Delta Cargo had a lot to celebrate in 2021: the division marked its 75th anniversary and is likely to record the best revenue year in its history, exceeding $1 billion.
Whether transporting life-saving pharmaceuticals, organs for transplant, fresh flowers, seasonal produce or beloved pets – Delta Cargo guarantees world-class service for every customer and plays a vital role in Delta's future. And even bigger goals are on the horizon for 2022 to move the business to an industry-leading position, with innovations in technology, operations and more.
Rob Walpole - Vice President, Delta Cargo – sat down to share his thoughts on some of the team's biggest accomplishments this year as well as how the business is preparing for 2022 and the years to come.
It's been a busy year for Delta Cargo. What are you most proud of?
RW: To achieve our best revenue year in the history of business, especially during a tumultuous time, is an incredible accomplishment. Our team dug deep, finding ways to innovate and reimagine how we deliver maximum value to our customers. Over the next four to five years, we will play a critical role in helping the company further diversify its revenue streams.
I'm also proud of our role in helping to navigate through the pandemic. Since the launch of our cargo-only flights in 2020, the team has coordinated over 2,600 flights to support the global supply chain and carried some of the earliest shipments of COVID-19 vaccines safely and effectively. The speed at which the team adapted to such a rapidly changing market in 2020 and carried that through 2021 has been inspiring.
Additionally, we have hired and onboarded over 500 people this year to support the operation and now have over 1,800 employees supporting Delta Cargo worldwide. Cargo is a niche and ever-evolving industry, so finding qualified people to fill some of the unique and diverse roles can be challenging. But our division exemplifies the Delta Difference, and we've used this opportunity to bring in the best talent – from within Delta and elsewhere – so we can deliver an excellent customer experience while maintaining operational performance every step of the way.
How is Delta Cargo's overall revenue performance shaping up as 2021 comes to a close?
RW: Delta Cargo is on track to have its best year in its 75-year history, and our financial targets for 2022 are even more ambitious – not only through 2022 but through 2024-2025. As we look forward to the next three to four years, we have identified several key opportunity areas that we can work with other Delta partners on (technology, operations and sales, among others), that will help us grow revenue by several hundred million dollars by 2025.
When thinking about Delta Cargo's global role, how important are the airline partners to the overall operation? What about fleet?
RW: Our global partnerships are incredibly advantageous to us. Between Delta and our partner networks, the network solutions we can offer our customers are unrivalled: we can support a customer's shipment to virtually anywhere in the world. We have as partners some of the best airlines in the world, which is a clear competitive advantage for Delta Cargo. By working together and sharing best practices, from service recovery and one-roof warehousing to working together on COVID-19 vaccine distribution, we are continually evaluating how we can maximize the opportunities for our customers through leverage of our combined networks.
Delta has also communicated a fleet plan that foresees significant additional wide-body capacity being added in the next years. This is incredibly exciting for us, particularly as global supply chains increase in complexity, because our fleet will allow us to provide more extensive services to our customers.
What are you most focused on as Delta Cargo enters 2022?
RW: We want to continue to deliver for our customers, people and our financial stakeholders in 2022, and execute on the business plan we have in front of us to achieve our industry-leading goal by the end of 2023.
One of those essential priorities is technology. While the business has made strides in the digitization space this year, we must make it as easy as possible to do business with Delta Cargo by providing differentiated products and services for our customers, while creating the most seamless process possible for our people and partners. We already have a few initiatives teed up for 2022, including launching a dynamic pricing engine that will help fuel our distribution strategy as well as implementing a loyalty program for our small- to medium-sized customers.
For all the focus on improvements in tools and technology, our people remain the critical competitive difference for us and the true key to our success. As the business grows, we need our people to grow – enhancing our training, providing development opportunities and continuing to find the best talent and supporting their growth.
Sustainability is another important focus, not only for Delta Cargo and the air cargo industry but for the air travel industry at large. Delta continues to build on our sustainability efforts since becoming the first carbon neutral airline globally in March 2020. At Delta Cargo, we began using a 100% biodegradable stretch film and pallet covers in all our stations in 2021, which significantly reduces fossil fuel-based plastic. Since making this change, the Cargo division has prevented the equivalent of more than 12 million 16 oz. water bottles from languishing in landfills. We plan to take additional action next year and in the years to come.
Any other thoughts to share as we close out 2021?
RW: While the airline industry has obviously faced significant disruptions over the last two years, those disruptions actually created opportunity for Cargo businesses to contribute in a much bigger and more impactful way than ever before. It pushed us to transform the business at an even greater speed than we thought possible and because of that, the opportunities for us today and in the future are incredibly exciting. It will be essential for us to keep the mindset of moving items as quickly and efficiently as possible, while retaining one eye clearly on the future.
One thing I know for certain is that no matter what challenges may come our way, the Delta Cargo team will be ready to tackle them head on, always keeping our customers and their cargo needs a top priority. We have a fantastic team, and I couldn't be prouder to be a part of this group. I can't wait to see what Delta Cargo can do in 2022 and beyond.
Statements made in this Delta News Hub story that are not historical facts, including statements regarding our estimates, expectations, beliefs, intentions, projections, goals, aspirations, commitments or strategies for the future, should be considered “forward-looking statements” under the Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. Such statements are not guarantees or promised outcomes and should not be construed as such. All forward-looking statements involve a number of risks and uncertainties that could cause actual results to differ materially from the estimates, expectations, beliefs, intentions, projections, goals, aspirations, commitments and strategies reflected in or suggested by the forward-looking statements. These risks and uncertainties include, but are not limited to, the material adverse effect that the COVID-19 pandemic is having on our business; the impact of incurring significant debt in response to the pandemic; failure to comply with the financial and other covenants in our financing agreements; the possible effects of accidents involving our aircraft or aircraft of our airline partners; breaches or lapses in the security of technology systems on which we rely; disruptions in our information technology infrastructure; our dependence on technology in our operations; our commercial relationships with airlines in other parts of the world and the investments we have in certain of those airlines; the effects of a significant disruption in the operations or performance of third parties on which we rely; failure to realize the full value of intangible or long-lived assets; labor issues; the effects of weather, natural disasters and seasonality on our business; the cost of aircraft fuel; the availability of aircraft fuel; failure or inability of insurance to cover a significant liability at Monroe’s Trainer refinery; failure to comply with existing and future environmental regulations to which Monroe’s refinery operations are subject, including costs related to compliance with renewable fuel standard regulations; our ability to retain senior management and other key employees, and to maintain our company culture; significant damage to our reputation and brand, including from exposure to significant adverse publicity; the effects of terrorist attacks, geopolitical conflict or security events; competitive conditions in the airline industry; extended interruptions or disruptions in service at major airports at which we operate or significant problems associated with types of aircraft or engines we operate; the effects of extensive government regulation we are subject to; the impact of environmental regulation, including increased regulation to reduce emissions and other risks associated with climate change, on our business; and unfavorable economic or political conditions in the markets in which we operate or volatility in currency exchange rates.
Additional information concerning risks and uncertainties that could cause differences between actual results and forward-looking statements is contained in our Securities and Exchange Commission filings, including our Annual Report on Form 10-K for the fiscal year ended December 31, 2020 and our Quarterly Report for the quarterly period ended September 30, 2021. Caution should be taken not to place undue reliance on our forward-looking statements, which represent our views only as of the date of this story, and which we undertake no obligation to update except to the extent required by law.