Demand for air freight was a bright spot in the aviation industry during the COVID-19 pandemic amid shipping disruptions and passenger travel whittling down to next to nothing — but the tide has turned.
Now, demand for air cargo has slowed so much that logistics giant FedEx is encouraging its pilots to apply for a job with PSA Airlines — a regional carrier unit of American Airlines.
“Given the softness in air cargo demand across the industry and current FedEx flight operations staffing levels, we shared information about this unique opportunity with our pilots,” a FedEx spokesperson told Insider. FedEx employs around 5,800 pilots globally, while PSA Airlines has about 1,900 pilots.
Interested FedEx pilots are eligible for an expedited interview process for a captain’s position with PSA Airlines, according to the latter’s online recruitment page. PSA Airlines is also offering FedEx pilots $250,000 in sign-on bonuses.
Pat DiMento, the vice president of flight operations and training at FedEx, told staff in a Friday memo that the cargo airline is “significantly overstaffed,” according to a Sunday report by FreightWaves, a trade publication. FreightWaves first reported on the development.
That’s amid global air cargo volumes falling over 8% year-on-year since the first quarter of 2022, while cargo rates have slumped 40% to 50% for most of this year compared to 2022, according to FreightWaves.
The decline in air cargo demand is due to a plunge in ocean freight rates and the resumption of travel post-pandemic, which allows passenger flights to carry cargo alongside travelers.
Meanwhile, US passenger airlines have been plagued by a pilot shortage — which is bad timing, given a post-pandemic travel boom.
“FedEx and American Airlines have had a good relationship for many years, and their recognition of the quality of our crew force is clear in this recruitment initiative that provides FedEx pilots an additional career path opportunity,” said the FedEx spokesperson.
FedEx shares closed 0.7% lower at $245.33 apiece on Monday. The stock is up 42% so far this year.