Ecommerce growth has increased the demand for conversion of passenger service aircraft into cargo aircraft to the point of being an issue for global airplane fleet. One of the most popular one, the Boeing 737, faces a surge of demand because low oil prices encourages passenger company to hold on to their plane longer before selling them to freight companies.
Carriers (or internet sales giants) looking to turn Boeing 737s into cargo aircraft are facing a veritable obstacle course. Not only are conversion slots booked solid beyond 2016, but feedstock is proving harder to find than anticipated, as passenger airlines are holding onto their 737-400s.
Pemco World Air Services, one of the leading players in the 737 freighter conversion arena, has had to push some conversions back owing to the tight feedstock situation.
“Fleet availability is an issue because fuel is so cheap. Passenger airlines are keeping the Classics a little longer,” Pastor Lopez, CEO of Pemco World Air Services, said. “A lot of people have extended the lease of aircraft.”
Bob Convey, Vice President of Sales and Marketing at Aeronautical Engineers Inc (AEI), believes low fuel prices may have repercussions for the next generation of 737s (NGs) to be turned into all-cargo configuration. “I think oil will keep [737 airplanes] in passenger service longer and keep their prices higher,” he said.
Both AEI and Pemco have launched programmes to convert 737NGs into freighters.
Demand for narrowbody freighters is expected to remain strong. Boeing projects a need for more than 1,000 converted freighters the size of the 737 over the next 20 years, with China’s domestic carriers accounting for nearly one-third of the total market.
Somewhat ironically, it is China which may bring a bit of relief to the issue for global airplane fleet of 737.
Given age limits on freighters imposed by the country’s aviation authority, China’s appetite for 737-400 cargo aircraft has slowed markedly, Mr Convey said, adding that most converted 737 freighters are delivered to European or North American operators.
A version of this appeared in The LoadStar on July 8. Read the full article here.