Precision and ATSG form A321 freighter conversion JV

Ending its silence on the subject of “what comes next,” 757 conversion specialist Precision Aircraft Solutions this morning announced the formation of 321 Precision Conversions, LLC, a joint venture with Air Transport Services Group (ATSG) “to develop a passenger-to-freighter conversion of Airbus A321-200 Aircraft.”

It has been something of an open secret in the industry that Precision has been considering a conversion program for the Airbus A320 Family. The A321 is the closest thing to a logical successor to the company’s highly successful 757-200PCF conversion, and, in that light, the formal announcement is no surprise. The partnership with ATSG, on the other hand, has been closely guarded. But, while it may seem surprising at first, it, too, is a logical next step for both companies.

The joint venture is actually between Precision and Cargo Aircraft Management (CAM, ATSG’s leasing arm) and Precision and CAM have worked together in the past. Not only was CAM a customer for four Precision-converted 757-200PCFs, it was also the launch customer for Precision’s 757-200 combi. Beyond the shared history, though, the joint venture approach appears to be a good fit for both. Precision, obviously, has the engineering capability to bring a freighter-converted A321 to market, and, as ATSG CEO Joe Hete said: “Expanding our fleet to include A321-200 freighters in that segment of the market through this new partnership with Precision will supplement the shareholder value we create in the future.”

Reading that statement, you might conclude that ATSG, through CAM, will be the launch customer, but Gary Warner, President of Precision Aircraft Solutions (and of the JV) said this was not the case. 321 Precision Conversions does have a launch customer signed up, but that customer will stay unidentified until the formal announcement at the Cargo Facts Symposium (2 – 4 October, in Miami).

However, while the identity of the launch customer – and technical specs of the converted freighter – will remain a mystery for the next two months, we can pass on some hard information.

• While the competing EFW program will offer P-to-F conversions of both A320 and A321 aircraft, the Precision/ATSG program will focus solely on the A321.

• Airbus will support the non-converted areas of the freighter. That is, while 321 Precision Conversions will be responsible for technical support of those parts of the aircraft affected by the STC, Airbus will continue to provide OEM support for the rest of the aircraft.

• And, speaking of the STC, the company says it expects to begin cutting metal on the conformity aircraft in 2018, and to receive certification for the program in 2019. While this timetable might seem optimistic, Precision in fact began full-scale engineering development in the third quarter of 2016, which makes certification in 2019 more realistic.

Looking ahead, Gary Warner said the company expected demand for between 200 and 300 A321 freighters, with China and Europe as the biggest markets. He also said he foresaw increasing demand in South America, with that market eventually becoming comparable to North America.

And what of the 757? Warner said Precision expected strong demand for the 757-200PCF to continue for another three or four years. So ramp-up of A321 conversions following a 2019 STC would allow for a smooth transition from one program to the other.

Finally, if you are interested in learning more about this new program, and about how the A321 and other narrowbody freighters will fit in to the long-term trend of e-commerce driving increasing demand for express delivery, join us at the Cargo Facts Symposium in Miami, 2 – 4 October, where both Rich Corrado, Chief Commercial Officer of ATSG and President of CAM, and Gary Warner, President of Precision Aircraft Solutions and 321 Precision Conversions will join us as speakers.

To register, or for more information, go to CargoFactsSymposium.com.