On-Demand Cargo Market

[FlyMarines09]

I've seen a few posts regarding on-demand air cargo companies folding... I can see a few reasons why that would be, however, can anyone point me in the direction of actual studies related to the economics of chartered cargo? Why are the companies going under? Is there little to no market demand for this type of service?

I've Google'd it in a few times and I've been unsuccessful in getting any actual data. I'm doing a feasibility study on the subject for a college business class and any information would be helpful.

Thanks

 

[z987k]

Are you talking about the DHL carriers?

 

[jhugz]

It's like playing the stock market. If the auto industry goes to hell, there goes your job. You don't have a fluffy contract like UPS/DHL/Bank/Hazmat cutting you a check every month. If you don't fly, your company goes under. The profit margin is much higher, meaning you can make some bank doing this type of flying, but again, industry slows down, you're SOL. The companies that seem to do well in this market are the ones that are established elsewhere and use this type of flying to supplement their company. Basically not keeping all their eggs in one basket. Also most of these companies have terrible airplanes for the type of flying. DA20's without Garretts are a nightmare in regards to fuel/mx costs. They're damn tough to make money on. Most of these companies however can't afford to slap the garretts on to be more competitive. There's a start.

 

[Maurus]

Not to mention those falcons are looking really tired. Worse than our higher time metros. If fuel keeps going up I don't see the jet on demand guys sticking around.

 

[jhugz]

Not to mention those falcons are looking really tired. Worse than our higher time metros. If fuel keeps going up I don't see the jet on demand guys sticking around.

I do, not in Falcons though. There will still be demand for expedited items that need jet speeds. Most of the time though the bulk isn't an issue. A lot of these companies like Royal, Kalitta, will do fine with their 35's.

 

[turbomax97]

Yeah the Falcon was good back in the hey day but it's a losing battle with the CF700's - period. The metros always did well operationally and performance wise....and the time difference was less than an hour on freight due to fuel restricted falcon trips.

On demand freight will always be there.... but at my prior company... instead of ~30 airplanes.... they shrunk to 2. Between 2008 - 2011, that's all the on demand business which existed.