B767-300F Lease Rentals Achieve Stability Where Others Cannot

April 16, 2018

With the airfreight market continuing to show signs of improvement, notwithstanding the implications of the trade war between China and the U.S., freighters are once again in vogue but the B767-300F has perhaps been one of the few to remain in demand throughout the good times and bad even if there has been some volatility.

The least rentals of the -300F have experienced considerable volatility over the years. Notably, in the peak of the market just over a decade ago, rentals jumped while values remained flat. Both subsequently experienced a significant fall with only a momentary respite. More recently lease rentals have remained stable which for a near 20 year old aircraft is encouraging. In terms of the future, then because of the lag between the improving airfreight market not least as a result of e-commerce traffic and the ability of the manufacturers and conversion centers to provide additional freighters, there should be some further positive signs for the B767-300F.

The B767-300F has seen demand both in terms of the production freighter and the conversion of passenger aircraft. There have been 196 orders for the production freighter albeit from only nine customers. Inevitably FedEx (108) and UPS (63) represent the major customers. FedEx still has 57 remaining to be delivered, the only customer which still unfulfilled orders. A concentration of the type may sometimes be viewed as a negative and when FedEx and UPS eventually decide to divest themselves of the aircraft, dispersal may take some time as there has only 26 operators (including five in the LATAM Group); two operators in the ANA Group; and two in the Atlas Group. With 135 deliveries of production aircraft and a fleet of 198 freighters overall this suggests that some 60 have been converted to freighters. A significant number of -300F freighters also encompass winglets which represents a costly investment but offers significant fuel savings, particularly if utilization is reasonably high. For the converted freighters the issue in terms of values is the amount of utilization accumulated during passenger service which will be much higher than for the production freighters which may be used for only a few hours a night whereas a passenger aircraft will be used for some ten or more hours a day.


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