Tuesday, May 26, 2020

econlife - What You Might See on a Ghost Flight by Elaine Schwartz

Airplane seats can be a problem, even when a plane is empty.

So Korean air decided to place all of the emergency medical supplies and agricultural goods it was transporting to Ho Chi Minh City in its Airbus 330-300 cargo hold.

Where are we going? To the ghost flights that are carrying cargo.

Ghost Flights

Whether it’s Delta in the U.S., Lufthansa in Germany, or Turkish Air, ghost flights are the new normal. Because passenger volume has evaporated, freight makes sense. In a Boeing 777, the baggage compartment can hold the equivalent of 33 Toyota Corollas. One American flight between Dallas and Frankfurt had no paying customers, just goods that included military mail and machine parts. During the return flight, the size of the cargo almost doubled.

American Airlines provided this partial image of its 777-300 cargo hold. Great for baggage but not freight, the hold is divided into smaller sections:

As a relatively insignificant slice of revenue, freight on a passenger jet is nothing new. Now though, it makes sense to carry much more. Fuel is cheap, pilots are paid whether they fly or not, and freight rates have increased. Furthermore, one condition of U.S. stimulus aid is that airlines keep flying.

Still, many cannot. The number of stored planes has soared:

Our Bottom Line: Land, Labor, Capital

As economists we could say we are just talking about the factors of production. Flying freight rather than passengers, airlines need to reallocate their land, labor, and capital.

The massive change in land, labor, and capital surely means that airlines like Korean Air and American, will just use their cargo hold.

My sources and more: Thanks to fivethirtyeight for alerting me to the air freight carried by passenger planes. From there, PopSci, FlightGlobal and Wired had all the details.

Ideal for the classroom, econlife.com reflects Elaine Schwartz’s work as a teacher and a writer. As a teacher at the Kent Place School in Summit, NJ, she’s been an Endowed Chair in Economics and chaired the history department. She’s developed curricula, was a featured teacher in the Annenberg/CPB video project “The Economics Classroom,” and has written several books including Econ 101 ½ (Avon Books/Harper Collins). You can get econlife on a daily basis! Head to econlife.