Market demand expected to weaken for converted 757 freighters, but interest remains strong for now

The Boeing 757-200 was by far the most popular plane in the 757 aircraft series. Of the 1,050 Boeing 757s that were produced, 913 were 757-200s. Although production of the 757 series ended in 2005, this aircraft is still used by several airlines. The production freighters were built from 1987-1999, mostly for UPS (United Parcel Service), and they were able to accommodate fifteen main-deck pallets. Boeing developed a freighter conversion program for DHL and modified thirty-four aircraft between 2001 and 2003. The 757-200F is the largest of the competing narrowbody freighter candidates. It offers two-crew, two-engine economics with 25% more cargo volume than the 727-200F. In recent years, there was some market interest in launching a 757-300 program, but feedstock quantities and age profile of the fleet do not justify the launch of such a program. Currently, there are two certified active programs for the 757P2F. The first, Precision Aircraft Solutions (previously Precision Conversions), started to undertake the engineering, prototyping and certification of a 757-200 passenger-to-freighter conversion program in 2001. The program continues to be extremely successful, and they redelivered a total of twelve 757-200PCFs in 2021. The other active program belongs to Singapore-based ST Engineering. This program was certified in mid-2008 and they have converted around 130 units. In the last couple of years, ST Engineering has been scaling down its 757 program to focus on the A321-200P2F. Our Conversion Center Location Interactive Map shows the current active conversion facilities for this type with three facilities in Asia (Chengdu, Xiamen and Singapore) and two in North America (Goodyear and Orlando). ST Engineering has a conversion capacity of three aircraft annually while Precision can convert up to fourteen aircraft every year. Converted 757s have been used as 727-200F replacement aircraft, but the relatively high cost of acquisition and conversion, plus the excessive cost of engine maintenance, places the higher-performance 757 at a disadvantage compared with the lower-priced 737-300 and -400 of similar age for applications outside the networks of major express companies. In an equivalent manner to the 737 Classic models, the feedstock pool of 757s for freighter conversion is shrinking (see Figure 1 below). Figure 1 - Overview of 727-200 Passenger Aircraft Feedstock Availability

Cargo Facts Consulting has analyzed the 757 freighter fleet in detail and the dashboard below contains two panels and looks at the 757 freighter base in detail by status, geography, age, engine type and operator. It also shows the current aircraft being converted (a total of thirteen) by owner name.

Data is current as of Feb. 7, 2022, and it includes all active and inactive 757 freighters, except for those that have been already scrapped (a total of 33 units). Some takeaways from our analysis: 72% of all 757 aircraft are Rolls-Royce powered (RB211); 63% of all 757Fs are based in North America, with FedEx and UPS operating 56% of the entire fleet; SF Airlines and DHL through subsidiaries such as DHL Air, EAT Leipzig and Blue Dart operate around 25% of the existing fleet; The average age of the active 757 fleet is 28.3 years with the youngest units in the seventeen-year range and the oldest in the thirty-nine-year range. Most of the active fleet was delivered between 1990 and 1998; and There are thirteen aircraft being converted now, by either express carriers or leasing companies. Most of these aircraft will end up in express operations in North America and Asia. Before the pandemic, conversion houses stated the difficulty in sourcing engines at reasonable prices for the 757 fleet being the main roadblock for conversions more than shortages in aircraft feedstock. This made us think that the 757 program only had a few years left, with the last units being converted in 2022-2023. However, the interest of 757 conversions does not cease and AerSale recently added six more firm conversion orders and four options for a total of sixteen orders . In addition, Kenya-based Astral just received its first 757-200PCF and plans to receive another two before June. Our Lessor Freighter Market Share interactive dashboard contains more details regarding the ownership of 757 fleets with details around lessors and customers for such type. Although the market for the converted 757 is expected to weaken, there is still demand with some units acquired for conversions. If operated at low utilization, this aircraft still has much to offer and even the older production 757-200 freighters will have many years of useful life remaining. With the A321 conversions becoming more popular, this aircraft represents a solid competitor, but its success will depend on the A321 market values prior to conversion and the ability to find 757 engines at reasonable prices. The 757 freighter program remains a success story and values have been able to stay unchanged for some time.

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Market demand expected to weaken for converted 757 freighters, but interest remains strong for now

Aircraft remains a solid competitor to A321 conversions

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B2B’s comeback defines yearend express results

Cargojet continues to dominate the Canadian landscape, but for how long?

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