Airlines turn to ferrying cargo to boost flagging revenues

In a statement, Air New Zealand Ltd and Delta Air Lines Inc stated, they will now offer cargo charter services on passenger planes in a bid to boost revenues.

The development comes as the U.S. Senate nears a vote on a bill to give U.S. carriers $58 billion in economic aid, which includes payroll support.

The passenger air travel industry has been decimated by the Wuhan coronavirus outbreak, with Australia’s Flight Centre Travel Group Ltd announcing today that it would cut 6,000 travel agent roles globally, either temporarily or permanently.

On Thursday, shares of Singapore Airlines Ltd went into a rare trading halt pending an announcement that it would ground the bulk of its fleet and seek more financing as it grapples with the Wuhan coronavirus pandemic.

In a statement, Paul Scurrah, the Chief Executive of Virgin Australia Holdings Ltd said, the carrier plans to permanently cut more than 1,000 jobs among the 8,000 staff that have been stood down due to cuts to its flying schedule.

“That is going to be heartbreaking for those people. This is no fault of theirs,” said Scurrah to the Australian Broadcasting Corp. “This is the worst airline crisis the industry has ever seen.”

New Zealand’s Auckland International Airport Ltd said it had cut 90 contractors and was talking to its staff about reducing hours and salaries by 20% as demand plummets.

United Airlines Holdings Inc, in the U.S., has announced further trimming to its domestic capacity, as a result its overall capacity will be reduced by around 68% in April.

The U.S. Senate is preparing to vote on an industry aid bill which will cover around 750,000 employees’ paychecks.

In New Zealand, in an effort to raise revenues and keep planes flying in the air, Delta and Air New Zealand said their passenger planes will be available for cargo charters.

“We’ve shared these options with our global cargo customer base and are getting some strong interest from customers wanting to ship to and from Shanghai, Hong Kong, San Francisco, Los Angeles, Sydney and Melbourne,” said Rick Nelson, General Manager Cargo at Air New Zealand.

According to Cirium, an aviation research firm, around 1,800 planes had been grounded globally on Monday and Tuesday.

In a statement, the International Air Transport Association (IATA) said, red tape is holding up medical and other emergency supplies needed to help tackle the Wuhan coronavirus crisis.

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