Shipping crisis pushing some companies to charter cargo planes for $2 million or more
Some flights will cost upwards of $3 million to charter
Shipping companies have started to charter air cargo planes for enormous sums for a single flight as the shipping crisis continues to grow more severe.
Trans-Pacific charter company Air Charter Service reported that a Boeing 777 flight is going for at least $2 million. The pre-pandemic peak price was around $750,000.
Some companies have reported rates closer to $3 million for flights out of Vietnam, Insider reported. The Southeast Asian country serves as a major manufacturing base for clothes, shoes and electronics.
Typically around 90% of the world’s traded goods travel via ocean freight due to its significantly cheaper costs, but the delays have forced companies to search for alternatives. Even Amazon is reportedly looking to buy secondhand cargo jets to alleviate its own shipping delays.
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"We’re chartering like mad," Marc Schlossberg, executive director for air cargo at Unique Logistics, told American Shipper.
Shipping delays have been mounting and cargo has been piling up at California ports. Tens of thousands of containers are stuck at the ports of Los Angeles and Long Beach in California, which move more than a quarter of all American imports, according to The Wall Street Journal, which noted last month that dozens of ships are lined up to dock with waiting times stretching to three weeks.
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Sarah Galica, Home Depot’s vice president of transportation, told the Journal that the idea of using private charters started as a joke. In May, someone said, "Let’s just charter a ship" in order to bring goods in faster: Now, the company is chartering ships and planes to try and avoid further delays.
Those delays have spilled over to commercial airports with traditionally strong freighter traffic – such as Chicago's O’Hare, Los Angeles, Dallas-Fort Worth and New York’s JFK – which are incredibly crowded due to workforce shortages that have added delays from three days to two weeks for terminals to make shipments available.
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"October is probably going to be one of the worst months [ever] in terms of airfreight transportation for the shipping community," said Edward DeMartini, vice president of air logistics development for North America at Kuehne + Nagel.