Boeing 747-8F: Great Freight Debate
It may have taken four decades for it to happen, but the first major stretch of the Queen of the Skies is to make its public debut in just a matter of a few weeks time.
Against a backdrop of plummeting cargo traffic, yield erosion, airplane deferrals and cancellations, the 747-8F Freighter has managed to successfully navigate and retain its order book. Around 38% of the 747-8F backlog comprises three carriers from Asia, where cargo volumes have struggled to bottom out. Just six months ago, many airlines were (and in some cases still are) seeing double-digit drops in traffic (Source).
So where does this leave the 747-8 Freighter?
Actually, in a pretty enviable position for a multitude of reasons despite cost overruns and a delay to its service entry.
Video courtesy of Boeing
The first 747-8F entered its final body join last week, cementing its position as Boeing’s biggest jet as well as becoming the longest airplane in the world at 76.3m / 250.2ft (slightly behind the Antonov AN-225 Mriya).
But with the freight market still in the doldrums, concerns about its recovery are matched with hope that in the absence of another large freighter in the market, the 747-8F seems poised to ride out the storm despite near term pressures.
In my discussions with various industry experts, the overall consensus is mixed with both concerns and optimism.
“It seems to me that cargo is down in the dumps big time and will remain so for years. While I commend the aircraft itself as being the right way for Boeing to go my immediate outlook for program success would have to be negative,” says senior BGC strategist Howard Wheeldon.
Critically, with a number of operators, such as China Airlines, EVA Air and Cathay Pacific, withdrawing the existing 747-400F’s and 747-400BCF’s (click for image), the likelihood of some of these jets returning to service is at best murky and unclear - underscoring the fact that just 38 747-400’s have been converted to freighters, with Bedek having converted a further 14 more examples.
According to Boeing’s Commercial Airplane Services, a further 11 747-400’s have been earmarked for conversion however, with the existing parked fleet of 747-400F’s/BCF’s going up, it remains to be seen whether these conversions will materialise - opening the door to operators perhaps taking some of the existing parked jets rather than sink new money into converting older jets.
With the introduction of the 777 Freighter, the economics of new build freighters continues to far outweigh the benefits of withdrawn airplanes from the world fleet and thus makes the value proposition for converted jets to be less attractive as operators continue to push for efficiency gains.
“When the 747-8F was launched, Boeing made four assumptions:
• The A380 would make a mediocre cargo plane
• Development costs for the new 747 would be relatively light
• Cargo traffic growth would generally stay strong, despite cyclical ups and downs
• Passenger demand for the 747-8I would provide limited, incremental help for the total -8 business case
So far, only the first of these has proven correct. The A380F is quite dead, and will likely stay dead. But development costs for the 747-8 have been considerably higher than expected. Cargo traffic has been crushed by the downturn, with previously unheard of negative market numbers.
That Lufthansa 747-8I order is still kind of out there as the only airline order of note.
On the positive side, these developments are all water under the bridge. There’s not much that can be done about them now.
This plane looks on course to slowly head towards a two per month program as the cargo market and the economy slowly recover. And even though the 747-8F is in a small niche market, the closest thing to competition is used 747 conversions. This, of course, helps explain Boeing’s interest in charging tech support fees for conversions performed by other people,” says Teal Group’s Richard Aboulafia.
First Boeing 747-8 Freighter being moved for final body join
Image courtesy of Boeing
“With global freight markets currently under severe if temporary pressure, it would seem hardly appropriate that Boeing and Airbus between them are currently introducing three new freighters. But market snapshots belie longer-term trends and it is therefore to the longer term that Boeing will look for the success of its new 140-tonne 747-8F, complementing the recently-introduced 103-tonne 777F.
Freight markets will rebound as global GDP recovers from the present stasis, but they will recover in an evolutionary rather than revolutionary way, as Airbus has already found out with the failure of its Hubris A380F program. No point in buying an expensive meal if you only want a sandwich.
Forty years ago, the 747 program found a niche in the commercial field for what had essentially been a freighter design. Some niche, 1,523 sales later…
The future for the 747-8F therefore now has to be considered an incremental rather than a trail-blazing one, as was rather the case with its illustrious predecessor four decades ago. If the 747-8F program reaches 300 sales within the next 10-15 years, that’ll be considered a success and a solid continuation of the successful 747 lineage. They’re a quarter of the way there already,” says Arran Aerospace MD, Doug McVitie.
As the first 747-8F gears up for its first public appearance, Boeing has since passed the 50% design release milestone on the 747-8 Intercontinental.
Three 747-8 Freighters are involved in the flight test certification program ahead of planned service entry with Cargolux in the third quarter of next year.
A total of 1700 flight hours along with 2100 hours of ground testing will be split between the three test airplanes.
First flight is tentatively scheduled during the fourth quarter this year.
55 comments July 27th, 2009
