LATAM disengages from 777F plans

Chile-headquartered LATAM has cancelled an outstanding order with Boeing for a single 777F [FAT 006222]. Instead of adding a second type to its all-767 freighter fleet as had previously been an option, the carrier’s freighter fleet plans now focus solely on the medium-widebody 767 platform. “On April 29, 2021, LATAM and Boeing entered into certain arrangements with respect to purchase agreements…the parties agreed to terminate orders for four B787 and one B777F aircraft,” LATAM reported in its second-quarter earnings release. In March 2020, the carrier group motioned to reorganize and restructure debt in the U.S. under Chapter 11 bankruptcy and thus the arrangements are subject to approval by the U.S. Bankruptcy Court for the Southern District of New York, which took up the case. [caption id="attachment_415902" align="alignright" width="536"] LAN Chile previously had three 777Fs. (Photo/LATAM)[/caption] Boeing’s order and delivery summary through April 30 has not been updated to reflect the change and continues to show an unfulfilled order for a single 777F from LATAM Airlines Brasil. Had the 777F been delivered, it would have reintroduced large widebody freighters to the group’s freighter fleet, which in 2018 consolidated around the 767 freighter . Shortly after the 2012 combination of Chile-based LAN and Brazil-headquartered TAM to form LATAM, LAN’s cargo affiliates had operated both the 767F and the 777F. TAM had intended on growing its 777F fleet and in 2014, after the merger had completed, converted existing orders with Boeing for 777-300ERs orders to an order for two 777Fs. However, after sluggish cargo traffic growth following the merger, LATAM moved to begin phasing-out the own-operated large widebody . It has since continued to grow its 767 fleet. Earlier this year, LATAM firm-ordered four 767-300BCF conversions from Boeing and added options for up to four more. Redeliveries are expected to begin in December and will run through July 2022. As was almost universally the case, cargo was a strong financial performer for LATAM during the first quarter of 2021. Cargo revenues rose 37% year on year to $345 million. Despite the increased revenue, traffic was still 12.1% lower at 731 million revenue tonne kilometers, in part due to lower bellyhold capacity. Even with increased freighter utilization with the group’s eleven 767Fs and capacity further supplemented by the addition of cargo-only passenger flights, cargo capacity across all aircraft types was still down 29.5% from the first quarter of 2020. Excluding the LATAM aircraft, Boeing now has forty-two 777Fs left to deliver, including five that Silk Way West recently ordered. Cargo Facts EMEA, taking place June 2-3 as a virtual experience, is the event for exploring opportunity in the EMEA 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.cargofactsemea.com .

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