New ACMI-deals highlight growing demand for 747Fs

This month, Atlas Air Worldwide (AAWW) will begin operating a 747-400F on an ACMI basis for Deutsche Post DHL Group’s forwarding subsidiary, DHL Global Forwardin. Separately, Orlando-based National Airlines announced it had placed two 747-400Fs with China-based BST Logistics. Do these deals sound familiar? They should. Atlas has recently inked ACMI/CMI deals for 747F assets with a wide variety of airlines active in Asia, such as Asiana, Cathay Pacific, Hong Kong Air Cargo, Nippon Cargo Airlines and Suparna. If Amazon’s Prime Air made 2016 the year of the 767F, perhaps 2017 will be remembered as the year the 747-400F made its resurgence.

Returning to DHL-GF’s new service, the thrice-weekly “round-the-world” service will connect multiple cities in Asia, Europe and North America; with Brussels (BRU) and Shanghai Pudong (PVG) as the key points. According to sources familiar with DHL Global Forwarding’s “in-house carrier and charter broker”, StarBroker, twice-per-week outbound flights will stop in Oslo (OSL) before traveling onward to Shanghai Pudong via Seoul (ICN), while one flight per week will travel directly to PVG. Inbound flights return to Brussels via Cincinnati/Northern Kentucky (CVG) and Zhengzhou (CGO).

The service is part of the recently announced Norwegian seafood charters supported by Norway’s Ministry of Transport and Communications, which aims to boost the nation’s seafood exports from Oslo. This is the second seafood-focused cargo route DHL has launched this year. Earlier this year, DHL connected Lakselv (LKL), in Norway’s far north, to Oslo. The Atlas-operated flights to ICN and PVG are an extension of this service.

Although Atlas-affiliate airlines have a long-standing relationship with DP-DHL subsidiary, DHL Express, this is the first known ACMI-deal directly with DHL Global Forwarding. The new service comes shortly after Shanghai-based Suparna Airlines made Frankfurt Hahn Airport its main European gateway. (It should be noted, that Suparna’s parent company, HNA Group, owns a majority equity stake in Hahn Airport.) Cargo Facts believes the new Atlas flights will largely replace block space agreements StarBroker previously held on the five-times weekly Suparna flights.

In related ACMI news, a previously existing charter agreement between China-based BST Logistics and National Airlines has evolved into an ACMI agreement. National currently has two 747-400Fs in round-the-world service on behalf of the forwarder and its partners, which include Navitrans, and China Aerospace International Holdings.  This deal resembles an expired agreement reached between Atlas and BST/Navitrans back in 2013 for the ACMI-lease of two 747-8Fs. Atlas’ 747-8Fs have since been repositioned with other customers, and it appears that National Airlines will largely continue this service with the ACMI-leased -400Fs.

Given the recent surge in demand for air cargo, and the surge in ACMI deals, it’s no surprise that all-cargo operators including Atlas Air Worldwide Holdings and Cargolux are adding freighters. AAWW recently acquired a 747-400ERF (33515) on lease from Altavair. The freighter was originally delivered to Korean Air in 2003, and has been operated by Korean until now. Altavair acquired it, along with a sister ship, in a forward sale late last year. The second of the pair (33517) will also be leased to Atlas when it leaves Korean’s fleet in the near future.

Similarly, Luxembourg-based Cargolux acquired a 747-400F (30805) on lease from Boeing Capital (BCC). The freighter was originally delivered to Cathay Pacific in 2001, and was acquired by BCC in a forward sale in 2014. It has been in storage at Victorville (VCV) since July 2016, when Cathay handed it over to BCC. This brings Cargolux’s freighter fleet to twenty-three units, including fourteen 747-8Fs, two 747-400ERFs, and seven 747-400Fs. In addition, Milan-based subsidiary carrier Cargolux Italia operates four 747-400Fs.

Up to a point, Atlas and other carriers can meet increasing demand by reactivating parked 747-400Fs/ERFs, but the real issue here is the future of the very large freighter. The 747-8F is the only noseloading freighter currently in production, and its 140-tonne payload is almost 30% greater than the 109 tonnes available in a 777F. But Boeing’s 747-8F backlog is now down to 16 firm orders.  If new 747-8 orders do not start appearing very soon, what happens to the 747-production line? Do shippers, forwarders, charter brokers, lessors, and airlines really want to live in a world in which there are no nose-loading freighters and nothing with a capacity of more than 109 tonnes? Or are fresh orders for -8F production freighters on the horizon?

Those interested in learning more about the future of freighters should join us at Cargo Facts Symposium in Miami, 2-4 October, where Atlas CEO Bill Flynn will join us in an informative Fireside Chat.  To register, or for more information, go to CargoFactsSymposium.com.