sbm12

Causation or correlation? And is that market still high-yielding? There are a lot more options for flights to/from the islands than 5 or 10 years ago and some of those include HA's growing fleet of wide-body aircraft to more destinations on the mainland than UA has.

Looking at DL's 2012 10-K they show a $37mm YoY drop in cargo to $990mm from 2011 after a $177mm increase from 2010. AA's 2012 10-K says they did $669mm in cargo revenue, down 4.8% from the prior year.
In AA's Q3 '13 10-Q filing they indicate that cargo revenue is down for the 9 month period YoY ($485mm v $499). UA shows a higher drop but also a higher total revenue in the period ($662mm v $775mm in 2012). Delta is down to $699mm from $749mm.

Yes, UA is down, but I don't think that the overall numbers suggest that UA is falling apart on the cargo front.

CALMSP

Yes, that is a driving factor. When you make an IT switch, and personnel do not fully understand a system, freight gets lost, delayed, etc., and shipper moves the business elsewhere.

airzim

Cargo is absolutely not "free money." There are significant handling expenses associated with Cargo which is significantly more complex and potentially more expensive than handling passengers. Cargo is also highly directional and highly seasonal. With a few exceptions, cargo tends to be low yield hence why when you see fuel spike, cargo gets dropped.

Finally United (and all US majors) are flying smaller aircraft, with the vast majority bulk loaded rather than palletized, which adds logistic and storage issues at airports.

Cargo just isn't that important anymore.

asphaltman

I suspect the increased use of RJ's plays into the reduction of local cargo/mail. There is no room for any cargo or mail on RJ's. I assume freight brokers have a harder time with the logistics of UA's spotty schedule. RJ vs main liner on certain routes. IMHO

sbm12

How do you reconcile this against the fact that regional ASMs are down YoY at about the same rate as mainline?

entropy

c'mon sb12, you know that CO's tendency to go for the smallest aircraft they can possible squeeze on a route. They aren't looking at the underbelly. They fight for access to LHR for 'premium traffic' and then they drop 757s onto it.

This isn't an airline that is thinking big, they are a small minded penny ante operator.

FiveMileFinal

Passengers, soon.

Kacee

That's really not fair. UA is upgauging EWR-LHR to five daily widebodies during peak travel times.

CALMSP

Doesn't really play a big factor. Every airline around the world moves cargo on a truck, so any RJ isn't a factor.

LeviFlight

I find Jeff's preflight messages are often a leading indicator of a coming decline in discussed topic. Changes we'll like, 787, customer service, mileage program. I was wondering what was about to happen to cargo. So far a perfect run in forecasting doom. Jeffodamus.

CALMSP

Not a fair statement. Cargo is down worldwide, not something that is driven from anything related to Jeff.

sbm12

Are you suggesting that lots of high-value cargo moves via LHR? It sure sounds like that, and I'm willing to take that bet. Both FRA and CDG move a lot more cargo than LHR while LHR handled a whole lot more passengers.

Passengers - particularly in the premium cabins - are the high value "cargo" moving to and from Heathrow. And given CO's fleet and mix of routes at the time the 752s were absolutely the correct choice.

EWR764

Further, I doubt there is very much local cargo between EWR and LHR, or between the United States and London in general. If anything, the demand would be for bulk-loaded small packages which is adequately served whether the equipment is 757, 767 or 777. Even still, UA(CO) always had the ability to move containerized freight on EWR-LHR with daily 777 service since the station opened.

Most of the 'heavy' freight volume is probably carried by BA on its own metal for online transfer to its in-house cargo division. Further, as you note, FRA sees about 25% more cargo volume than LHR, which is a reason why BAWC even has regular 748F dedicated freight service to LHR.

entropy

>2 years late

The 763's aren't about the cargo on LHR, they're about the premium traffic, if there were nothing but 757s they should have done PS style and outfitted some planes with 32C instead of a very low 16C config. They spent tens of millions of dollars on landing slots and then they shove those cheapskate aircraft in, while BA is running 744s, AA 777's VS 747s..

CALMSP

more than 75% of cargo is narrow-body capable, and regardless of who the national carrier is, freight moves between carriers all the time. Therefore, simply because one carrier has one aircraft in a location, movement to another location via a truck is done all the time. Which means AF or EI could very well move a large percentage of the UK market.