A team from Israel Aerospace Industries (IAI) will fly to the U.S. this week seeking a supplemental type certificate (STC) from the FAA that will kick-start work on passenger-to-freighter (P2F) conversions of Boeing 777-300s at four sites in South Korea, the UAE and the U.S.
Talks are also underway for a fifth conversion site in India, with the possibility of a sixth being set up, potentially elsewhere in Asia.
IAI has spent the past five years preparing the groundwork for the STC, the Israeli company’s EVP Aviation Group Shmuel Kuzi told Aviation Week Aug. 20.
The Ben Gurion International Airport-based company believes there is significant potential for freighter conversions of Boeing’s big twin and already has agreements to undertake the work with partners in the mentioned countries.
Kuzi is hopeful that the necessary regulatory work with the FAA can be completed within a couple of months. If all goes well, that could lead to work on conversions starting at the four sites by the end of 2024. Typically, each line will be capable of 2.2 conversions per year.
Talks have been underway in India with Hindustan Aeronautics (HAL)—and at least one other company that Kuzi declined to name—over the possibility of a fifth conversion facility there. “Infrastructure is the main issue; you have to build the shops, hangars, et cetera,” Kuzi said. “It can be fast, it can be slow, it depends what we are going to invest. From our point of view, there’s no reason not to do it fast.”
IAI has previous links with HAL, in the form of a memorandum of understanding for 767 freighter conversions. More generally, “We have a long relationship with India as a country, so we’re glad to be there,” Kuzi said. “It’s a win-win situation. It’s good for India, and it’s good for us.”
India is potentially a huge market, but globally, there is also significant demand for a freighter in the 777-300 class, with its capability of carrying up to 100 tons of cargo, Kuzi said. By comparison, a 767 freighter—of which IAI has converted more than 200 over the past 14 years—can carry around 60 tons.
Kuzi does not believe that even if all IAI’s planned 777 conversion sites started work there was a risk of creating a glut. The pandemic had positioned the air cargo business center-stage and volumes were increasing by 3% to 4% annually, “So there’s no way there will be over-supply,” he said.
Only around 4% of world trade goes by air, “but every 1% is a huge amount,” Kuzi said.
Additionally, there is no lack of feedstock. If all IAI’s planned lines are operating, “We’re talking about a minimum of 10 years of work,” Kuzi said.
IAI is partnering with lessor AerCap to invest in the 777 P2F facilities: “The investment is between us,” Kuzi said. “It’s not small money, but it’s not too huge if you’re with a partner.”
The next stage in IAI’s P2F work will be to seek a similar STC for the Airbus A330, Kuzi said. “We’re now finishing work on the 777; we’re in the middle of work for getting an STC for the A330. We started that 18 months ago and in 1.5 to two years, I’m sure we’ll have an STC for it.”
