Sichuan Airlines has placed an order with 321 Precision Conversions for kits to convert used Airbus A321-200 passenger jets into dedicated freighters, marking it the first customer in China for the U.S. aerospace engineering firm.
321 Precision Conversions, a joint venture between Oregon-based Precision Aircraft Solutions and diversified airfreight service provider Air Transport Services Group (NASDAQ: ATSG), said Sichuan Airlines plans to add at least three converted freighters to its fleet, with the first one (ex-Air Macau) entering production this month.
In a departure from typical conversion deals, Sichuan Airlines will handle the installation of the conversion kits itself because its parent company owns a maintenance, repair and overhaul (MRO) facility in Chengdu. Most airlines and leasing companies don’t own their own repair stations and those that do typically don’t do conversions.
Sichuan Airlines operates more than 180 passenger aircraft but wants to grow its small all-cargo fleet. It operates three factory-built Airbus A330-200 widebody freighters and is expected to receive two converted A330-300 freighters on lease this year.
Sichuan Aircraft Maintenance Engineering Co.’s entry into the conversion business indicates it will carry out more cargo transformations in the future — either for Sichuan Airlines or possibly other customers — because they couldn’t justify the capital expense in machinery, training and hangar space unless there was adequate payback potential.
“We are confident the A321-200 passenger cargo freighter is the perfect platform for future express/integrator cargo as well as general cargo. The low operating empty weight, reliability, and quality of Precision converted products is second to none,” said Chen Bo, president of Sichuan Aviation Industry Development Co., in a news release.
“China’s air cargo market has huge growth potential. We look forward to witnessing the bright future for narrow-body freighters in China together with 321 Precision Conversions.”
The initial conversion is likely to take several months. A Boeing 757, an older type of aircraft that the A321 is being marketed to replace, typically takes four to five months to overhaul for cargo. But the industry is experiencing supply chain delays and newcomers to airframe modification typically have a learning curve that adds extra time to completion of the initial units, according to industry experts.
Conversions are big engineering and manufacturing projects that involve removing all the passenger furnishings from the main deck, installing wide cargo doors and a protective barrier behind the cockpit, reinforcing the floor and wing boxes to support heavy containers, and installing a container loading system.
When Sichuan Airlines will be able to begin domestic operations with the first A321 freighter is unclear. 321 Precision recently applied to the Civil Aviation Administration of China for certification of its conversion design for the A321.
321 Precision Conversions has delivered four aircraft since launching commercial production in 2021. All the planes are operated by Malta-based SmartLynx Airlines on DHL Express routes in Europe. Three other aircraft are nearly finished — two for ASL Aviation, which provides outsourced airlift to express delivery companies in Europe, and one for Global Crossing, a Florida-based charter airline that is launching a freighter division, said Zachary Young, director of sales and marketing.
Narrowbody freighter conversions
Some analysts have warned of the potential for an oversupply of freighters because of the yearlong downturn in the air cargo market and spike in production of converted freighters since the pandemic. But Young said 321 Precision has not noticed a slowdown in orders and has not had any cancellations. The company already has a two-year backlog of orders.
A320/321 passenger-to-freighter programs are only two years old so the market is less saturated than for the 737-800. Only 20 aircraft have been delivered so far, including 16 by Airbus affiliate Elbe Flugzeugwerke GmbH.
Three conversion programs, including from Boeing, had a three-year head start and have delivered more than 160 aircraft so far, according to aviation research firms Cirium and IBA, with dozens more in progress. There are more than 15 combined production lines worldwide for the 737-800.
EFW last week arranged for its fourth A321 production line, with a different MRO in Chengdu.
Precision Aircraft Solutions has been one of the primary conversion houses for the Boeing 757. In October it started an extra conversion line at the Avex facility in New Iberia, Louisiana, as reported by Cargo Facts. The company will wind down 757 production over the next few years as the available feedstock for the plane dwindles.
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