Converted Freighters on the Rise, Impacting New-Built Freighter Market?

The pandemic was a blessing in disguise for the air cargo industry. By shifting the focus to cargo, aviation experts have transformed it into a multi-billion dollar industry that is constantly evolving to become more resilient. The trend of converting passenger aircraft into freighters to transport relief and medical supplies around the world was accelerated. As the importance of freighters grows, there are also concerns that converted freighters could pose a threat to the new-build cargo aircraft market. In this article, we try to explore how the rise of P2Fs (passenger-to-freighter) aircraft will impact the market for new-build cargo planes.

When there were millions of tonnes of relief and medical aid to be transported from multiple sources to multiple destinations during COVID-19, aviation was the fastest and most reliable mode of transportation that could be used. Moreover, passenger travel was completely shut and air carriers had to keep the business running to survive.

Converting passenger planes into freighters helped to keep the airlines afloat while ensuring that essential goods were still able to be transported during the pandemic. Conventionally, around 54% of the total capacity was that offered by the belly of passenger aircraft, however, the collapse of long-haul passenger demand presented a logistical challenge for carriers as well as air cargo users, which required some creative solutions. It was then that the idea of passenger-to-freighter conversions was revived.

The conversion process includes removing the seats from the aircraft and modifying the cargo hold to accommodate pallets of cargo. The aircraft is also fitted with a loading ramp so that cargo can be loaded and unloaded quickly and easily.

The Boeing 737-800 has been one of the most popular models for P2F conversions, with its fleet size almost doubling between April 2021 and April 2022.

Even though P2F conversions pre-dates the pandemic, driven by the need of the big integrators – express parcel carriers such as FedEx, DHL and UPS, and Amazon, to a degree, in the recent past, the first passengerto-freighter conversion was done by Cathay Pacific in April 2020 as they converted one of their Airbus A330-300s into a freighter. Since then, many other airlines have followed suit, including Lufthansa, Air France, and British Airways.

Moreover, P2Fs also cost less than purchasing new freighters and were more configurable to meet the specific needs of the airlines. Even though they did not offer the same range as freighters, nor were as fuel and space efficient, they can be safely termed as a lifeboat during the pandemic.

With the speculation about whether P2F planes can negatively impact the demand for newbuilt freighters, there are also those who see P2Fs as a complementary solution that can be applied along with new-built freighters to meet specific operational needs.

That being said, the number of new-built freighters is also expected to increase – a trend moving on the back of the increasing need for cargo capacity and the limitations on belly cargo capacity on wide-body aircraft. In fact, airplane manufacturers, Airbus and Boeing, are expanding their production of freighters to meet the increasing demand for wide-body freighters with long-haul capacity.

“The role of new build production freighters will continue to be critical as they bring to market the latest technical and structural innovations. This can lead to lower operating costs and for carriers with longer-term consistent strategic plans, they are the ideal equipment.”

Glyn Hughes (Director General, The International Air Cargo Association (TIACA))

This is an abridged version of the original article that was published in the August issue of Logistics Insider magazine. To read the complete article, click here.

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