Will aircraft find homes amid a growing backlog of 737-800 conversions?

Just over four years after the first converted 737-800 (MSN 32740) entered service, we now have 101 737-800Fs in service across the globe and an additional forty aircraft in various stages of conversion. The 737-800F has been strong competition for its predecessor, the 737-400F, with an additional container position as well as an extra 4,800 to 5,900 lbs of payload. The -800 also features technological upgrades as well as improvements in fuel consumption over the -400. The following interactive display contains four pages with a panel in each: 737-800 conversions by STC (converted and in conversion) Yearly completed conversion by STC Total aircraft by owner Status of orders by owner There are three STCs certified for the -800 conversion: Boeing (-800BCF), AEI (-800SF) and IAI (-800BDSF). Boeing has dominated the market with seventy-four aircraft converted and an additional twenty-one aircraft in conversion at the time of writing, followed by AEI (twenty-one with an additional sixteen in conversion) and IAI (six with an additional three in conversion). Boeing being the OEM had the definite advantage of not being required to certify an STC. AEI's 737-800SF STC recently gained Transport Canada approval, joining the Federal Aviation Administration (FAA), Civil Aviation Administration of China (CAAC) and European Union Aviation Safety Agency (EASA). However, as reported by Cargo Facts , AEI has its sights set on approvals in the U.K., Brazil, Malaysia and Indonesia. IAI's STC for the 737-800BDSF has only been approved by the FAA and the Civil Aviation Authority of Israel (CAAI). There has also been a rapid expansion during the last year in the number of designated conversion houses with all three STC holders adding licensed conversion facilities. For more information about the existing and future conversion houses, we recommend that you explore our Conversion House Dashboard . After AerCap's acquisition of GE Capital Aviation Services (GECAS), the lessor solidified its position as the top owner with 55 Boeing 737-800Fs, nine of which are still in conversion and an additional five aircraft on order. In a distant second, ASL Aviation Holdings owns twelve aircraft, one of which is currently in conversion. BBAM currently has two aircraft that have just entered service after conversion with an additional eight aircraft in conversion. Another interesting development is we recently saw Copa Airlines convert one of their passenger aircraft (MSN 33709) to a freighter configuration. WestJet recently announced that it will take delivery of four -800BCFs; some have speculated that the feedstock for these conversions could come from existing WestJet aircraft. We do not believe this is the case as all Westjet 737-800s are flying. 737-800 conversions have amassed well over 250 orders, with a current backlog hovering around 120 aircraft. We attribute GECAS' order to AerCap in the diagram above. It should also be noted that we see aircraft completed and in conversion owned by ICBC Financial Leasing and BoComm Leasing but have not been able to confirm an official order. It should also be noted that there is an order for four -800BCF aircraft to an unnamed lessor that we speculate may be associated with Westjet. The future of -800 conversions We feel that the rapid addition of conversion lines and narrowbody capacity is both unprecedented and unsustainable. At the time of writing, it appears that all conversions are entering straight into service with operators, but we question how long demand will outpace supply. Our 2021 freighter forecast is calling for 1,137 narrowbody freighter conversions over the next 20 years or approximately fifty-seven units per year. Based on existing conversion capacity we saw forty-eight -800 conversions across the three STCs in 2021, up from twenty-six conversions the previous year. With the recent addition of conversion capacity, we believe that we will see upwards of sixty -800 conversions in 2022. Factor in increased competition from the 320 and 321 programs, as well as the more affordable -400 program, and we have a recipe for a plateau in demand. COVID has had unforeseen impacts on the aviation market. One key driver of the recent freighter demand has been the lack of belly capacity, as we recently reported capacity in both the Trans-Pacific and Trans-Atlantic markets is on the rise, we expect a similar trend intra-Europe, Intra-Asia and U.S. Domestic markets that the -800Fs are currently thriving in. This surge in conversion demand will likely be short-lived, but we are glad to see the conversion houses are making the best of it while they can.

Will aircraft find homes amid a growing backlog of 737-800 conversions?

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