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Freighter Values Unchanged

September 26, 2022

The freighter market appears to remain extremely buoyant with conversions accelerating and more orders being placed but freighter traffic is perhaps seeing some weakness not least because of supply chain issues.

IATA reports that for July 2022, airfreight traffic was some three percent lower than for the same month of 2019 and nearly ten percent lower than July 2021 (IATA does not include data from all operators, only those that are members of the organization, but the majority of traffic is reported. ICAO represents the global airline industry but there is no requirement for operators to report data). In terms of capacity, this fell by eight percent compared to July 2019 and increase by 3.6 percent compared to July 2021. The amount of airfreight capacity increased by four percent during the first seven months of 2022 but was nine percent lower than for the first nine months of 2019. While the number of dedicated freighters has been increasing over the last two years, the amount of lower hold capacity still remains constrained due to the gradual restoration of long haul passenger operations. A significant proportion of the A380 fleet remains in storage and B777-300ER operations are far from being restored. The B747-400 has essentially been withdrawn from passenger service. International passenger operations from China are also limited. Surface transportation is also gaining more traffic but supply chain issues and the consequences of local lockdowns in China remain concerns. The global economy is also suffering from the effects of higher inflation and therefore the threat of recession looms. The strength of the dollar makes shipping by air that much more expensive. This raises the question of whether the hitherto strength of freighter values can be maintained, particularly as more are converted. In 2019 the airfreight market was particularly weak with many freighters in storage.

The Aircraft Rating ( reflects the considered suitability for asset based financing over a seven year period. Ratings range from A++ to E—and are provided by The Aircraft Value Analysis Co. Ltd. (AVAC) who were the first to launch ratings for aircraft in Aircraft Value News more than a decade ago. The Aircraft Value Analysis Co. Ltd. (AVAC)s Aircraft Ratings have since become the benchmark for the industry, investors and the appraisal community. Those aircraft scoring an A or B rating indicate suitability for asset based financing over the next seven years. A rating of C or D indicates that the owner needs to be aware that the risks are much greater even if the rewards can also be higher. A rating of E indicates little suitability for asset based financing and that attraction lies with the existing operator.

Freighter Current Values US$ millions – September 2022
Aircraft Rt Age Value Trend Analysis
A300-600RF D- 1994-98




The improvement in the airfreight market has allowed values of the -600RF to see an improvement reversing years of decline. With the slowdown in airfreight traffic growth, values of the -600RF are perhaps more vulnerable because of the preference for other types. A significant number are operated by the small package operators who will likely retain the type for some years.
A310-300F D- 1985-90




The -300F can hardly be considered to be at the forefront of the freighter market and as such it is considered that some modest reduction to the value is warranted.
A321-200P2F B+ 1996-09 17.0-32.0 The market for the A321P2F is surging for a number of reasons. The change in market structure due to internet shopping is increasing demand for regional capacity; the value of older A321 passenger aircraft is now at a level which makes conversion economic; the lower hold capacity of the A321 is attractive; the fuel efficiency lends itself to replacement of previous generation aircraft. To some extent, the A321P2F is overshadowed by the B737-800F but the rising number of conversion orders suggests that more than 100 will be converted in the next few years. Values of the A321P2F are therefore warranting something of a premium even over the B737-800F.
A330-200F C++ 2009-18 37.0-65.0 The production freighter arrived at just the wrong time – when the airfreight market was in freefall due to the great recession. Customers for the type increasingly changed orders to the passenger version. The values of the type have however, enjoyed unexpected improvement as a result of the peculiar repercussions of the Covid Event. As airfreight traffic flattens, there is little to suggest that values should see a further increase and indeed the values of the younger examples may warrant a modest fall except that the economics are all the more attractive in a high fuel price environment. The post production conversion program is proving less popular than for the -300P2F.
A330-300P2F C+ 2002-08




With the A330-300P2F conversion program still in its early stages, the values are remaining steady. Unless the airfreight market sees a surge in traffic, then it can be expected that values will remain at these levels or even lower not least because of the decline in the values of passenger -300s.
B737-300SF C– 1986-91 2.9-4.6 There can be no escaping that the demand for the -300SF remains strong even in an era that is seeing ever more conversion of more capable narrowbodies. The dynamics of the narrowbody freighter market are perhaps different from those of the widebody given the change in structure even if internet shopping is no longer such an imperative for consumers. Embraer is seeing the E190/E195P2Fs as an alternative to the B737 Classic freighters but any displacement will take time. The higher price of fuel is a concern even with limited utilization.
B737-400SF C 1992-97






B737-800SF B++ 1998-09 17.0-31.0 There are at least a hundred -800Fs already in service and perhaps more than that due to be converted. Not only do new conversion orders seem to be placed on a daily basis but new conversion centers are opening up. The values of the -800SF have increased as popularity has increased. There has to be a recognition that for some operators, there is an economic ceiling in terms of values. With restrictions on overnight operations, utilization cannot be easily increased and with perhaps only one return flight in any twenty four hour period, there is little opportunity to increase revenues. At some point the -800SF will displace the B737 Classics but not perhaps for another few years. The still low cost of feedstock is an advantage for the lessors. The -800 may even lend itself to a hydrogen conversion program.
B747-400F C+ 1993-00




There is perhaps a concern that the relative slowdown in airfreight traffic may affect the demand for the B747-400F. Yet, there also remains the possibility that once the supply chain issues are resolved, particularly in China, then there may be a renewed surge in demand notwithstanding the possibility of a global recession. The values of the -400F are therefore remaining stable at the present time.
B747-400BCF C 1989-00




The market for the BCF is not as good as for the -400F because of the lack of a nose loading door but in this market, that is no hindrance to demand. As with the -400F, this is the peak of the market for the type not least because of the conversion of the -300ER.
B747-8F B 2010-22 85.0-175.0 Production is ending but values remain steady for the moment as even with four engines, the type is viewed as more suited to the long haul freighter market. The last few years has seen an appreciable rise in value. Converting existing passenger -8Is to freighters seems unlikely given the limited number in service but it may be feasible given the low feedstock pricing. The capital cost of the -8F makes it necessary for the aircraft to be used intensively and there are relatively few routes that can support such operations.
B757PF C 1987-93 6.0-9.0 While there are many arguments that should suggest that values of the B757 freighter should be reducing – age, economics, competition – this is simply not being reflected in the current market. The cost of quality feedstock can be in excess of $6 million which, combined with the $5 million conversion cost, can easily lead to a value of $12 million. Yet, with the A321 now being converted this represents a formidable competitor as long as the post conversion A321P2F value is reasonable. There will be some aircraft – particularly the production B757-200PFs – which will have relatively little in the way of utilization and will therefore have many years of life remaining. These aircraft can be expected to attract a premium
B757SF C 1994-98






B767-300F C+ 1995-02






Ever more orders for new and conversions are being placed defying logic. As such values of the type are holding firm with pricing of new -300Fs perhaps being in excess of $80 million. Those -300ERs with lesser utilization are most in demand as conversion needs to see at least another ten years of use without incurring major service bulletin life extension modifications. The values of the converted -300ERSFs versus the production -300Fs can be expected to be some 10 percent lower because of the greater accumulation of hours and cycles. The -300ERF is destined not be produced after 2027 because of the ICAO restrictions unless GE can improve the CF6 engine.
B777-200F B+ 2008-22 76.0-160.0 Inflationary pressures continue to see values of new examples climb and this is allowing used values to remain stable despite advancing age. With the serviced entry of the B777-8F still some years away, operators now have limited choice if they wish to acquire a new production freighter but the number of operators able to afford the price of a new B777F – which will probably be higher than the indicated value – is limited. The twin engined economics are even more essential given the volatility in the price of fuel.
B777-300BDSF B 2003-10 50.0-85.0 The conversion process is slowing gathering momentum but at $30-35 million for the conversion, then there are only so many that can afford to undertake the modification. Again, lessors with low book values on passenger aircraft – particularly after having to incur impairments – remain the key customers for the type with subsequent lease rentals of between $550,000 and $875,000 per month generating far greater returns than a passenger example could ever manage.
MD11SF E– 1991-93




There are still a number of MD11 and MD10 freighters in service but of course those of FedEx and UPS dominate which raises the question of where the aircraft will go when no longer required. Some MD freighters have actually been brought back into service.
Commentary reflects change from the last update to Freighter Values of June 2022.


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