The widebody freighter fleet: The more things change…

Today we begin our annual review of the widebody freighter fleet with some general observations on fleet growth, and a look at the fleet on a carrier-by-carrier basis. In the days ahead will continue with an examination of how the composition of the fleet is evolving, at carriers that ceased operations and carriers that joined the list of widebody operators, and then look to the future through the lens of the current order backlog (of both freighters and cargo-friendly passenger widebodies).

You can read Part II here, Part III here, and Part IV here.

Air freight demand has grown steadily, if unspectacularly, over the last five years. Given that worldwide cargo traffic in 2016 increased a little less than 4% over 2015, then the total increase in the last five years is about 18.5% – an average annual growth rate of 3.5%. This is well down from what would once have been considered normal, but it is very much in line with what many in the industry are now accepting as “the new normal,” after a period of wild swings in demand in the period around the financial crash that began in 2007.

So, if demand for air freight has been growing at a steady, if modest, rate for the last half-decade, should we expect similar growth in the widebody freighter fleet?

Well, we might expect it, but, as shown in the chart at the bottom of this post, and in Parts II and III to follow, we won’t find it.

As we look at the fleet at the beginning of February 2017, we count 1,002 freighters in commercial service worldwide, up 0.7% over the total a year ago.  The current total is up 6.0% over 2007, but that is only because deliveries of aircraft ordered by carriers and lessors in the years before the recession swelled the fleet despite the fact most of them were neither needed nor wanted. But after reaching a peak of 1,012 in 2012, the fleet shrank as deliveries slowed and carriers parked older freighters.

The result? Despite an 18.5% growth in air freight demand over the last five years, the number of widebody freighters in service has actually declined 1.0%.

But what about payload? The total number of freighters in the fleet may have been almost constant over the last five years, but there have been big changes in the number of each individual freighter type. For example, there are six times as many 747-8Fs in the fleet now as there were five years ago, and 747-8Fs are big freighters. So, is it possible that the 18.5% growth in cargo traffic has been accommodated by increased average freighter capacity?

Theoretically possible, perhaps, but a close examination reveals that the total available payload of the widebody freighter fleet has increased only 1.3% over the five years since the beginning of 2012. The retirement of 747-400F and Classic freighters (and MD-11Fs) has taken capacity out of the fleet just as quickly as delivery of 777Fs and 747-8Fs has brought capacity in.

The narrowbody freighter fleet has been expanding rapidly in recent years, so a small portion of the increased cargo traffic is likely moving in 757-200Fs and 737-400Fs, but Cargo Facts believes that most of it is carried in the bellies of the endless stream of cargo-friendly A330s, 787s, A350s, and 777s delivered to carriers worldwide to meet growing passenger demand. Looking ahead at the backlog of A330, A350, A380, 787, 777, and 777X passenger aircraft we see belly space equivalent to about 450 hundred-tonne freighters. Some of the passenger aircraft on order will replace existing aircraft, but unless demand for air freight increases significantly in the coming years, we expect that although the makeup of the widebody freighter fleet will continue to change, the total number of freighters will grow only slowly, if at all.

The more things change, the more they stay the same.

Not shown on the chart are carriers that lease widebody freighters on an ACMI basis, but do not operate any on their own behalf. This includes carriers such as Astral Aviation, which ACMI-leases a 747-400F from Atlas Air.

For carriers that both operate their own freighters, and also ACMI-lease additional lift, we show only the carrier’s own freighters. Saudia, for example, is shown with two 747-8Fs and four 777Fs, but it also ACMI-leases eight 747-400 freighters (a mix of ERFs, Fs, and BDSFs) from Air Atlanta Icelandic and myCargo Airlines.

Regarding aircraft operated on a CMI basis (Crew, Maintenance and Insurance), we show these in the fleet of the carrier that flies them. DHL Express, for example, has nine 767-200Fs and five 777Fs, but these are operated by Atlas Air and Southern Air, respectively, and we show them in the Atlas and Southern fleets.

Also not shown on the charts are the An-124s used in commercial charter service, all but one of which are in the fleets of Antonov Airlines and Volga-Dnepr Airlines.