Listen: More orders and commitments for 777 and A350 freighters

It’s been a month and a half since Boeing announced the 777-8F with launch customer Qatar Airways . Since then, both Airbus and Boeing have announced additional deals for their respective next-generation widebody freighter programs. Boeing landed a commitment from Ethiopian for five 777-8Fs , while Etihad became the fifth known customer to commit to the new A350F . In this episode of “Cargo Facts Connect,” Cargo Facts Deputy Editor Jeff Lee and Associate Editor Andrew Crider are joined by Jim Edgar, senior consultant with Cargo Facts Consulting, to continue a discussion on the competition brewing between the A350F and the 777-8F. A transcript is available below. This transcript has been generated by software and is being presented as is. Some transcription errors may remain. Andrew Crider Hello and welcome to this episode of cargo facts connect the podcast of cargo facts, the newsletter of record for the air cargo and freighter aircraft industries for over 40 years. I'm your host Andrew Crider, associate editor of cargo facts. Jeff Lee And I'm Jeff Lee, deputy editor. Joining us today to continue our discussion on the large wide body segment is Jim Edgar, Senior Consultant of cargo facts consulting. Welcome back, Jim. Jim Edgar Thank you, Jeff, and Andrew. Pleasure. Jeff Lee So we've seen a few more deals involving the next generation of large wide body freighters since we last talked, and that includes both production features and conversions. Andrew Crider That's right, Jeff, we had Etihad with its MOU for 7 A350s Ethiopians MOU for five, triple seven, eight F's and cargo jet signing up for two more triple seven 200 LRS. And four more 300 Er conversions, presumably done with mammoth? Then there's also EVA plans to convert three triple seven 300ERs with IAI. Jim, what do you make of this set of orders and commitments? These are all major cargo players. Jim Edgar Yeah, I think it obviously reflects diversity of approaches by operators. I'm not completely surprised at the EVA decision, because if you recall, when they had production 747 400 F's they also opted for conversions for IAI. So they got a handful of BDSF. So they've been this route before. And obviously the dash 300 Er, converted freighter is very capable. But at a high level, I think it gets a little tricky in differentiating between firm orders and Mo use and options and, but by my count, I'm showing now the triple seven, eight F with about 39 orders of some type from two operators, and the A 350. F with 29 orders from five operators, or customers. So the gap is closing a little bit. But obviously with the Etihad order for seven, followed by the 7 A350 F's followed by the Ethiopian order for five, the gap closes a little bit between the total mou orders between the dash eight F and the A 350 F. Jeff Lee And I was gonna say with Etihad, it's interesting because they have in the past few years, they've downsized their freighter fleet haven't they and now they only have five triple sevens. So with these new, if they fill up the order, with these 7 A350 F's coming in, we'll see them expanding their freight operations again, we don't know for sure that they are getting rid of the triple sevens. But in any case, the 7 350s will give them some some growth. And with Ethiopian. I think that's also interesting, because they're obviously the largest fleet operator in Africa, but and they've nine. But I wouldn't be surprised if they take a hard look, they are taking a hard look. And they might commit to the 350 freighter as well, given that they have the 350 on their passenger side, too. So it's it's yeah, this is a very interesting set of potential customers for these new types. And with cargo jet. It's going to be their entry into large wide bodies. And it sounds like they've got from very ambitious plans for that platform. And more growth on the international stage as well. So it's all very, very exciting. But looking at the operators with a 350F commitments now, with Air France and Etihad, both being existing triple seven F uses. CMA CGM will interestingly have both the triple seven F's and the 350 F. And Singapore Airlines is replacing its 747 400 F's with the a 350. So, you know, how important do you think it is that the 350 has already been in passenger operations for several years now with with many of these operators? Jim Edgar Well, I think it's an it's obviously an interesting and, from my experience a little bit of an unusual situation in that during my tenure, Boeing was the one with the it was developing a freighter, a large wide body freighter after the passenger version had been in service for a while so of course, we attempted to leverage that because of the the success of the passenger version. Certainly the A 350 passenger plane has been widely accepted and has experienced a lot of success. But you know, the in airlines familiarity and knowledge with an airplane counts for a lot. It's in service, it's a known quantity there. The crews are familiar the ground equipment, all those types of situations lends to confidence of the operator in the airframe. And again, that was a situation that Boeing enjoyed previously, and I think to their advantage. However, combination carriers are particular you mentioned Ethiopian, that they have a 350s in service yet they've ordered the triple seven dash eight F. But combination carriers generally look at similar airframe types to simplify crew assignments and parts and all that all those issues that are so important to the success of freighter operation. But I should mention with that comment that two carriers leading carriers, in particular, Lufthansa and Cathay Pacific in the past, have chosen unique airplane types for their freighter fleet. In cafe's situation, it was the the 747 dash eight F that was unique to their fleet, but they chose it as their intercontinental freighter. And in Lufthansa's situation, it was both the MD 11 F, as well as the triple seven F, neither of which they had in their passenger fleet. So with all of the advantages in having a passenger airplane type in service and the proven aspects of it, there are combination carriers leading combination carriers that have made the decision to have a unique, large freighter type in their fleet and with some success, so it's a very interesting situation, it counts for a lot. I can't deny that. But it's not the end of the decision either. It's not necessarily a slam dunk if you have a successful passenger aircraft in your fleet, and you've got a choice of freighter types that you'll necessarily revert to that particular model. Andrew Crider At the same time, Boeing is continuing to bring in orders for the current triple seven from both existing and new customers. Western global whose fleet really excites me they have a large quantity of MD 11s that they're still operating they also have 3 747 400 freighters, but they have new triple sevens two firm and one option, DHL has acquired six more triple sevens and will eventually have 28 in total. And there's this unidentified order for five more Do you have any idea? Who might that customer be? Jim Edgar I really don't, but I can offer some thoughts on your comment regarding continued popularity of existing triple seven Fs. When you consider that at this point, it looks like the A 350, F will be in service in 2025. And the triple seven, eight F likely in 2027. There's a there's a timing gap, the markets growing, expanding, certainly more quickly than the passenger. But it's, it's got good strong growth at the moment. And there's a dearth of lift. And so there's a timing issue for those that want to expand and take advantage of the opportunities. And my recollection was, even in working with large airline customers regarding the triple seven F and the 478. F, in that interim of several years trying to develop the airplane and launch it even after both of them were launched. We still Boeing still sold a couple dozen, four, seven, Dash 400 apps. So when there's a need for lift, the markets stronger. And the lead times still a ways out there. There's opportunities and the triple seven F has certainly proven itself as a good solid, large freighter, very economical, very capable. And I have no first hand knowledge, but my guess would be that Boeing has to look at a bridge situation between the existing triple seven line and the triple seven de shade and nine. And thus, there's going to be opportunities and deals to fill that bridge lift. So they've got a good product, the original triple seven F and there are carriers that need the lift, that take advantage of market opportunities. So I'm not real surprised at at carriers that are placing orders that have had very good experience and have a need for newer airplane types before 2025 and 2027. With that said, too, there's also slots that present problems. So just because the as an example, the a three, a 350 will be available in 2025. There's also passenger aircraft that are being produced as well. So you have to find the right slots in terms of timing for customers that want the freighters. So it doesn't mean that you have unlimited slots available once the aircraft is in service. So there's a lot of considerations there. But it's not a real surprise that there'll be continuing sales of triple seven s before both the A 350 and the triple seven, eight F come into service. Jeff Lee Right? It's pretty interesting, because now that we know the timeline for that, we basically have a finite number of slots that Boeing has for the current triple seven f this is partly why we see new customers like Western global coming in. And I'm sure like you said Boeing is keen to sell more of those to bridge the gap between this and the triple seven data app. So we're looking forward to seeing who else comes in with triple seven actual orders. And we're also looking forward to seeing if any of these unidentified orders are on new operators of the triple seven, seven F. But speaking of the triple seven F and compare on that, but the D 350. How would you kind of compare the influence of the existing triple seven F's legacy with the reputation that the A 350 is has already earned as a passenger aircraft when we're talking about the next generation of freighters. Jim Edgar I think generally Both aircraft both the triple seven, eight F and the A 350. F are very, very comparable. There's some differences depending on assumptions that you make. But I have to say, I would guess from Boeing standpoint, they're viewing the A 350 F is very formidable competition. And thus, it, it's, it really is going to depend the success of each aircraft on a whole variety of factors because the sales decision, or the purchase decision by freighter operators is so variable, there's so many different criteria. Besides just comparison, analytics cost capability, there's a there situational, where do you where do you need to fly those aircraft? What's your present fleet? What's your passenger fleet for those combination carriers that want more commonality? What are the corporate priorities of the timing, you know, the 350 F has a two year advantage nominally over the triple seven, eight F. Obviously, at the end of the day, the deal and other deals, what's going on in the passenger side, lots of times, carriers will want to package a freight or deal with a passenger deal. So there's so many different factors. But the bottom line is that both the triple seven, eight F and the A 350 F are very, very comparable. And I have to say that Airbus obviously has put a lot of resources and capability into the into the aircraft. Crawford Hamilton's presentation at cargo facts symposium last fall was very indicative of that. And it's obvious that Airbus is paying attention to cargo and freighters and again, are going to be very, very formidable. So Boeing has a an unexcelled and an unequal legacy in freighters and cargo going back to their founding when they began with a male plane in 1916. But Airbus obviously has been in the business since the A 300. Conversion way back when, and has learned a lot from their experience both with the three ATF which ultimately never came about, but also the A 330. Production and conversion. So they're both very, very comparable. And it just really depends on what's most important where you put your priority and the the assumptions made and the corporate considerations. Andrew Crider So we're comparing the a 350 and then triple seven, eight F. I guess I'm curious to see when will we really know who is winning the competition for the for the freighters? Jim Edgar Well, it's obviously an ongoing situation. And as you mentioned at the to introduce this podcast, a lots happened just in the month since we did the last podcast, both on production, large wide body production, freighters as well as the worthy converted candidates also. So it it's kind of a work in progress. There's no final, you know, determination. But obviously, there's opportunities for carriers I would look just as bellwethers. The Express carriers certainly what FedEx does what UPS does DHL the the there's a number of both Asian and European operators I pay attention to there really has been very few Asian orders the Singapore order notwithstanding, but I'd be looking at some leading Asia and European operator and what they decide in terms of their fleet the all freight carriers another one cargolux NCA would have been ABC, VDA, that at maybe on hold for a while. But, you know, there are carriers that kind of people watch and they are there isn't a whole lot of, of really, really significant carriers and thus, there's a handful that that are in play, and that will determine the success of each program. I should mention too, that I'm looking forward to cargo fax EMEA in mid May, as an opportunity maybe for carriers to announce Farnborough in in July is another place where there may be order announcements, and certainly our cargo facts symposium in October in San Diego. So, you know, there's both timing and there's carriers that I would watch for I would think, a year from now, we'll sure know a lot more about where both programs are going. But it's it's a fierce competition. Now, there's no doubt about it. I mentioned a 350 with five customers and triple seven, eight F with two large customers and the gap between the MOU orders are is closing. So it's going to be very, very interesting. But you know, there are carriers that you can kind of watch as setting a trend. Jeff Lee right, I mean, we now have so many options to choose from in the large wide body space. Completely different from several years back. Meanwhile, we're one step closer to the end of the 747 Dash eight, with UPS, about to take its final unit. And that means all that's left now is the order for four from Atlas. Andrew Crider We're still very sad to see the end of the 747 Dash eight production. It's been an incredible platform. But on that note, Jim, I want to thank you for joining us in providing your experience and expertise. And that's all the time we have today. To those who are listening. Thank you for tuning in to this episode of cargo facts Connect. For more multimedia content like this, check out cargo facts.com and search cargo facts connect on iTunes Spotify. Join us again next time. Subscribe to Cargo Facts Connect on iTunes or Spotify , or download the episode on Transistor . Cargo Facts EMEA will take place LIVE May 9-11 in Dubai. Learn more and register.

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