Two cargo airlines owned by major European ocean shipping companies have begun operating routes out of Asia with new Boeing 777 freighters in response to market signals for more export capacity in the region.
On Tuesday, CMA CGM Air Cargo announced that it has commenced trans-Pacific commercial service with the first of three 777-200 cargo jets ordered from Boeing. The inaugural flight took place Sunday from Hong Kong to Chicago with a refueling stop in Anchorage, Alaska. On the backhaul trip, the aircraft operates to Hong Kong via Seoul, South Korea.
CMA CGM, one of the world’s largest container lines and logistics providers, is outsourcing aircraft operations to all-cargo operator Atlas Air, as previously reported. The Paris-based freighter airline needs Atlas Air to fly across the Pacific because it doesn’t have traffic rights from the United States to transport goods from another country without first stopping in its home country.
The introduction of the 777 freighter is a significant step in the expansion of CMA CGM Air Cargo’s fledgling network as routes from Asia to North America typically command much higher yields than in other regions.
“We are very proud to extend CMA CGM Air Cargo’s reach to the United States, a strategic country for the Group,” said CEO Damien Mazudier in the announcement.
Boeing is scheduled to deliver another freighter in the fourth quarter, which CMA CGM said Tuesday will be deployed between mainland China and North America. The two freighter aircraft will offer a combined seven frequencies per week on the trans-Pacific lane. CMA CGM said it plans to welcome a third 777 production freighter in the first quarter of 2025.
At that point CMA CGM Air Cargo, which was established in 2021, will have five 777 freighter aircraft available to move goods around the world. Two existing aircraft serve routes between Europe and the China region, with five flights per week to Hong Kong and four weekly flights to Shanghai. The airline also has three Airbus A330-200 cargo jets that operate around Europe and to China.
The 777-200 is a cavernous freighter with a maximum payload of 226,000 pounds.
CMA CGM launched the airline to give customers more shipping options as part of a strategic shift from a pure port-to-port ocean carrier into a global integrated logistics company with door-to-door delivery capabilities. Ocean shipping and integrated logistics rival Maersk has pursued a similar strategy.
Air cargo capacity out of Asia to Europe and the United States, especially eastbound from China, is very tight because of the boom in cross-border e-commerce shipping, constraints on ocean shipping because of hostilities in the Red Sea and trade tensions that have limited the full return of widebody passenger services between the U.S. and China. Shippers say finding space on all-cargo aircraft is very difficult on key trade lanes from China, Hong Kong and other Asia origins.
Carriers are redeploying aircraft from other regions to take advantage of much higher rates in the Asia region. Shipping rates from Shanghai to North America rose more than 25% in July compared to the same month last year, while rates to Europe increased by 44%, according to the TAC Index.
Airfreight prices out of China/Hong Kong were well above typical summer rate levels at about $5.72 from Hong Kong to North America at the end of July and $4.50 to Europe, and are expected to climb above peak-season norms in the fourth quarter.
Atlas Air on Thursday announced it has leased three Boeing 747-8 freighters from BOC Aviation to meet strong e-commerce demand, and expects them to enter service late in the third quarter.
Maersk Air Cargo
Maersk Air Cargo recently deployed its first 777 freighter. The cargo terminal subsidiary of Hong Kong-based Cathay Pacific, in a July 26 LinkedIn post, welcomed Maersk as a customer and highlighted the inaugural flight to Maersk’s base in Billund, Denmark. In mid-July, Maersk indicated the plane would be placed on the preexisting route between Billund and Hangzhou, China, but regardless of the specific airport pairs, the plane will operate between China and Billund. According to flight tracking site Flightradar24, the Maersk 777 has so far mostly operated between Billund and Birmingham, England, and to Hong Kong with a technical stop in Navoiy, Uzbekistan.
Maersk previously said it would offer three weekly flights to China and increase the frequency to six flights when a second 777 is delivered later this year.
Maersk Air Cargo has 20 Boeing 767 cargo jets in its fleet in addition to the 777s. Most of the 767s are converted freighters and operate under contract for UPS and other express carriers in Europe. In late 2022, Maersk launched 767 service between Asia and the U.S. using Miami-based Amerijet to fly the factory-built aircraft. Destinations in the trans-Pacific network include Zhengzhou and Shenyang, China; Seoul; Chicago-Rockford; and Greenville-Spartanburg, South Carolina.
Click here for more FreightWaves/American Shipper stories by Eric Kulisch.
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