Volga-Dnepr freezes Boeing freighter operations over Russia sanctions

Russia’s largest cargo airline, Volga-Dnepr Group, has shut down its two airline subsidiaries that rely on Boeing aircraft because of Western sanctions. The move eliminates an important source of cargo aircraft from the market when cargo shipping capacity is in short supply because the pandemic continues to limit international passenger flights.

Moscow-based Volga-Dnepr said Friday it has suspended operations at AirBridgeCargo and Atran Airlines and furloughed some office staff because of sanctions related to leased aircraft and the Bermuda Civil Aviation Authority’s recent decision to revoke airworthiness certificates for Russian-operated aircraft. Ireland has also suspended the airworthiness certificates of aircraft operating in Russia because it can no longer verify their safety.

Scheduled airline AirBridgeCargo (ABC) has 17 Boeing 747 freighters, including 13 late-model 747-8s with a payload capacity of up to 139 tons, plus a Boeing 777. Subsidiary Atran Airlines handles regional flights to Europe and Asia with four Boeing 737-400 and two 737-800 narrowbody aircraft.

Leasing companies have until March 28 to repossess aircraft from Russian customers under European Union sanctions imposed early this month to punish the government of Vladimir Putin for invading Ukraine. The mechanics of doing that under such short notice are proving extremely difficult and aviation experts doubt many of the planes will be returned anytime soon. 

Bank of China Aviation filed suit March 14 in the U.S. District Court for the Southern District of New York against ABC for breach of contract over a leased 747-8 jet. Cargo Facts first reported the lawsuit.

U.S. and European sanctions also ban Russian aircraft from their airspace, and the transfer of parts and technology necessary to maintain aircraft from Boeing (NYSE: BA), Airbus and other manufacturers. The U.S. Department of Commerce on Friday warned companies around the world from providing any kind of assistance, such as refueling and navigation aid, to any Russian aircraft subject to U.S. export controls.

“Volga-Dnepr’s management is working together with its partners and regulators to find possible solutions under the current situation,” the privately held company said in a statement.

The Volga-Dnepr Group “played a vital role in the global economy and logistics,” said Stan Wraight, the CEO of Strategic Aviation Solutions International who led the team that founded AirBridgeCargo in 2003. 

He lamented the fact that private carriers in Russia, such as Volga-Dnepr and S7, and thousands of employees “have to pay the consequences simply because they are Russian, not because they are supporting the government.” 

“It seems common sense has been thrown out as domestic nationalism seems to overtake economics and humanity. I know most of the people involved personally, and I hope I am not the only one who understands the difference between state-sponsored companies and private ones and doesn’t support discriminating against all people under the same banner because of the passport they hold.” 

Volga-Dnepr Airlines continues to operate its fleet of An-124-100 and Ilyushin-76 extra-large freighters. The planes historically have served shippers with project cargoes such as turbines, mining equipment and trucks, but also are hired to carry big loads of general cargo. 

Volga-Dnepr likely will have difficulty sustaining business for its homemade aircraft because it can’t fly to the two largest markets in the world, the sanctions have cut Russian banks’ access to a secure messaging system Volga-Dnepr uses to collect payments and many customers are voluntarily stopping business with Russian companies to avoid bad publicity or running afoul of complex sanctions by mistake.

Volga-Dnepr said it is trying to broker shipments with other transport providers across all modes — air, ocean, truck and rail — as an alternative for moving customers’ goods.

Click here for more FreightWaves/American Shipper stories by Eric Kulisch.

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Editor: Eric Kulisch, Supply Chain and Air Cargo Editor