Buoyed by a strong freight performance in 2021, Air Canada is investing in its cargo capabilities and adding three Boeing freighters to its fleet this year with an eye to building an eight-strong freighter fleet. In December, Air Canada introduced its first dedicated freighter after relying on temporary conversions of passenger aircraft to service the burgeoning demand for air cargo services throughout the pandemic. More recently, an Air Canada executive outlined the airline's cargo plans for this year.

"Our cargo revenue reached CA$490 million in the fourth quarter of 2021, which represented an increase of $204 million when compared to the same quarter in 2020 or more than 160% over the same quarter in 2019," said Lucie Guillemette, Air Canada's Executive Vice President and Chief Commercial Officer in a recent earnings call.

"Air Canada Cargo operated 10,217 cargo-only flights in 2021 compared to just over 4,235 in 2020. In December, we reached another milestone with our first Boeing 767 dedicated freighter beginning operation. We expect to have three additional Boeing 767 freighters in our fleet by the end of 2022."

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Air Canada's Executive Vice President and CCO Lucie Guillemette. Photo: Air Canada

Three more Boeing freighters are due this year

The permanent conversion of a former Boeing 767-300ER into a freighter last year allowed Air Canada's first dedicated freighter to start operations. At the time, Air Canada said the freighter would allow Air Canada to provide consistent capacity on key air cargo routes, increase its capabilities to transport heavy and bulky goods, and meet the growing demand for fast, reliable shipment of e-commerce products.

Air Canada's choice of Boeing 767-300ER freighters allows the airline to offer five different main deck configurations, increasing the overall cargo capacity of each aircraft to nearly 58 tonnes or 438 cubic meters, with approximately 75% of this capacity on the main deck. The Boeing 767 is fast finding a second life running dedicated freight ops with many airlines, a longstanding workhorse of airlines worldwide.

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Throughout the pandemic, Air Canada has relied on temporarily converted passenger aircraft to operate cargo flights. Photo: Air Canada

Long term cargo demand warrants dedicated Air Canada freighters

As passenger demand steadily ramps up again, Air Canada will send its Boeing 777 and Airbus A330 passenger planes now used as freighters back to passenger operations by the end of this year, increasing the need for full-time dedicated freighters. While passenger flights remain Air Canada's core business and the top source of revenue, cargo is gaining in importance and increasing its share of overall Air Canada revenues.

"Cargo business is an important part of our recovery and long-term growth, helping with seasonality and diversification," notes Ms Guillemette.

All up, Air Canada will convert eight of its former Boeing 767-300ER aircraft into dedicated freighters. Air Canada has operated a number of the planes on passenger routes over the years and still has several parked or stored. The second converted Boeing is due in the first half of this year, with the two others flagged in the earnings call due in the second half of the year. The remaining four converted freighters will start landing from next year.

Across calendar 2021, Air Canada earned almost CA$1.5 billion in cargo revenues for the first time in its history, a figure Lucie Guillemette says validates Air Canada's decision to invest in fully dedicated cargo aircraft.