Qantas (ASX:QAN) share price lifts as airline expands freight capacity

The growth in e-commerce has led to increased demand for rapid freight transport.

| More on:
a young girl wearing a set of airplane wings stands on a tarmac with hands in the air and an excited look on her face as though she is about to take off.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Qantas Airways Ltd (ASX: QAN) share price is lifting in early trade, up 4.42% to $5.20 per share at the time of writing.

That will come as welcome news to shareholders who've watched shares drop 14.9% over the past month as at this morning's opening.

The Qantas share price came under renewed pressure from high jet fuel costs, a sluggish reopening of Australia's state and international borders, and the emergence of the Omicron COVID variant out of South Africa seeing some travel restrictions reinstated.

While the airline remains bullish about the global reopening and the return of international passengers, it's also turning its attention to the growing demand for air freight.

The growth in Aussie e-commerce, a trend kicked into high gear by the pandemic, shows little sign of reversing. And people ordering their holiday gifts online expect to see them delivered rapidly.

What are the airline's freight plans?

Qantas is planning to convert 2 of its Airbus 330 planes to carry freight rather than people, with completion expected in 2023.

As 9 News reports, 1 of the planes will be used to deliver parcels for Australia Post while the other will deliver contents internationally.

With the Christmas crunch already here, Qantas will bring a third freight aircraft online this week for Australia Post to deliver gifts around the country.

According to Qantas CEO Alan Joyce (as quoted by 9News):

People are now used to and they expect that when they order something online, it's there within a day or two. Qantas is getting itself ready for that demand… By Christmas, three Qantas A321 freighters will be in operation for Australia Post…

The converted A330 aircraft for Australia Post will be able to carry around 50 tonnes of cargo each flight, more than double the capacity of other freighters operating for the national postal service.

Once the 2 converted aircraft join the fleet, Qantas will operate 25 dedicated cargo planes.

Qantas share price snapshot

The Qantas share price is down 7% over the past full year. That compares to a 12 month gain of 9% posted by the S&P/ASX 200 Index (ASX: XJO).

Since the 20 March 2020 pandemic lows, Qantas shares have soared 117%.

The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Travel Shares

Bored woman waiting for her flight at the airport.
Travel Shares

Why is the Flight Centre share price falling today?

What's going on with this travel agent's shares?

Read more »

Man sitting in a plane seat works on his laptop.
Travel Shares

A 'once in a lifetime' opportunity for Qantas shares?

Can this stock fly higher?

Read more »

Two elderly men laugh together as they take a selfie with a mobile phone with a city scape in the background.
Travel Shares

Act fast if you want to receive the next Flight Centre dividend

It won't be long until this travel agent pays its next dividend.

Read more »

Man sitting in a plane looking through a window and working on a laptop.
Travel Shares

Why is the Webjet share price racing to a 52-week high today?

Webjet has been busy talking up its WebBeds business this morning.

Read more »

A businessman points a finger in accusation, indicating a share price or ASX company in trouble
Travel Shares

Qantas shares hit turbulence amid $250,000 fine for 'shameful' conduct

ASX 200 investors are bidding down the Qantas share price on Wednesday.

Read more »

A woman ponders a question as she puts money into a piggy bank with a model plane and suitcase nearby.
Travel Shares

Flight Centre shares plunge 7% despite return of the interim dividend

ASX 200 investors are sending the Flight Centre share price spiralling lower on Wednesday.

Read more »

Happy couple looking at a phone and waiting for their flight at an airport.
Earnings Results

Flight Centre share price on watch amid 565% half-year profit surge

Flight Centre shares could see some sizeable moves today after the ASX 200 travel stock reported on its half-year results.

Read more »

Two elderly men laugh together as they take a selfie with a mobile phone with a city scape in the background.
Travel Shares

Own Flight Centre shares? Here's what you need to know ahead of its results

The travel agent giant is releasing its results on Wednesday next week.

Read more »