AIR Canada released its first-quarter results, revealing a 40 per cent decline in cargo revenue, amounting to US$177 million.
The decrease was primarily attributed to reduced throughput in the Pacific market. This occurred as the airline returned planes that were previously used exclusively for cargo operations during the pandemic back to passenger service.
air Canada's cargo sales also suffered due to a 13-month air freight recession that led to a significant drop in shipping rates, with weak demand affecting all airlines.
Compared to their peers, Air Canada experienced a higher decline in cargo revenue, while United Airlines, American Airlines and Korean Air reported declines in the range of 37 per cent to 51 per cent during the same quarter.
However, the decline was partly offset by increased freighter operations in Central and South America, as well as Europe.
By the end of the first quarter, Air Canada Cargo had four Boeing 767-300 converted freighters, compared to one during the same period in 2022.
In the fourth quarter of 2022, cargo sales at Air Canada also decreased 40 per cent due to the global economic downturn.
While two newly purchased Boeing 767s arrived at Air Canada's main hub in Toronto, they are still undergoing preparations for commercial service.
Additionally, an Israeli airframe maintenance company will reconstruct one more medium-widebody aircraft for Air Canada this year.
If production remains on schedule, Air Canada Cargo will have seven freighters in operation by the end of the year.
In May, Air Canada Cargo expanded its operations by introducing weekly freighter service to Punta Cana, Dominican Republic, and adding two weekly flights to Miami and Atlanta, as well as one to Liege, Basel, also became a freighter destination in April.
The freighter division's network includes Dallas, Mexico City, Guadalajara, Quito, Lima, Bogota, Frankfurt, Cologne, Barcelona and Istanbul.
The establishment of a cargo airline within Air Canada aims to diversify revenue streams and capture additional business opportunities by utilizing the wider passenger network to transport shipments from limited freight routes and provide shippers access to multiple destinations.
Despite the challenges in the cargo sector, Air Canada reported strong demand across all passenger segments, resulting in adjusted earnings of $306 million and revenue of $3.6 billion, surpassing consensus estimates.
Adjusted earnings showed a significant improvement of $412 million compared to the previous year, although the company reported an operating loss of $12.6 million.
Air Canada's advance ticket sales indicate robust booking activity for the remainder of the year.
Recently, Air Canada raised its 2023 guidance due to stronger traffic, higher fares, and lower fuel costs.
SeaNews Turkey
The decrease was primarily attributed to reduced throughput in the Pacific market. This occurred as the airline returned planes that were previously used exclusively for cargo operations during the pandemic back to passenger service.
air Canada's cargo sales also suffered due to a 13-month air freight recession that led to a significant drop in shipping rates, with weak demand affecting all airlines.
Compared to their peers, Air Canada experienced a higher decline in cargo revenue, while United Airlines, American Airlines and Korean Air reported declines in the range of 37 per cent to 51 per cent during the same quarter.
However, the decline was partly offset by increased freighter operations in Central and South America, as well as Europe.
By the end of the first quarter, Air Canada Cargo had four Boeing 767-300 converted freighters, compared to one during the same period in 2022.
In the fourth quarter of 2022, cargo sales at Air Canada also decreased 40 per cent due to the global economic downturn.
While two newly purchased Boeing 767s arrived at Air Canada's main hub in Toronto, they are still undergoing preparations for commercial service.
Additionally, an Israeli airframe maintenance company will reconstruct one more medium-widebody aircraft for Air Canada this year.
If production remains on schedule, Air Canada Cargo will have seven freighters in operation by the end of the year.
In May, Air Canada Cargo expanded its operations by introducing weekly freighter service to Punta Cana, Dominican Republic, and adding two weekly flights to Miami and Atlanta, as well as one to Liege, Basel, also became a freighter destination in April.
The freighter division's network includes Dallas, Mexico City, Guadalajara, Quito, Lima, Bogota, Frankfurt, Cologne, Barcelona and Istanbul.
The establishment of a cargo airline within Air Canada aims to diversify revenue streams and capture additional business opportunities by utilizing the wider passenger network to transport shipments from limited freight routes and provide shippers access to multiple destinations.
Despite the challenges in the cargo sector, Air Canada reported strong demand across all passenger segments, resulting in adjusted earnings of $306 million and revenue of $3.6 billion, surpassing consensus estimates.
Adjusted earnings showed a significant improvement of $412 million compared to the previous year, although the company reported an operating loss of $12.6 million.
Air Canada's advance ticket sales indicate robust booking activity for the remainder of the year.
Recently, Air Canada raised its 2023 guidance due to stronger traffic, higher fares, and lower fuel costs.
SeaNews Turkey