Atlas Air, the largest operator of Boeing 747 freighters in the world, will augment its fleet with four more 777-200 cargo jets ordered from the manufacturer to support strong demand from express delivery and e-commerce customers, the companies announced on Thursday.
The transaction marks Atlas Air Worldwide Holdings’ (NASDAQ: AAWW) first direct purchase of 777s, adding to its inventory of 14 aircraft. The airline took possession of several 777s when it acquired Southern Air five years ago. The rest of them are used aircraft purchased and provided to customers by its Titan Aviation Leasing subsidiary.
Boeing (NYSE: BA) is expected to deliver the first of the four new 777s in November, with the other three to follow throughout 2023.
“These new aircraft will advance our strategic growth plan as we continue to capitalize on strong demand for dedicated airfreight capacity. This investment aligns with our disciplined approach to deploying capital and meets our strict return guidelines when investing in aircraft. We anticipate this transaction will drive strong earnings and cash flows, and enhance shareholder value,” CEO John Dietrich said in a news release.
Last year, Atlas bought eight 747-400 cargo jets coming off lease to maintain capacity because nearly every all-cargo plane that can fly is being operated during the pandemic shipping boom.
Boeing forecasts that the global freighter fleet will grow by 70% in the next 20 years as international trade and e-commerce continue to flourish. A barometer of how strong the air cargo market is expected to be beyond the pandemic is Boeing’s orderbook. Through November, Boeing surpassed the previous record of 80 orders in a year for production freighters and more than 80 orders for converted models. It will announce full-year 2021 orders and deliveries next week.
The 777-200 is the longest-range twin-engine freighter currently in operation, with a maximum payload of 224,900 pound and less fuel burn than older generation aircraft. That means fewer stops and landing fees for cargo airlines.
Atlas Air has 49 Boeing 747 freighters in its fleet. It will take delivery in 2022 of four 747-8 freighters it ordered a year ago — the last four 747 freighters Boeing will produce. It also operates medium-size 767 and narrowbody 737 aircraft.
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