Cargo conversion market hit by B737 Max grounding

Conversion firm Aeronautical Engineers has said that the grounding of Boeing 737 Max aircraft has hit the supply of feedstock aircraft.

Speaking at the Airline Economics Growth Frontiers conference in Dublin, Robert Convey, vice-president of sales and marketing at conversion firm Aeronautical Engineers, said the Boeing 737 Max’s grounding has hit the market.

“The restriction of feedstock has been massive,” he said.

Older aircraft that would have been candidates for freighter conversion are being kept in passenger service.

China is one important region where conversions have ceased, while in Southeast Asia they have hit a “brick wall”, said Convey.

In Europe and North America, meanwhile, older Boeing 737 models than previously are being converted.

Convey also points out that the US Federal Aviation Administration has hardened its stance because of the Max crisis, and is taking much longer to approve companies to perform conversions: “It’s fundamentally changed the way the FAA are looking at new freighter conversions… The effect that [the Boeing Max crisis has] had on the FAA is dramatic. It’s a different world.”

The process has thus become longer and more expensive.

The hiatus on new feedstock could last two years, Convey reckons, given the challenges of reintroducing the Max and the fact that many passenger aircraft have had their leases extended by two or three years.

Boeing 737 Max aircraft were grounded last year after two of model crashed within five months of each other. An automated system, known as MCAS, was found to be a factor in both tragedies.