UPS to buy $1.5 billion of Boeing freighters as air cargo booms

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United Parcel Service agreed to buy 19 Boeing freighter jets as soaring e-commerce and snarled shipping lines lead to a boom in air-cargo demand.

The package-delivery giant plans to accept the 767 Freighters between 2023 and 2025, according to a statement. The planes have a combined base value of $1.5 billion, according to aircraft appraiser Avitas.

Chicago-based Boeing’s shares surged 5.9% in New York. Shares of Atlanta-based UPS gained 2.3%.

The purchase bolsters the UPS fleet and adds to a record-breaking year for Boeing’s freighter sales. Air-cargo demand has surged during the pandemic amid a rise in time-sensitive online shopping that is expected to last even after Covid-19 subsides. More companies have turned to air transport lately as ocean-cargo routes suffer from delays.

UPS was the launch customer for the 767 freighters in 1995, and since then has ordered a total of 91 of the aircraft. The carrier currently operates 236 Boeing freighters including the 747, 757, 767 and MD-11.

Nando Cesarone, US operations president of the global shipping & logistics company, said: “The Boeing 767 is the most versatile aircraft we operate.” These freighters are expected to make UPS’ fleet more efficient and reliable, he added.

Boeing senior vice president of commercial sales and marketing, Ihssane Mounir, said: “Since the programme was launched, UPS has recognized the value of the 767 freighters and utilised the airplane’s outstanding cargo capabilities throughout its network. These new jets will enable UPS to meet expected near-term and long-term cargo demand with the proven economics, reliability and flexibility that are synonymous with the 767 Freighter.”

The deal adds to a record-breaking year for Boeing freighter sales, including 80 firm orders for new widebody freighters and more than 80 orders for Boeing converted freighters.

Boeing’s 2021 commercial market outlook forecasts an annual increase of 4% in air cargo demand (Freight Tonne Kilometers) over the next 20 years. With more than 270 orders since programme launch, the 767 freighter continues to play a key role in supporting this demand, together with a global freighter fleet predicted to grow by 70% by 2040.

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Devender was born in the year when the Beatles Group was formed. He holds two master’s degrees in English Literature and Public Administration. He also has an Honors degree in English Literature and a post-graduate diploma in Corporate Communications and Public Relations. He was closely associated with the Indian State Transport Undertakings and Ministry of Transport in his role as Corporate Communications and PR specialist for over two decades handling domestic and international organizations. He ventured into business forming his own Media House, Profiles Media Network Private Limited which is now a twenty years old company. Excelling as an editor, Marketing, PR, Anchor, and Advertising specialist, he is now expertly navigating the world of social media. A widely traveled professional internationally, Devender has a deep understanding of the Air Cargo, Cargo Business, Cargo Airports, Freighters and Cargo Industry at large.