DHL Express last week made two unusual additions to its roster of contract carriers that bring with them extra aircraft to help the parcel carrier meet escalating growth in e-commerce shipments.
The express delivery arm of postal and logistics giant Deutsche Post DHL Group (DIX: DPW) arranged for German leisure airline Condor and a start-up cargo division of Latvian carrier SmartLynx to fly packages in its European air network.
The first cargo flights under the Condor partnership began last week. Condor, a charter carrier for tourists, will operate four of its Boeing 767 medium-size jets for DHL until the end of May. The Condor planes will be based at DHL Express’ largest European hub in Leipzig, Germany and cover three routes – to Shannon, Ireland; Milan-Malpesa, Italy; and Cologne, Germany. DHL suggested the initial contract could be extended.
It’s the latest example of smaller passenger airlines diversifying business amid a severe downturn in travel demand and establishing full cargo divisions for the first time. The Condor deal resembles what DHL has done in the U.S. where regional carrier Mesa Air Group in October began flying converted Boeing 737-400s, an aircraft it never operated before, on DHL’s behalf.
Air Belgium is scheduled to begin operating four Airbus A-330 owned by ocean carrier CMA CGM – taking the concept of diversification to another level. And U.S. low-cost travel airline Sun Country last year began operating 737-800 freighters for Amazon Air.
“This partnership between cargo and passenger carriers is unique,” said Markus Otto, senior vice president aviation Europe at DHL Express, in a statement. “It allows us to react even faster and more flexibly to the continued high demand for international express service. The additional capacity through Condor allows us to further improve service quality and transit times, and maintain our growth trajectory.”
Since April of last year, Condor, like many passenger airlines, has emphasized cargo flights, transporting primarily medical protective equipment and e-commerce goods. At one point, 14 of Condor’s 16 Boeing 767 aircraft were being used solely for cargo. Condor has also trained and deployed a team of cargo supervisors to oversee cargo operations and ensure quality execution.
In-house airline DHL Aviation also hired SmartLynx Malta, a new cargo subsidiary of Riga, Latvia-based SmartLynx Airlines, that is one of the earliest adopters of the new Airbus A321 converted freighter.
SmartLynx Malta has leased two of the narrowbody planes and will begin operating the first one for DHL at the end of March, DHL spokesman Tim Rehkopf said. The second aircraft is still being retrofitted and will join the DHL fleet by mid-July.
SmartLynx is moving aggressively to establish its cargo division, with plans to add eight more of the well-regarded A321 freighters by 2023.
The first two A321 passenger-to-freighter conversions so far are seeing duty with Qantas/Australia Post and Titan Airways.
Aviation experts say the A321 is an excellent choice for regional and express delivery operators because it has more cargo space for containers than the 737-800, its main competition, and its fuel efficiency over older aircraft.
The A321 is “going to be a great freighter,” said Stan Wraight, CEO a;nd co-founder of Strategic Aviation Solutions, in a video chat for Global Supply Chain Week at FreightWaves.
Founded in 1992, SmartLynx is part of Avia Solutions Group, a large aerospace services company with businesses ranging from aircraft leasing to maintenance and repair. One of Avia’s cargo subsidiaries is charter airline Magma Aviation. SmartLynx has extensive experience operating the A320 and A321 as a passenger charter operator and provider of air transport for airline customers.
Smartlynx Malta says it plans to add two more A321 freighters this year and up to four units during 2022, with the goal of becoming one of the largest narrow-body cargo freight carriers within the next three years.
In January, DHL Express ordered eight 777 freighters from Boeing as part of its effort to keep up with growing cargo volumes.