Watch: What’s driving more carriers to medium-widebody freighters?

For the week ended April 4, Cargo Facts reported new conversion orders and operator interest in medium-widebody freighters from three carriers , highlighting the relentless demand for the 50-60 tonne freighters . A 767-300 conversion or der from Ethiopian Airlines and interest in the type from CargoLogicAir (CLA) reveals how the size category that has long been popular in express and e-commerce networks is inc reasingly becoming popular with combination carriers. In this Cargo Facts Weekly Wrap , Charles Kauffman and Jeff Lee examine these developments by discussing why 767s make sense for CLA and the peculiarities of the Ethiopian deal. They then turn to MNG’s move away from production A330s before looking at the week ahead. A transcript is available below. This transcript has been generated by software and is being presented as is. Some transcription errors may remain. Charles Kauffman Hi everyone and welcome to this episode of cargo facts connect the newsletter of record for the air cargo and freighter aircraft industries for over 40 years. I'm Charles Kauffman, Senior Editor of cargo facts. And this is our weekly wrap for what's happening in industry for the week that ended April 4. And before we begin, I'd like to thank our sponsors and advertisers 321 precision conversions and Kra international AI c cubed aerospace, Fw ELD, rentals, calm and IPR conversions. I'm pleased to be joined today by Jeff Lee. Hi, Jeff Charles Kauffman It is April 5 2021. And the through line running through many of our stories this past week was that the market for medium wide body freighters is still on fire. Both Boeing and Israel Aerospace Industries have recently added conversion capacity. And still it is not possible to induct a 767 300 until well into 2022 unless a conversion slot has already been reserved. The size category isn't only popular with Express and within Express and e commerce networks to operators looking to add the 767 platform include all cargo carrier cargo logic, air and combination carrier Ethiopian Airlines. Just to recap a few stories from this past week published on cargo facts comm cargo logic air is looking to add up to four freighter converted 7673 hundreds over the next couple of years. Ethiopian Airlines plans to convert to have its own 767 300 yars and add the 767 freighter platform to its fleet of nine triple sevens and 37378 hundreds Turkish ACI and specialist carrier MMG airlines order to a 330 300 conversions with E Fw. And last but not least, we also found out that Amazon is going to place to have its own seven six sevens with Canada based cargo jet once those are read delivered as freighters later this year. So that does leave about seven more Amazon cmaj placements, most of those will be redelivered in 2022. And so we should find out more about where those are going as as the reed deliveries near and return to some of these headlines in a moment. But Jeff, what are some of the factors making medium wide bodies popular with a growing operator base? Jeff Lee I think it varies for different carriers. But I mean generally, especially these days, but I think we can say it's that 767 feedstock is is relatively cheap, if you can find them but I mean they're cheap and compared especially compared to new build 767 printers and and even triple seven freighters. I mean then they also have the right mix of range and payload performance. And you know, in some cases like CNA, for example, this is really interesting because they they obviously all sudden four seven operator right now and they we know that they had been looking to expand with more seven, four sevens. And that would be, I think their first choice. But given Brexit and given the difficulty in finding seven, four sevens, they are now looking at the 767 platform, which actually opens up, you know, more opportunities for them. Especially with e commerce traffic in Europe and transatlantic, and the transatlantic market, for example, and that putting the Sensex sevens on these planes would enable them to shift the 747 back to the Asia, Europe market, which they come in, they do want to expand in that market as well. With other carriers like Ethiopian, for example. They have just a small number 3767 300 is less than athlete. And we know that they want to expand their their choreography. And it's interesting, actually with the dukan because they they actually joined just a very small group of combination carriers with 767 300 phrases. Latin recently ordered up to eight more conversions, the largest operator of the sentence or budget combination carrier with 767. treaters, they already have 11. Ama has five is Pakistan airways has to and Asiana and Qantas and Royal Air maroc. Each one, Canada and Iceland and we know will be joining this group shortening. But if you would actually be the first one with an AI conversion, all of the others have either productions at certain places or the Boeing BCF version. Charles Kauffman That's an that's an interesting point. Why do you think Ethiopian is working with II instead of Boeing? Jeff Lee I mean, it is pretty interesting. I mean, given the relationship between Boeing and if you can, but maybe the timeline is a was a key consideration, because as you were saying, we know that slots are up, or, you know, pretty fully booked until next year. But and this is why it's also interesting that Ethiopian will be converting these these Sensex sevens at their own MRO facility and Adas. Now, we don't know whether this was because purely because of slot constraints, eyes, other facilities and Mexico and Tel Aviv. But, you know, we know that the first one will be inducted this year, later this year. And they will also be the first free to test to be converted in Africa at all. So it is interesting, and we all will have to see whether this means that I is opening a longer term conversion line in Africa, because we do know that the that facility is one of the largest in Africa. And there might be additional interest in freedom in wealth, yes. And freedom in that sense. It's sevens from the regions, other countries in the region. We know Astro, for example, likes having the 767 and might want to add more Charles Kauffman as that's a good point. And I guess in thinking about these these conversion orders, I'm reminded of of the the large volume of narrowbody conversion orders and transactions that we've reported on cargo facts in recent months. What would you say is different about you know, some of these these recent medium wide body conversion orders if we compare them to the narrowbody freighter conversion orders? Jeff Lee One point i guess is that less saws with the narrowbodies they were mostly if not all of them were involving the less saws either as opposed to the operators themselves. But with many of these widebody transactions, it's the the operators themselves or placing the order, which means that obviously, these conversions are less well, they're not speculative in nature, whereas the lessor was, we know that some of them already have customers lined up but others don't. And with these wide body orders, the carriers are they're aware of the fact that they have to wait and they don't mind having to wait, you know, one or two years. And I guess in this market, the boy the weights is worth it. their opinion and they would be white right, I guess. And looking at the a 330 for example, I mean, the MMG deal is pretty significant today, isn't it? Charles Kauffman Yeah, no definitely in the sense that you know, for for VFW, the the company converting the aircraft it does mark an additional order from from an operator. So, give admin G's is will be the latest operator to add the type. Their first aircraft a 14 year old a 330 300 has already been inducted for conversion. The order itself from MMG wasn't completely unexpected. The turkey based carrier operates a single a 330 200 production freighter, and for many years has had more on on order had three more on order, I believe, at least until December 2020. When this order disappeared from from airbases order order books, and here so at first it seemed like that that came as a blow to Airbus, but, you know, this is at least a conversion order for for there are affiliate Fw backing in 2019 I believe it was an mg who told us that you know, they were they were happy with the a 330 200 production freighter but you know, they they saw a lot of promise in the the freighter converted variant and that they were they working at Airbus are working with Airbus to to tweak that order. And it looks like they have reached an agreement and they're moving forward with the conversions instead. The carrier currently operates five a 300 600 freighters in addition to that a 330 200 production freighter so you know, to will not replace those on a one to one basis. So I wouldn't be surprised to see additional conversion orders. You know, of course, they could always lease in that capacity from some of the other less words that have entered the space not all conversion orders are currently accounted for. In terms of aware whether less words we'll place this aircraft upon redelivery. But yeah, it's it's, it's progress for for VFW and the a three a 330 300 conversion program. Looking ahead to next week, what's on tap for for this next week, Jeff? Jeff Lee I will continue to explore additional medium wide body transactions. And we'll also return to the the narrowbody space with potentially a few new orders and significant transactions involving narrowbody freighters. Charles Kauffman That is certainly true. Well, that does it for for today. Quite a few interesting stories this week. To those of you joining us on this edition of the weekly wrap. Thank you. For more multimedia content like this. Check out cargo facts calm and also search card effects connect on iTunes and Spotify or wherever you find your podcasts. Thank you Jeff. Subscribe to Cargo Facts Connect on iTunes or Spotify , or download the episode on Transistor . Cargo Facts Asia, taking place April 20-21 as a virtual experience, is the event for exploring opportunity in the Asia-Pacific region. The event continues to bring together the best, brightest, and most innovative executives in the global air cargo industry. Learn more and register at www.cargofactsasia.com .

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