IBA Contributes to an Aircargonews Article on Freighter Conversions, October 2017

IBA’s Moshe Haimovich, EVP Head of Freighter Advisory, speaks to Aircargonews on freighter conversions and the predicted market growth.

Passenger to Freighter conversions will form a sizeable tranche of the ‘new’ main deck metal entering the market over the next 20 years, according to airframers Boeing and Airbus. Airbus has forecast 1,224 conversions over the next 20 years and Boeing has assumed 1,560 conversions in the same period.

One of the main attractions of converting the asset to a freighter is that it will generate revenue for another 15 years or more beyond the aircraft’s useful economic life “retirement” age which today is frequently fewer than 25 years.

Asked about the short term passenger to freighter conversion market, starting with the smaller capacity aircraft, Haimovich looks to the next generation Boeing 737s, where in the B737-700 market PEMCO and IAI are in competition.

Of the B737-800 market, Haimovich states: “We currently have three players and tentatively a fourth. For the first time in the standard body sector, Boeing as an original equipment manufacturer (OEM) has launched a standard body conversion programme, although in the past it did have a conversion programme for the [larger capacity] B757-200.”

Aeronautical Engineers Inc. (AEI) and IAI also have conversion programmes for the -800, while a fourth supplier, PEMCO, is pending in its decision.

But there are other options in the standard body category, says Haimovich: “So far, the narrow body or standard body aircraft were dominated by the Boeing family, but we now have an Airbus A320 and A321 programme under development by EFW and ST Aerospace as well as by a new company called 321Precision, a joint venture between ATSG and Precision Aircraft Solutions for only A321 aircraft conversions.

“The A320 family cargo conversion attracts additional players in this market and we will most likely see more competition in the future.”

To read the full article click on the link below.

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