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Bear market and conversions
There will generally always be a need
for some conversion activity annually -
to what level however is the question,
says Whaley of IBA. "The 737-800BCF
conversion rates in particular remain
strong, though there is no ignoring how
risky the credits are becoming. We know
that EFW will remain by their steady
approach to conversion activity for all
four of their programmes (A320-200P2F,
A321-200P2F, A330-200P2F, A330-
300P2F), preventing the market from
any oversupply. The cargo market at the
moment is rather turbulent compared
to the pandemic years, yet conver-
sion activity remains rather high. The
likelihood is in the case of 737-800BCF
conversions that we do see a slowdown
due to the market only being able to ac-
commodate so many examples. Boeing
777-300ER conversions are likely to occur
but expect numbers to be relatively
limited due to the costs associated
with the conversion and only a limited
number of operators/lessors in such a
situation that allows them to commit to
the programme."
A view echoed by Nyman of K+N when Environmental considerations such
he says: "Yes, we do believe that there will as the disposal of the removed fuselage
continue to be a demand for conversions. passenger frame must be considered,
Worth mentioning is that the current adds Whaley of IBA. "In effect, parts
freight market is acting anti-cyclical: like this will have to be recycled and
passenger demand is so intense that it therefore will be subject to the same
impacts the cargo focus. As aviation is a environmental responsibility as a tear-
long-term business, most asset owners We do believe that down aircraft. In terms of the emissions
still predict a return on their investments, regulations that are due in 2028, this only
an investment that might have a longer there will continue to be a affects new production aircraft, in effect
return time than predicted during the demand for conversions. making all P2F programmes such as Boe-
pandemic. The drop in cargo demand is ing 737-800, Boeing 767-300ER, Airbus
outweighed by the increase in passenger Worth mentioning is that A321 and A330 exempt."
demand. Sharing a similar feedstock,
creates a more likely, faster, return on the the current freight market Narrow bodies continue
passenger side than the cargo market." to be in demand
is acting anti-cyclical:
"Our current and future lineup of Boe-
Regulatory changes passenger demand is so ing Converted Freighters play a cen-
A passenger-to-freighter conversion tral role in e-commerce and express
calls for strict regulatory interventions intense that it impacts cargo markets, delivering the capability,
to ensure stability of the aircraft. It can the cargo focus. reliability and efficiency our customers
take four to eight months to reconfigure need today, and going forward," says the
an aircraft for cargo, depending on size Boeing spokesperson. "The 737-800BCF
and the number of available repair bays Andreas Nyman is a proven global solution with more
Kuehne+Nagel
for particular aircraft types. "There has than 250 orders and commitments to
been little to no impact from a logis- Approvals around supplemental type date, and more than 130 deliveries since
tics perspective. This is more related to certificates (STCs) to install the neces- 2018. The airplane has the largest and
regulatory changes in collaboration with sary modification for a converted aircraft broadest operator base with more than
the authorities and the airframe OEMs. have caused delays," says Nyman of K+N. 40 operators and counting, across more
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