As more air cargo capacity is needed, freighter conversion sector ups its game
With air freight capacity still well below 2019 levels and airlines predicting lower passenger traffic ...
As the first B737-800 freighter enters commercial service, the push for the larger A321 cargo aircraft is gathering momentum.
With delivery of the first A321 freighter less than 20 months away, the new entrant’s biggest backer has turned on the spigot for conversion feedstock.
Vallair, the launch customer for both A321 conversion programmes in the market today, has lined up six A321s for all-cargo configuration.
Gregoire Lebigot, president and CEO, said: “The A321 is a very popular aircraft because at the moment everybody wants bigger capacity.”
The six A321-200s that Vallair has acquired are going to short-term lease programmes in the aviation company’s portfolio, but they are designated for the freighter conversion scheme, Vallair has confirmed.
Peter Koster, head of Vallair’s cargo conversion business unit, said: “This recent transaction secures sufficient feedstock for the initial conversion programme and enhances our developing portfolio of assets.
“Vallair expects the prototypes of both programmes to obtain their initial STC approval by end-2019, ready to enter operation early 2020,” he added.
Vallair has an order for ten A321P2Fs, the joint conversion programme of Airbus, EFW and ST Aerospace (STA), plus options for another ten. It also signed up for five A321PCs with 321 Precision Conversions, a joint venture between ATSG and B757 conversion specialist Precision Aircraft Solutions. Vallair is the launch customer for both programmes.
With 14 pallet positions on the maindeck and the ability to carry 27.9 tonnes over 2,300 nautical miles, the A321 offers significantly larger capacity than the B737-800.
Roy Linkner, vice-president of sales and marketing at 321 Precision Conversions, said it offered 35% more containers, yielding 55% more cubic feet of capacity. With a lighter airframe and fuel burn to volume and weight payload ratio, it achieves lower unit operating costs and favourable economics overall, he added.
Moreover, the A321 can accommodate ten containers on the lower deck, the only narrowbody freighter with this capability. Mr Linkner pointed out that operators could go for containers, bulk loading or for a ‘sliding carpet’, which gives them much flexibility.
The A321 is widely regarded as the replacement for the larger B757, which can take 15 pallets on the main deck. Mr Lebigot sees a wider market than the niche occupied by the 757.
“We see a huge potential in the A321P2F, not only as a replacement of the B757F, but as a key tool for the industry to achieve the projected growth rate of the airfreight market in general – in particular driven by express services and e-commerce,” he said when the order with EFW/STA was announced.
Mr Linkner regards the A321 primarily as an express aircraft, but stressed it could fill other niches in the general cargo market. He pointed to Africa and Latin America, noting that LATAM has a sizable fleet of A321s.
By the time the A321 enters the market in numbers – 2020 and 2021 – many will be 16 or 17 years old, he said. Down the road, age limits will come into play in some markets, notably China. Mr Lebigot does not see a serious issue there, merely a constraint on moving aircraft between regions.
“My view is that China aircraft will be converted in China and will remain in China,” he said, adding that a similar pattern would likely unfold in Europe and the Americas. Vallair is preparing to open an office in the Far East, he added.
The company, which started out as an MRO specialist, later diversified into asset management and, more recently, added freighter conversions into the mix. It has completed ten 737-400 conversions so far.
Mr Lebigot expects this to continue for a while, but he is preparing for a switch not only to A321s, but also to 737NGs – mostly the 747-800 – and he also sees potential in the 737-700.
“Even the A320 will be a good freighter. We’re working on that,” he added.
Vallair has already started acquiring 737-800s in preparation for its foray into that segment. At this point feedstock for both the 737-800 and A321 is tight as passenger carriers have been holding on longer to the type than anticipated, which has kept residual values at lofty heights. These are expected to come down by 2020, paving the way for broader market penetration.
Feedstock for the larger plane is more limited, though. According to one industry executive, there are more than 500 737-800s that can be turned into cargo aircraft, but only about 120 A321s.