The same people that love to quote wolf saying “there’s no money in cargo” also like to quote “we fly they manage”… anyone throwing around absolutes like they fully understand the finances behind it are ignorant of the risk/reward. It’s a fickle market that requires a huge investment with cut throat competition. It would probably take 10 years of forecasted high revenue cargo for us to really gamble on it from a company level. Pilots are available and there are a lot of acme cargo operations with their sights set on those same contracts. It’s a nuanced argument either way.

 

Answer this question. Is ROI measured as "YES/NO"? If you answer correctly you'll understand my argument. In this industry you have to make the most money possible with your capital & labor. Making $100,000 on a cargo segment doesn't cut it when the same assets can make more flying passengers with belly cargo. As someone else rightfully pointed out, there are a lot of lower cost options in the cargo market. We can and will cherry pick high yield cargo when it makes sense. There's no way we'll operate a fleet of dedicated freighters.

FWIW we are not structurally the same as the carriers you mentioned. They can probably pull off freighter ops for the same reason they can operate A380s. You can find a detailed answer right from the source if you're really interested. The execs have been very open about our cargo business.

 

They won’t allow everyone to use points to upgrade. The point upgrades are very limited. They will offer the opportunity to pay for upgrades to non point upgrade customers when they check in on the off chance Polaris is not fully booked. A point upgrade to Polaris on an international flight is rare air if you read any of the travel blogs.

 

Lots of US airlines have had dedicated cargo operations. Most were not successful or at best marginally profitable in the good years. The biggest problem is you are competing with yourself on a low yield product. Thats never a good idea. Current international air freight rates are mostly in the 1 to 2 dollars a pound range. A discussion on Lufthansa cargo is included below. On the subject of narrow bodies over the Atlantic for the most part they are not profitable. Look at how JetBlue is doing in the best international market to Europe in 30 years. They are useful as place holders in the winter and for network reach in some situations.

"Lufthansa management forecast a slight increase in demand for 2024, with profit levels staying about the same, despite robust airfreight volumes across the industry so far this year. Market researchers report air cargo volumes jumped about 14% in January and an additional 11% in February compared to the same periods in 2023.

A major headwind for cargo was the company’s injection of more passenger flights, which raised the amount of cargo capacity across the network by 7% and weighed on pricing. In fact, volume of 7.5 billion freight ton-kilometers was 3% higher than the previous year, while yields fell 39.3% — an indication the top line was most harmed by falling rates. Increased capacity was reflected in a 1.9-point drop in the cargo load factor, meaning less than 60% of available cargo space was filled."

 

I have time for APC......don't know if I have time for that.

 

I mean maybe you are right.......I'm just having a hard time figuring out why there have been over 550 orders spread across 25 carriers for the a321xlr if all they are going to do is loose money or be winter time placeholders.

 

There are a few other routes they can be flown on. Also cost dynamics are quite different for European carriers. Their pilot cots over the pond are probably ⅓ the cost for US airlines.

 

Have you flown SA on international flights lately? 24 hours out, the Upgradeable Premiers populate like a domestic flight!! These "PlusPoints" started during the pandemic, are wildly popular with the muckity mucks. Polaris tends to fill up like DEN-IAH on a Friday.

From Nerd Wallet:

PlusPoints act as upgrade certificates for your flights, and they work on both domestic and international routes. Depending on your fare class, it can cost as little as 40 PlusPoints to upgrade from economy class to Polaris business class on a long-haul international route.

Once you reach Premier Platinum or Premier 1K, you'll immediately receive PlusPoints based on your status: 40 PlusPoints when you reach Premier Platinum and 280 more when you reach Premier 1K. These are ANNUAL allotments.

 

Yes I have. The customers select plus points upgrade when they book the ticket. It’s not usually instantaneous they get their upgrade . No guarantee they get a seat upgrade. They will sell upgrades for non plus points up to check in cutoff time. Yes the list may be long but not all get seats. Also those plus points come with a minimum spend to achieve them. They aren’t gifted. Money exchanges hands and large amount for the chance to upgrade.

How many empty Polaris cabins do you see prior to the upgrade list being cleared one hour before departure? The ability to revenue control the inventory has been better at United than it has ever been. If you yourself really want a Polaris seat for your vacation buy yourself a seat.

 

ugggghhhhhh.... they certainly earn less than us, but 1/3......I'm rubbing my chin.