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Freight forwarders double down on air charter networks

Flexport, Geodis, and DSV control their own freighters to ensure capacity in tight market

Geodis is a logistics company, not an airline. But acts like one to move freight and outsources the flying to partner airlines. (Photo: Geodis)

Several global freight brokers expanded their private air networks in January to guarantee reliable transport for customers in response to high import/export demand, tight aircraft supply and severe ocean shipping delays.

The new services give customers more shipping options during a year when airfreight demand is forecast to continue growing, especially in the near term as congested airports scale back workloads and carriers cancel flights due to the rapid spread of the omicron variant. Forwarders say charter demand is especially high in the automotive, high-tech and retail sectors.

Last year, air cargo volumes grew nearly 7%, according to the International Air Transport Association. 

Third-party logistics provider Flexport on Thursday announced it will add a third Boeing 747-400 to its dedicated fleet operated by Atlas Air (NASDAQ: AAWW) in September, right before the traditional busy season for moving merchandise across the Pacific for large holiday shopping events. 

Atlas currently operates flights six to seven times a week for Flexport from Asia to Los Angeles and Miami. The long-term charter arrangement increases cargo capacity by 50% and allows for increased schedule flexibility as new origins and destinations are added this year. Flexport said it plans to add Chicago O’Hare International Airport as a destination this year. 

San Francisco-based Flexport, which relies on a sophisticated technology platform to facilitate information sharing and logistics decision-making, decided early in the pandemic to secure long-term capacity from airlines rather than have to compete daily for limited aircraft space, a situation magnified by reduced passenger airline operations.


Flexport originally rented two aircraft from Atlas, the largest operator of 747 freighters in the world, and took block space agreements with other carriers to protect customers and keep their supply chains moving. 

“Forwarders typically don’t like to take long-term capacity agreements with airlines, particularly to take on their own dedicated capacity. … The vast majority have shied away because they tend to be asset-light in their thinking. But over the past 18 months you saw a lot of different entities that wouldn’t have done this pre-pandemic that saw the need to do this,” Neel Jones Shah, Flexport’s global head of airfreight, said on the “Cargo Masterminds” podcast from STAT Media Group last summer.

European forwarders 

France-based Geodis said it recently added three flights to its AirDirect network in the Asia-Pacific in response to high demand for e-commerce and other cross-border trade, increasing its weekly capacity by 320 tons. Geodis controls five aircraft cargo jets — a mix of 747s and Airbus A330-300s — operated by strategic partners Atlas Air, AirBridgeCargo and AirAsiaX.

The logistics company now offers weekly services from its hub in Kuala Lumpur, Malaysia, to Shanghai and Sydney, a second weekly rotation between Kuala Lumpur, Hong Kong and Chennai, India.

The new hub in Kuala Lumpur serves as a consolidation center for goods manufactured in China, Malaysia and Vietnam arriving by road or air, giving customers more choices to balance transit time and cost, according to the company. The Geodis road network connects Singapore, Malaysia, Thailand and Vietnam to the hub. 

Last year, Geodis launched a twice-weekly charter service that operates from Zhengzhou, China, to Amsterdam, London Stansted and back to Zhengzhou, as well as a twice-weekly connection from China — Shanghai and Hong Kong — to Guadalajara, Mexico.

Geodis this month opened a new 43,000-square-foot cargo facility at Paris Charles de Gaulle Airport, with space to handle up to 20,000 tons of cargo annually. The transit facility is operated by Worldwide Flight Services.

Another major European freight forwarder, DSV, announced on LinkedIn that it has added capacity to its air charter network in and out of Asia. The Denmark-based company increased the Hong Kong-Liege, Belgium, route to three times per week and introduced a weekly service between Singapore and Los Angeles.

In September, DSV introduced its Globetrotter service connecting four continents with a Boeing 747 freighter. The route network includes Liege, Chicago Rockford International Airport, Hong Kong and Viracopos airport in Brazil.

DSV charters either entire aircraft or arranges part-charters on both a scheduled and ad hoc basis. It has agreements with Cargolux, one of the largest cargo-only airlines in the world, as well as Atlas Air and other operators.

Meanwhile, Austria-based cargo-partner has expanded its charter program with a new weekly connection from Vienna to Chicago O’Hare, a central point for distribution in the U.S. Midwest. The logistics company has been providing regular cargo charter flights from Hong Kong to Budapest, Hungary, since the spring of 2020 with three weekly departures, as well as flights twice a week from Budapest to Zhengzhou and back. The program also includes weekly flights from Frankfurt, Germany, to Zhengzhou and Zhengzhou to Cologne, Germany.

Since last spring, a less-than-planeload service, with several clients sharing space,has been offered with weekly departures from Hanoi and Ho Chi Minh City, Vietnam, to Munich, Frankfurt and Vienna.

Chartering aircraft is expensive — planes for short-term hire were going for up to $1.5 million per trip during a heavy period last fall — but long-term leases are more favorable. Having direct control of the aircraft gives forwarders a marketing advantage in terms of guaranteed space, plus they can determine the schedule and routes that meet their customers’ needs. Another benefit is faster turnaround on the ground because the entire contents of a plane are being handled for a single provider rather than having to be sorted first in a multi-customer warehouse. And some forwarders, like DSV, use less congested gateways. 

In most cases, the logistics providers operate warehouses at or near the destination airports and can provide door-to-door service. 

In related news, Chinese express delivery company SF Group last week extended its long-term operating lease with Atlas for a Boeing 747-400 freighter that hauls goods between China and the U.S.

Click here for more FreightWaves/American Shipper stories by Eric Kulisch.

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Eric Kulisch

Eric is the Supply Chain and Air Cargo Editor at FreightWaves. An award-winning business journalist with extensive experience covering the logistics sector, Eric spent nearly two years as the Washington, D.C., correspondent for Automotive News, where he focused on regulatory and policy issues surrounding autonomous vehicles, mobility, fuel economy and safety. He has won two regional Gold Medals from the American Society of Business Publication Editors for government coverage and news analysis, and was voted best for feature writing and commentary in the Trade/Newsletter category by the D.C. Chapter of the Society of Professional Journalists. As associate editor at American Shipper Magazine for more than a decade, he wrote about trade, freight transportation and supply chains. Eric is based in Portland, Oregon. He can be reached for comments and tips at [email protected]