Executive Briefings

UPS 747-8F Order May Resuscitate Boeing's Program

Just when the industry thought the sun might be setting on Boeing's workhorse jet, the aviation giant announced a firm order for fourteen 747-8Fs, plus options for up to 14 more, from express giant UPS. The announcement is being seen as a possible game-changer for the jumbo freighter, which, until last week, had only had enough orders in the pipeline to continue production through 2019, according to estimates.

With deliveries expected to begin next year and continue into 2020, this order will keep 747 production lines active.

UPS operates a large fleet of aging and less-fuel-efficient MD-11Fs and 747-400Fs, Cargo Facts reported, which will have to be replaced at some point. It is unclear whether UPS will retire older jets with the new deliveries, or whether the 747-8Fs will be operated in addition to the existing fleet.

In a statement, the integrator said the 747-8Fs will "enable UPS to begin a cascade of aircraft route re-assignments that will add significant air capacity to the company's busiest lanes, thereby optimizing global air network capacity well beyond the impact of adding new cargo jets."

The significant capital investment may also be a sign that UPS does not expect competition from Amazon’s Prime Air, or the global ambitions of rising Chinese integrators, to hinder its future ability to fill large widebody aircraft on international routes. It comes months after FedEx signed a long-term deal with Atlas Air for five 747-400 freighter aircraft during the current peak season.

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With deliveries expected to begin next year and continue into 2020, this order will keep 747 production lines active.

UPS operates a large fleet of aging and less-fuel-efficient MD-11Fs and 747-400Fs, Cargo Facts reported, which will have to be replaced at some point. It is unclear whether UPS will retire older jets with the new deliveries, or whether the 747-8Fs will be operated in addition to the existing fleet.

In a statement, the integrator said the 747-8Fs will "enable UPS to begin a cascade of aircraft route re-assignments that will add significant air capacity to the company's busiest lanes, thereby optimizing global air network capacity well beyond the impact of adding new cargo jets."

The significant capital investment may also be a sign that UPS does not expect competition from Amazon’s Prime Air, or the global ambitions of rising Chinese integrators, to hinder its future ability to fill large widebody aircraft on international routes. It comes months after FedEx signed a long-term deal with Atlas Air for five 747-400 freighter aircraft during the current peak season.

Read Full Article