Falling value, e-commerce boom leads to converting jets to freighters

SYDNEY/JERUSALEM/MONTREAL (Reuters) – From Air Canada to China’s CDB Aviation, airlines and leasing firms are rushing to permanently convert older passenger jets into freighters, betting on a boom in e-commerce as the value of used planes tumbles amid the pandemic.

That has created a huge opportunity for passenger-to-freighter (P2F) conversion companies, including Singapore Technologies (ST) Engineering Ltd, Israel Aerospace Industries (IAI) and U.S.-based Aeronautical Engineers Inc.

Aviation analytics firm Cirium expects the number of P2F conversions globally will rise by 36% to 90 planes in 2021, and to 109 planes in 2022.

“We estimate that most slots are sold for 2021 and at least 40% for 2022,” Cirium Head of Market Analysis Chris Seymour said.