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29. August 2020

Exclusive - LH Cargo considers prolonging lifespan of MD-11Fs

The day for the farewell of the last MD-11F belonging to Lufthansa Cargo’s fleet was already determined: December 31, 2020. However, there are mounting indications that the McDonnel Douglas produced aircraft’s exit might be pushed back.

Operating the 6 MD-11Fs beyond December 2020 might pay off for LH Cargo  -  photo: CFG / hs
Operating the 6 MD-11Fs beyond December 2020 might pay off for LH Cargo - photo: CFG / hs

For how long - if months or even more - is a matter of speculation. LH Cargo keeps tight lipped when asked about the fate of their remaining sub-fleet of 6 MD-11Fs, down from a total of 18 units years ago. A company speaker refused to comment but conversely did not explicitly deny assumptions either that the freighters might be operated beyond 1 January next year.
 
Freighters are becoming flying banks
The speculations about the aircraft’s fate were fueled by latest traffic data, documenting a considerable gap between transport demand and supply, driving rates up and hugely benefitting cargo carriers. “Airlines with freighters in their fleets can expect high capacity utilization in the next 3 to 4 years and healthy margins,” predicted Research Analyst Daniel Roeska of asset management company Sanford C. Bernstein at an event organized and orchestrated last Wednesday (26AUG20) by Frankfurt’s Air Cargo Community. Deliveries and P2F conversions will not fully compensate the lack of belly-hold capacity short-term specifically on long haul routes caused by corona-driven travel restrictions, he stated.
 
Widening gap between demand and supply
The bottleneck in main deck capacity could become dramatic once Covid-19 vaccines are available, presumably in Q1, 2021, which must then be shipped as quickly as possible from production sites to their destinations, i.e. by air freight. Experts estimate that this will require capacities of between 8,000 to 12,000 Boeing 747 freighters.  
Given these figures an enormous shortage of uplift capacity is becoming apparent in the coming months since there are only roughly 2,000 freighter aircraft from different manufacturers in commercial operation – globally.
Seen from this angle, keeping the MD-11Fs in their fleet until demand drops down again would make a lot of sense for LH Cargo. Recognizing the benefits is not rocket science when looking at the exceptionally low fuel prices coupled with high freight rates, which are likely to even increase once a Covid-19 vaccine becomes available and mass shipping begins.

Bernstein analyst Daniel Roeska predicts an extended market tightness in air cargo, specifically on long-haul routes  -  photo: CFG / hs
Bernstein analyst Daniel Roeska predicts an extended market tightness in air cargo, specifically on long-haul routes - photo: CFG / hs

2 more Triple Seven freighters will join LH Cargo’s fleet
Meanwhile, LH Cargo announced that the main deck capacity offered to the market will be upped by 2 additional B777 production freighters (number 8 and 9), with the first plane arriving within the next couple of days in Frankfurt, followed by the second unit that is expected to join LH Cargo’s fleet either in September or October this year. Two more B777Fs are flying in AeroLogic colors but are fully utilized by LH Cargo. Finally, AeroLogic’s JV partners DHL Express and LH Cargo share the capacity of 2 other Triple Sevens displaying the logo of 3S (IATA Code).
Looking back, it is astonishing that Lufthansa Cargo did not have to make any cutbacks in its freighter program despite strong internal opposition. Main counterpart was Group CFO Ulrik Svensson who saw no need for any airline belonging to the LH Group to operate all-cargo aircraft. Instead, he pleaded for the British Airways model based on passenger aircraft offering lower deck capacity, supplemented by capacity sharing models with other airlines, in this case Qatar Cargo.
Mr. Svensson left Lufthansa last April because of health issues.  

Heiner Siegmund


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Comments: 1
  • #1

    Rayhan ahmed (Monday, 31 August 2020 00:31)

    Lufthansa 6 MD11’s are highly needed
    For the influx of the COVID 19
    Vaccines and it would be ideal advise
    To keep these MD11’s in operation
    Past 2022.
    During this period maintenance plans
    Should be reviewed at min cost
    Past 2022 by retiring the first MD11
    That requires a D check and operating
    The rest until 2022 and periodically
    Retiring them according to D check that
    Requires this check which would not
    Be economical wise for a 30 yrs Old
    Aircraft .


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