Most airlines in recent years permanently grounded their fleets of Boeing 747-200 jumbo jets as fuel prices skyrocketed because the aircraft burns much more fuel than other freighters such as the 747-400.
And then there is Kalitta Air.
Kalitta Air is an all-cargo carrier, based at the Willow Run Airport in Michigan, that does a lot of transport for the U.S. military and operates charter flights for shippers. It was founded by Conrad Kalitta in 2000.
Kalitta operates eight Boeing 747-400s and 14 747-200 freighters, according to the company's latest brochure.
The company's contracts with the U.S. military were lucrative enough that they essentially subsidized use of the inefficient aircraft, Bryan Perraud, vice president of sales for Kalitta's global sales agent Wallace Air Cargo Group, said in a phone interview. But as the military winds down operations in the Middle East and Afghanistan that defense business will continue to decrease and Kalitta will look to expand other business lines, such as scheduled routes, that possibly offer lower margins.
During the next two years, Kalitta plans to begin replacing some 747-200s if it can find used 400s at the right price, Perraud said.
Airlines have rapidly retired 747-200s in recent years. There are about 30 747-200s in service worldwide today, down from about 140 at the beginning of 2008, and that number will probably be cut in half within a year, William Flynn, president and chief executive officer of Atlas Air Worldwide, said during a panel discussion at the Council of Supply Chain Management Professionals' annual conference in Atlanta two months ago.
There are about 150 747-400 freighters operating today, he said.
Kalitta hauls cargo for the Defense Department as part of the Civil Reserve Air Fleet under a contract that guarantees a minimum amount of peacetime business in exchange for giving the military supplemental airlift in times of crisis.
This year the Air Mobility Command expressed preference for the first time that carriers utilize the more modern 747-400s where possible to carry out work under the CRAF program. Kalitta has enough 400s to fulfill its long-term military contract, Perraud said.
Kalitta also operates many ad hoc charters for the military, military contractors and the U.S. government. The 747-200s are suitable for the short, high-cycle intra-Middle East flights that Kalitta does, he explained.
As the 747-400s become "classic" aircraft too, their price on the used aircraft-market is expected to come down, making them affordable for carriers like Kalitta, Perraud said.
Kalitta operates scheduled transpacific flights from Hong Kong to the United States and moves all military mail for the U.S. Postal Service between New Jersey and Bahrain. On the return leg from Amsterdam, Wallace sells the balance of the space to commercial customers. - Eric Kulisch