What is Cargojet's One Fleet, One Network strategy and how does it improve profitability?

Cargojet's One Fleet, One Network approach integrates previously separate business lines: domestic express, dedicated contract flying, and charter operations. Rather than managing these independently, the company now centrally manages aircraft, network capacity, and commercial sales. This allows better matching of capacity to customer demand, improved aircraft productivity, and deployment of available capacity to the highest-value opportunities. The result: 13.3% increase in block hours per aircraft and 31.5% margin growth in Q3.

How is Cargojet offsetting the loss of UPS contract flying?

Cargojet has been flying Boeing 767 freighters on behalf of UPS following UPS's retirement of 27 MD-11 cargo jets. As UPS takes delivery of factory-built 767s from Boeing, this contract flying will largely end this quarter. However, Cargojet is offsetting this loss through new contractual flying to South America that has already begun, plus additional flying opportunities to China and the Far East currently under negotiation.

What is the significance of expanding Miami service to three times weekly?

The expanded Hamilton-to-Miami service (effective December 2) provides greater connectivity between Europe, Asia, Canada, and South American destinations. This gives freight forwarders more shipping options and flexibility while allowing Cargojet to better connect global markets through its Ontario hub. The expansion addresses increased demand from shippers attracted to more route options, and Cargojet has already secured volume commitments from existing customers ahead of the launch.

How are geopolitical disruptions affecting Cargojet's business?

Geopolitical disruptions have led businesses to divert cargo to air transport, particularly benefiting Cargojet's international flying for customers like DHL Express. This has contributed to strong international flying activity year-to-date. Additionally, the broader air cargo industry is experiencing favorable market conditions where capacity has not kept up with 6% volume growth, supporting higher yields across the sector.

What cost pressures is Cargojet facing from labor agreements?

Cargojet's new pilot contract calls for a 53% pay increase over four years, which took effect during Q3. The company has stated it will pass these cost increases onto customers. Management is increasingly focused on revenue quality and is willing to reprice contracts when they become eligible for adjustment, citing the company's high on-time performance and service quality as justification for premium pricing.

Shipping & Freight

High Impact

Cargojet records Q3 revenue record with fleet integration strategy

Nov 13, 2026

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The signal

Cargojet achieved record third-quarter revenue of $201.4 million (up 30.3% year over year) by implementing its One Fleet, One Network strategy, which integrates domestic overnight operations with international charter services and dedicated customer flying. The company improved aircraft utilization by 13.3% in block hours per aircraft, translating to 31.5% profit margin increases.

This restructuring mirrors industry trends seen at FedEx, where carriers are consolidating previously separate business units to maximize asset efficiency and respond to favorable cargo market conditions. Cargojet is expanding its Miami service to three times weekly effective December 2, while simultaneously managing the wind-down of UPS contract flying with offsets through South American and Far East opportunities.

The initiative demonstrates how mid-tier carriers are responding to global capacity constraints and shipper demand for greater route flexibility.

Companies affected by this story:

FedEx

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UPS

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Dematic

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#air-cargo-optimization

#fleet-utilization

#network-restructuring

#scheduled-charter-services

#cargojet-earnings

#cargo-capacity

#supply-chain-efficiency

#international-logistics

#freight-forwarders

Frequently Asked Questions

What This Means for Your Supply Chain

Simulation Suggestion

immediate

What if UPS contract flying represents 15% of Cargojet's capacity and new South America routes secure only 60% of that volume?

Model the impact of UPS contract flying ending this quarter, representing 15% of current Cargojet capacity. Assume new South America and China/Far East contracts offset only 60% of this volume. Calculate the capacity utilization impact, revenue loss, and potential service level effects on remaining customers through Q4 and Q1.

Run this scenario

Simulation Suggestion

this month

What if pilot wage costs increase faster than Cargojet can pass to customers through repricing?

Model a scenario where pilot labor costs increase 53% over four years as contractually committed, but only 70% of the cost increase can be passed to customers due to competitive pressure and contract repricing limitations. Assess margin compression, pricing power, and potential service level changes needed to maintain profitability.

Run this scenario

Simulation Suggestion

strategic

What if expanded Miami service attracts sufficient volume to require additional aircraft?

Model the scenario where the expanded Hamilton-Miami service (three times weekly starting December 2) attracts more demand than current fleet capacity supports. Estimate aircraft utilization needs, potential charter revenue uplift, and the requirement for additional leased or owned aircraft. Assess impact on operating margins and cash flow.

Run this scenario

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