European Aviation Asset Management / Reykjavik / April, 7 ... · The Advantage of Freighter...

The Advantage of Freighter Conversion: The Case of Airbus

April 2011

Presented by

Michael Fürst / Airbus Freighter Conversion VP Marketing & Sales

European Aviation Asset Management / Reykjavik / April, 7 2011

© AIRBUS Freighter Conversion GmbH. All rights reserved. Confidential and proprietary document.

Agenda

• Introduction

• Freighter history

• Why are aircraft converted to freighters?

• Requirements for pax to freighter conversion

• Airbus Freighter Family

• Summary

April 2011

2


April 2011

AFC - The Joint Venture for Airbus A320/A321P2F

• Airbus Freighter Conversion is a special purpose company responsible for

A320P2F & A321P2F conversion :

• Programme Coordination

• Marketing/Sales and Customer Contracts

• Delivery of converted aircraft

3

EADS50 % UAC

50 %

32%

18%

25%

25%


Freighter history

• 1910: The first plane is used to carry shipments (a bolt of silk transported from Dayton to Columbus, USA)

• 1941: Development of the first true transport aircraft (Arado AR 232, German military transport aircraft)

• By the mid 1950s: Due to a strong need for post war commercial services, cargo aircraft are operated for civil used

April 2011

P4

Bristol Type 170 Freighter, 1953 Bristol Type 170 Freighter, 1953


Freighter market features

• Air-freight represents 1% of total world-trade tonnage but 35 % of world-

trade value:

• Classical commodities

• Basic materials, raw/agricultural commodities

• Intermediate: glass, metal, wood

• Textiles, home appliances

• High-tech commodities starting to out-grow non high-tech

commodities:

• High value exports: electronics, pharmaceuticals, consumer

supply-chain

• Industrial supply chains: just in time zero stock

• Consumer goods: perishables, e-commerce

5

April 2011


April 2011

6

Freighters today (new & converted)

0

50

100

150

200

250

300

350

146

DC

-9L-

188

737

727

TU-2

04 757

707

A31

0D

C-8

A30

0A

300-

600

767

L-10

11D

C-1

0M

D-1

174

7A

n-12

4A

n-22

5U

nit

s in

se

rvic

e

Payload (from 12t to 220t)

~1,700 freighters in service today

Small Mid-sized Large

Source: ENAC - Air freight market - 2010


7

More than 700 aircraft to be retired over the next 10 years

0

20

40

60

80

100

<1 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 32 34 36 38 40 42

Large

Regional

Small jets

Age of current freighter fleet

Fleet size

April 2011


20 years fleet growth per segment (in service freighter aircraft)

427

715+2.6%AAGR

694

1548

+4.1%AAGR

432

1,083+4.7%AAGR

Small jet

Regional &Long-range

Large

676

Mar

23d

, 2011

Source: Airbus GMF 2010

Small jet freighters: 727, 737, A320P2F, Bae 146, DC-9, Tu-204Regional & long range freighters: 707, 757, 767, 747C, A300, A310, A321P2F, A330, DC-8, DC-10

Large freighters: 747F, 777, A350, MD-11, A380

-Fleet growth: +3.9% AAGR

- Freighters in fleet in 2029:3,346 units

-870 new aircraft delivered , 2,470 converted

-Small jet demand is mainly driven by Express development in India & China

- Twin aisle A/C growth mainly driven by

world exports

2010 - 2029 Freighter fleet evolution

April 2011

Approximatively 2/3 of the freighter fleet

will be converted freighters in 2029

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New manufactured freighter or converted aircraft?

• Advantage of new manufacture freighter

• Aircraft is optimized to be a freighter: more loading flexibility

• Reliability

• Up-to-date systems

• Fuel consumption

• Advantage of converted aircraft

• Lower capital cost

• Availability

• The capability of the converted aircraft depends on the quality of the

passenger airframe and the amount of work that is put into the conversion

Utilization is a key factor in determining whether a new-build solution or a conversion solution is the best cargo aircraft


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P2F: What is Airbus' interest?

• To offer an exit strategy for airlines

• Pax have a poor perception of 20+ year old aircraft

• To make new pax sales

• Creating the exit strategy to make a new pax sale

• To sustain residual values

• Aircraft are assets: Flexibility = value

• To gain new customers

• Etihad, MNG, Galaxy were P2F customers before

becoming new freighter customers

• FedEx bought the new-build A300-600RF in parallel to

Airbus launching the A310-200P2F


Requirements for pax to freighter conversion

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Market demandTechnical aspects / Engineering

Feedstock


12

Market demands

Consumer goodsPerishables, e-commerce...

High value exportsElectronics, consumer supply chains...

Industrial supply chainsJust in time, Zero stock...

Time-definite products offered by general cargo carriers to

match integrators' services lead to a need for reliability and

frequency

Frequency as a driver of today's exchanges

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April 2011

13

0

10

20

30

40

50

60

70

80

90

100

B727 – B737 – B757 – BAe146 – DC9 – TU204Fleets

Integrators dominate the market

Source: acas, April 2011


Technical/Engineering Aspects for Conversion

• A conversion must be based on the original data from the OEM otherwise

it will be not approved by the airworthiness authorities

• Technical expertise of the conversion team is necessary

• Design and Production Approval (DOA and POA) needed

• Key personnel like flight test pilot & engineers, system specialist, etc.

• New and more strict airworthiness requirements

(no more ‘grandfather’ rights)

• New test & certification requirements

New conversion programmes are no longer feasible without the coorporation with the OEM !

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Feedstock

Average Conversion Age - Widebodies

0

5

10

15

20

25

30

35

40

1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008

Year of Conversion

Airbus A300 Airbus A310Boeing (McDonnell-Douglas) DC-10 Boeing (McDonnell-Douglas) MD-11Boeing 747 Classic B747-400Boeing 767

DVB Bank - 2009 April 2011

Source: DVB Bank

15


Average Conversion Age - Narrowbodies

0

5

10

15

20

25

30

35

1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008

Year of Conversion

Boeing (McDonnell-Douglas) DC-8 Boeing (McDonnell-Douglas) DC-9

Boeing 727 Boeing 737 (CFMI)

Boeing 737 (JT8D) Boeing 757

Feedstock

April 2011 DVB Bank - 2009

Source: DVB Bank

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© AIRBUS Freighter Conversion GmbH. All rights reserved. Confidential and proprietary document. CWRM

Airbus Freighter Family

2000 2011

A330-200F

Medium to long-range operations:Up to 70t (147,000lbs) / Up to 4,000nm

A300-600R / A310-300 P2F

Regional operations:Up to 48t (105,000lbs) / Up to 3,300nm

A320 / A321 P2F

Feeders:Up to 30t (60,000lbs) / 2,000nm

2020

A380F A350F

Long-range high payload operations:Up to 158t (330,000lbs) / Up to 5,800nm

Long-range operations:Up to 90t (200,000lbs) / 5,000nm

Subject to launch Product development study

A330-300 P2F

April 2011

Subject to launch

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A300F/P2F & A310P2F: The most popular regional freighters

Over 290 A300/A310F currently in service

The preferred choice for both integrators and general cargo operators

16 pallets 96"x125" SBS4 pallets 96"x125" SR

Main deck useable volume: 10,800 ft³ (306 m3)A300RP2F: Side by side 96"x125"x96" pallets

A310P2F: Side by side 96"x125"x96" pallets

Main deck useable volume: 8,460 ft³ (239 m3)

12 pallets 96"x125" SBS4 pallets 88"x125" SR

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The A330-200F: the all-new mid-sized freighter

The mid-sized freighter offers:

• Great resilience to difficult economic conditions

• More operational flexibility to suit shifting market demands

The A330-200F – the only all-new mid-size freighter

• 3,200 nm 70t Payload Mode

• 4,000 nm 65t Range Mode

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A320 Family: Leader in all market segments

Boeing

42%Airbus

58%

Network

2,742 in operation

101 operatorsMarket share (Number of operators)

Boeing

37%Airbus

63%

Low-cost

919 in operation


Boeing

38%Airbus

62%

Charter

274 in operation


Boeing

46%Airbus

54%

Leasing

1,714 on orders

28 lessorsMarket share (Number of customers)

Soon available as converted Freighters:

A320P2F and A321P2F

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April 2011

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Main Deck Cargo Door


April 2011

Superior volume capability

22

3 LD-3-45W 4 LD-3-45W

5 LD-3-45W 5 LD-3-45W

Main deck volumes:A320P2F: 4,620 ft3 / 131 m3

A321P2F: 5,940 ft3 / 168 m3

Lower deck volumes:1,119 ft3 / 31.5 m3

1,621 ft3 / 45.8 m3

Total volumes:5,739 ft3 / 162.5 m3

7,561 ft3 / 213.8 m3


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Only the Airbus solution offers lower deck operation with pallets or containers

AKHVolume = 3.6 m3 (127 ft3)

AKGVolume = 3.1 m3 (110 ft3)

79 in

61.5 in

96 in

60.4 in

max. 45 in

max. 45 in

60.4 in61.5 in

PKXVolume = 3.6 m3 (127 ft3)

PKVolume = 2.4 m3 (85 ft3)

max. 45 in

96 in

60.4 inmax. 45 in

61.5 in

47.5 in

60.4 in

56.4 in

61.5 in

More loading flexibility for your operations

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April 2011

OEM beats third party conversion

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All workmanship done in accordance with Airbus production standards

• Experienced Airbus know-how

• Design, certification, manufacture and implementation of conversion kit with Airbus quality

• Use of Airbus material only (e.g. main deck cargo door)

• All installed parts with Airbus part number


Customer Services

Access to Airbus Customer Services

for any aircraft issue:

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The Airbus solution: up to $US 1.5 million saving per aircraft over 10 years

More than 3700 people worldwidededicated to customer support

AIRTAC 24/7 hotline

Source: flightglobal, 29/05/2009

April 2011


April 2011

Commonality now applies to the freighter world

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Synergies through:Cross Crew Qualification

&Mixed Fleet Flying

A330-200/300 paxA340-200/300 pax

A330-200F & A320/A321P2F

A320 paxA321 pax

COMMONALITY

CCQ and MFF mean lower training costs and higher pilot productivity


Launch operator of the A320P2F

April 2011

Re-delivery to AerCap / West Atlantic scheduled for November 2012


Summary

• Air Cargo is a growing market with many opportunities

(triple over the next 20 years)

• Demand for over 3000 freighter aircraft up to 2029

• 2/3 will be converted freighter

• Most important markets are China, Asia , India and Latin America

• Opportunities for a second life of an aircraft asset

• Important selection OEM or Non OEM conversion solution

• Modern freighter fleet is the future

• Higher risk for large freighter

Month 200X

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April 2011

© AIRBUS Freighter Conversion GmbH. All rights reserved. Confidential and proprietary document. This document and all information contained herein is the sole property of AIRBUS Freighter Conversion GmbH. No

intellectual property rights are granted by the delivery of this document or the disclosure of its content. This document shall not be reproduced or disclosed to a third party without the express written consent of AIRBUS

Freighter Conversion GmbH. This document and its content shall not be used for any purpose other than that for which it is supplied. The statements made herein do not constitute an offer. They are based on the mentioned

assumptions and are expressed in good faith. Where the supporting grounds for these statements are not shown, AIRBUS Freighter Conversion GmbH will be pleased to explain the basis thereof.

AIRBUS, its logo, A300, A310, A318, A319, A320, A321, A330, A340, A350, A380, A400M are registered trademarks.

Thank you!

Visit us at www.afc.aero

European Aviation Asset Management / Reykjavik / April, 7 ... · The Advantage of Freighter...

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