Flight cuts amid shutdown could threaten supply chain, holiday deliveries

The Federal Aviation Administration’s reduction in flight capacity could strain the supply chain and package shipping as the holiday season approaches. 

Here’s what to know, and what some experts are saying: 

Flight cancellations

The backstory:

The FAA announced a 10% reduction in flight capacity across 40 major U.S. airports last week to help relieve the pressure and workload on FAA employees who aren’t getting paid amid the shutdown, which has become the longest in U.S. history. 

Big picture view:

A reduction in flight capacity could strain air cargo as the holiday season approaches. FedEx and UPS have major hubs at affected airports, including Indianapolis, Memphis, and Louisville. 

RELATED: FAA reduces air traffic by 10% at 40 airports - See the list

MD-11 planes grounded 

Dig deeper:

Additionally, UPS and FedEx have grounded their fleets of McDonnell Douglas MD-11 cargo planes "out of an abundance of caution" following last week’s major air crash in Kentucky. 

Why it matters:

MD-11 aircrafts make up about 9% of of the UPS fleet and 4% of the FedEx fleet, the companies said.

RELATED: MD-11 planes grounded by UPS, FedEx after Kentucky crash

Supply chain concerns

Big picture view:

Supply chain concerns are now stemming from those two issues: the FAA’s flight reductions and the grounding of MD-11s. Here’s how each of those could play a role. 

Flight reductions:

The FAA order did not address cargo flights specifically, but directed air carriers at 40 airports to reduce their total daily scheduled domestic operations between 6 a.m. and 10 p.m. local time at each airport by 10%. Air freight is carried not only on cargo planes, but also in the bellies of passenger aircraft.

Both FedEx and UPS said many of their flights take place at night, outside the restricted window. Both also said they had contingency plans to protect shipments of critical items like pharmaceuticals, medical devices and essential manufacturing goods.

Dig deeper:

Also, most air freight is international. The reduction in flights so far is only on domestic air travel, not global flights. Airlines transport about 35% of global trade by value but only about 1% of world trade by volume, according to the trade group International Air Transport Association.

Planes grounded:

Separately, UPS noted that contingency plans are in place to ensure reliable service after the grounding of the MD-11s.

Bottom line:

Most air shipping is international, and so far unaffected. And trucks are expected to keep supplies moving in the U.S. 

RELATED: How the government shutdown will affect international flights

Holiday shipping delays

Big picture view:

Logistics companies say consumers shouldn't expect delays on their packages due to the reduction in flights — for now. The impact should be manageable unless reductions deepen.

The other side:

Patrick Penfield, a supply-chain management professor at Syracuse University, called the 10% reduction in flight capacity and the grounding of the MD-11 planes a "one-two punch" for cargo carriers and shoppers.

"This is such a stressful time for both companies, and you’ve got this surge in demand and then you just lost some of your capacity," Penfield said. "So they’re already scrambling as it is during the holiday season, and they’re going to scramble even more."

What they're saying:

He estimated that during the mid-December time frame, when shipping is at its peak, shoppers could see delays in deliveries by a day or two if flight reductions have continued and the MD-11s aren’t back in use. He recommends ordering holiday gifts early.

Will more flights be canceled? 

What's next:

Tuesday, Nov. 11, will be a telling day for air travel amid the shutdown. It’s the next and second payday that FAA employees would miss, and Transportation Secretary Sean Duffy said an increase in flight cuts could then be coming.