News / In it for the long-haul – carriers hang on to converted B757s

Photo: © Brian Grant

Industry analysts believe Boeing 757s have an attractive value proposition and are still a long-term investment for the air cargo sector – despite being elderly assets.

In March, Illinois-based aviation services company AAR Corp announced buying nine 757-200s, equipped with 18 RB211 engines,  signalling a potential increase in demand for support services for operators of the type. The aircraft were previously operated by American Airlines.

“There are still decent feedstock aircraft being converted, both now and into the future,” said Jonathan McDonald, manager – classic and cargo aircraft – at IBA. “By default, every passenger-to-freighter (P2F) conversion represents a long-term investment; anything between 10 and 15 years, and potentially longer still, and therefore these aircraft will require maintenance.”

For 757 freighters, Mr McDonald anticipated the outlook to be quite healthy, and IBA data seen by The Loadstar showed that in 2018, there were 23 conversions, 10 in 2019, 10 in 2020, 13 in 2021, 15 in 2022 and three so far this year.

“We earmark at least another 11 for the rest of 2023, so it seems the days of converting Boeing 757s are far from over,” he added.

FedEx was the biggest customer for conversions and UPS has been operating a vast fleet of factory-delivered freighters since 1987. Mr McDonald said while both carriers had long since satisfied their requirements for 757 freighters, neither had announced an intention to wind down their fleet.

FedEx made a huge commitment to replace nearly 100 727-200Fs, mainly between 2006 and 2013, so IBA just cannot see any logic in the operator looking to phase-out the model anytime soon. Mr McDonald said: “There simply are not enough more modern aircraft out there to replace the fleet.”

FedEx retired its last MD-10-30Fs at the end of last year and has announced its intention to retire its MD-11Fs over next five years.

“It needs its Boeing 757s, they are  its only narrowbodies, although there are some 737-400Fs and 800Fs in FedEx colours. But they only operate on another carrier’s behalf,” Mr McDonald noted.

Although FedEx and UPS account for a great chunk of the 757 freighter fleet, there are some other notable operators – YTO Cargo Airlines, SF Airlines and Cargojet are among recent customers taking P2F Boeing 757s,  he explained, adding; “So, although China now dominates 757 P2F demand, there are still plenty in North America.”

Amerijet has six converted 757-200s, with an average age of 24 years. Last year, CEO Tim Strauss told The Loadstar their RB211 engines were “overpowered”.

“The frame will go on forever. They have extraordinarily large engines, so they don’t work as hard. Partly because of the downturn, we have more requests for 757s than for our 767s. People are either downgrading from a 767, or upgrading from a 737. The 757s are more fuel-efficient.”

There are more modern narrowbody aircraft out there – the 737-800 and A321 – with significant numbers of freighter conversions, but Mr McDonald reckons the 737-800 is too small to be a 757 freighter replacement. He added: “Many perceive the A321-200 P2F suitable, but we have yet to see 757 freighter operators phasing them out in favour of the Airbus.”

IBA believes there is a healthy freighter fleet size to support and, while the passenger fleet is invariably in decline, it will still be around for a while to come.