Alberta Canada I know that the oil industry ships large components that won't fit in a traditional cargo door.
It seems to me like all of the companies involved made long term plans based on current situations being the normal future. Nothing could be further from the truth because the current situation was guaranteed to change radically. The only question left was "How fast?"
And how anyone can discuss this topic without mentioning the effect of inflation on our budgets is beyond me. I guess if you are on a pilots wages you don’t notice it.
I did mention fuel prices, which are inflation-driven
I wouldn't be surprised if this spawns some PhD's in economics. I have a double major in economics, and one would expect a "cobweb" effect - so called, because the market trying to restore equilibrium in these types of circumstances looks like a cobweb in diagrams.
Petter: "The freight industry doesn't work in a vacuum.." That's a shame, as it would be entirely safe to carry lithium ion batteries:-)
Excellent video thanks Petter.
Very comprehensive explanation! Great...
The reasons given changed direction so quickly, I found myself scratching my head towards the end. I'm happy you understood!
I’m not sure global ocean companies are all that secure anymore.
Boeing in gatwick has two lines open for the bcf, both converting 737-800s, with a steady supply of more planned. Everything will be just fine 😀
moment einmal : laut unserem Luftfahrtbundesamt oder der kopie u.s. luftfahrtamt müsst ihr piloten.-/innen einen Flugstundennachweis führen (wie wir unsere lenk.-/ruhezeit & arbeitszeitnachweis mit nem'bus ) und das bei sämtlichen luftfahrzeugen sogar ballone
The business is obviously filled with opportunists rather than strategists. A five to ten years from now little of these players will still be in business, I foresee.
The Australian government briefly increased unemployment benefits dramatically, allowing people to update their clothing, footwear, and to get a some reliable technology. Sadly at the first step down from the highest rate it once again became the lowest rate of assistance in the OECD, then dropped into an extreme poverty rate again.
Bravo, excellent work! Not only the superb analysis but also amazing video and graphics! thx, petter!!
Great video with interesting analysis. On the other hand, I missed any comment on medium haul and regional freighter markets...
Just a joke, if sending tons of bubble wraps across the world became the new norm, when we can see a A380 freighter revive from the scrap to be the bubble wrap oriented giant freighter?
22:48, don’t forget about mechanics to fix those planes too!
Can we mention how the standard edition American worker/ consumer has had stagnant wages for decades, and this was facilitated by low / zero percent interest rates which are now gone. Housing costs are through the roof, fuel is through the roof, food is through the roof , medical costs through the roof. People cannot refinance their homes anymore to pay off credit purchases. So now we are seeing the REAL ECONOMY .....Things are going to get very bumpy soon , I cannot see how people cannot see it. also- I believe US domestic passenger travel will drop off sharply next year and there will be more consolidation like Alaska and Hawaiian....