Purolator and Canada Post, part of a conglomeration known as the Canada Post Group of Companies (CPGOC), have announced an early extension to a 2014 air cargo contract with Cargojet, now running through 2025, that outlines the cargo carrier’s service obligations to the Canadian shipping company, in the context of growing e-commerce volumes and other market changes.
The terms of the original 2014 deal tasked Cargojet with providing comprehensive Canada-wide air cargo services for CPGOC, including running subsidiary Purolator’s national air cargo network. Cargojet’s domestic overnight network also expanded to handle the additional volumes and provide a “virtual dedicated air cargo network to the Canada Post Group of Companies.”
When first concluded, the projected revenues were estimated at be approximately C$1billion dollars during the initial seven-year agreement, based on projected volumes.
“The business environment is changing rapidly, especially with the growth of e-commerce,” said Ajay Virmani president and CEO of Cargojet. He also noted that this early extension was also “a testament to the confidence that CPGOC has in Cargojet’s team’s capabilities and further secures our longer-term commitment to providing a scalable and cost-effective service to our customers.”