Page 14 - AAA JANUARY-MARCH 2021 Online Magazine

Aviation has ordered two Airbus SE A330 conversions from ST
Engineering’s EFW joint venture with Airbus. Major P2F conversion
companies such as ST Engineering, Israel Aerospace Industries
(IAI) and Aeronautical Engineers Inc., find themselves busier than
they have ever been.

Making Change Permanent
The “preighter,” a passenger aircraft carrying goods strapped
to seats or with interior stripped, was the industry’s immediate
response to the spike in cargo demand during the peak of the
COVID-19 crisis, but an increasing number of carriers have decided
that making the conversions permanent would be a good business
ing for about 11%. strategy. According to a study, 782 P2F conversions are likely to
According to aviation analytics firm Cirium, the take place from 2021-2030, with Boeing 737 NG expected to be
number of P2F conversions globally will rise the most converted type with over 200 units. The majority of the
by 36% from 2020 to 90 planes this year, and aircraft for P2F conversions will be between 17-25 years of age.
to 109 planes in 2022. Demand is growing for
newer-generation programs such as the 737- According to Boeing’s Biennial World Air Cargo Forecast in
800, A321 and the A330, but older types like November last year, the air freighter fleet will grow to more than
the 767 still remain popular. 3000 units by 2039, at a 4.0% revenue ton kilometer annual growth
rate. From 2020 to 2039, carriers will add 2,430 additional freight-
“We think the 767 has been a very versatile ers, 930 of them new-build widebodies such as the 747-8F, 767F
freighter,” says Brady Templeton, president and 777F. The rest P2F conversions of the deliveries and more
of Cargo Aircraft Management, Air Transport than 60% will be passenger-to-freighter (P2F) conversions with
Services Group (ATSG). “It continues to be a 72% of them being narrowbodies.
dominant asset un the mid-size freighter market.
Since the pandemic, we have seen significant According to IATA, air cargo volume will increase 13% in 2021
interest in the aircraft, not just domestically.” while airlines will generate one-third of their revenue from cargo,
compared to just 12% in 2019. The shift to cargo is reflected in the
Sensing an Opening 2020 figures as well. The list of top ten airlines by operating reve-
Many companies that were focused on pas- nue , usually dominated by passenger airlines, saw FedEx jumping
senger aircraft MRO before COVID-19 are from fifth place in 2019 to first place. Spurred by the revival of the
now looking to enter the P2F market, says domestic passenger traffic, China Southern jumped from seventh
Templeton. Much of the interest he adds, is spot to second. Delta, which was first on the list in 2019, stood fifth.
coming from Asia and Eastern Europe. “The
P2F conversion business is very different Hectic Activity
from maintenance of aircraft. That is certainly With the demand for air cargo set to further grow, airlines have
something that we will have to consider if we been busy acquiring new aircraft to meet the demand. UPS Airlines,
are working with companies that are new in which added a 747 and a 767 to its fleet last year, is set to expand
the field. Certainly, there will be a significant its fleet by adding 12 widebodies this year. ATSG’s subsidiary,
amount of oversight.” Cargo Aircraft Management, Inc., has purchased two Boeing 767-
300ER aircraft from Air Canada for P2F conversion and will lease
The ongoing pandemic has negatively impacted
the quality of work of the MRO industry, says
Walton. “After the initial lockdown, a lot of expe-
rienced people retired. A lot of talent left the
industry. Even after many of the companies
resumed work, they allowed the older work-
ers to stay home. We have seen some quality
issues from vendors that we have not seen
before.”
With airlines resigned to the fact that pre-
COVID-19 belly-hold capacity will take years
to come back, the list of airlines going the P2F
route is growing. Air Canada is looking to con-
vert several of its Boeing Co 767s, Russia’s S7
Group is acquiring its first 737-800 converted
freighters from lessor GECAS, and lessor CDB

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