CFS: Dwindling 767 conversion feedstock could mean Airbus conversions for Atlas Air

MIAMI — With the feedstock for 767 freighter conversions dwindling, Atlas Air Worldwide (AAWW) CEO and president Bill Flynn said the carrier is looking to Airbus’ A330-300 to pick up the slack. “At some point we simply run out of 767 candidates for conversion,” Flynn told the audience here at this year’s Cargo Facts Symposium. “The 330 300 freighter shows a lot of promise.”

As the head of one of the largest airfreight carriers in the world, Flynn’s outlook and subsequent leadership is an important indicator of where air freight is going, and this year, AAWW’s optimism reflects an industry growing well ahead of global economic growth rates.

With demand continuing unabated, AAWW will need more aircraft. On a previous panel, ATSG COO Rich Corrado had admitted to turning down contracts due to a lack of aircraft. At AAWW, expanding the carrier’s options ensures that it won’t face that unpleasant choice.

“The biggest driver of growth in airfreight is going to be that growth in the middle class,” Flynn said. “It’s going to drive airfreight growth. People are going to want choice.”

That choice, by Flynn’s estimations, is going to lead to increasing e-commerce sales. “E-commerce as a part of retail is only around 10 percent, and half is streaming media,” Flynn said. “I would conclude from that the opportunities are significant, and it’s hard to tell what that’s going to look like, but the opportunities favor air.”

With the possible addition of Airbus freighters, and growing e-commerce volumes, moderator David Harris asked Flynn whether general cargo was being neglected in the discussion. “We’ve seen great growth in the heavy freight market,” Flynn said. He added that AAWW had “made billions of dollars of investment in long-haul, widebody freighters,” with heavy freight in mind.

Given AAWW’s global reach, the conversation also turned to regional growth, starting with the carrier’s market-defying success in Latin America against a regional economic downturn. Flynn agreed that the carrier’s results were well ahead of that he could have expected. “I would have expected a downturn, yet the underlying freight market continues to grow,” He said. “Our load factors are running at around 85 percent on a round trip basis”