The grounding of MD-11 aircraft after a deadly crash of a UPS plane could boost air cargo rates during the holiday season, with some capacity out of the market, but analysts aren’t expecting a big impact. The FAA prohibited flights of MD-11 planes following the crash, leading to a rise in air freight rates.

The TAC Index reported a 4% increase in the Baltic Air Freight Index in the week ended Nov. 17, with rates up 2.4% compared to the same period last year. UPS and FedEx grounded their MD-11 aircraft, making up 9% and 5% of their fleets. FedEx is working with the FAA to ensure its jets meet standards.

UPS and FedEx have contingency plans in place to continue service after the crash. UPS has not added peak season surcharges due to the grounding of its MD-11s but has secured additional aircraft and consolidated flight routes. CEO Carol Tomé expects a surge in volume during the peak season.

Stifel predicts minimal operational and financial impact from the grounding, as aircraft will resume flying once approved individually. Air cargo volumes in October rose 4% year-over-year, with cargo supply growing 3% in the past four weeks. The NTSB found evidence of fatigue cracks and overstress failure in the crashed jet.

The crash occurred during the government shutdown, leading to disruptions in air travel. Treasury Secretary Scott Bessent warned of potential shortages around the holidays due to cargo slowdowns. The shutdown has ended, and air travel disruptions have largely dissipated. UPS is headquartered in Atlanta, with its largest facility in Louisville.

Read more at CNBC: Shipping impact from plane grounding after UPS crash seen as ‘minimal’