Boeing in line for large freighter order

July 8, 2015, © Leeham Co.: Boeing may be close to a large cargo airplane deal that could solve several near-term problems, Leeham News and Comment has learned.

It’s not the 747-8F and the 777F may play only a small part of the transaction.

The plane is the venerable 767-300F, the old lady in the Boeing line up that is chugging along with just 35 in backlog, all for package carrier FedEx.

According to Market Intelligence, FDX is likely to order as many as 50 more 767-300Fs and perhaps up to 10 777Fs, a plane it has previously deferred.

FedEx has a board meeting this month in Seattle.

FedEx has 45 Boeing MD-11s in operation, according AirlinesFleet.net. Many are in domestic service, where the MD-11 is ill-suited for operations. It also has a large number of Airbus A300-600s and Boeing MD-10s that are aging, according to Planespotter.net.

For Boeing, an order for the 767-300F will in some respects be more important than one for the 777F.

Boeing continues to struggle to sell the 777F, with pricing declining and other concessions being offered to entice sales. Former CEO Jim McNerney has been unwilling to acknowledge a production rate cut will be needed, but new CEO Dennis Muilenburg may be more willing to face up to market realities. With cash flow already under pressure from declining 777 sales and price cuts, a large order for the 767-300F will be a welcome boost. It also will likely lead to an increase in 767 production rates as 777 rates inevitably come down.

 

42 Comments on “Boeing in line for large freighter order

  1. FedEx has ordered new-built A300-600 at a time when the aircraft was clearly outdated. I think they hunt for a good price. For the service they do the B767F is a very good aircraft. Only weak spot if the fuselage diameter, an A310 is actually better suited in some respects.
    The B777F also come at very good prices, and the production gap means a window of opportunity that closes when B777X starts production.

  2. Being able to carry 58t of cargo 6000km is not to be sneezed at.
    Its hard to say which plane they are replacing but the MD10/MD11 would be a good bet

    • MD10 yes, MD11 no.

      they picked up 3 last year, seems to work still for them

  3. Clearly Fedex does not believe that fuel prices are coming back up. A cheaper (but less efficient) airplane is not something one invests in when fuel is the primary concern.

    • My understanding is that fuel prices have less impact on Fedex, because they don´t fly as many hours per day as a passengers airliners.
      The cost of the plane has a bigger impact because they have to spread it on less flight hours

      • If you can’t fill the bird then its not cheaper

        And what are the choices, A330F? Too big.

        ergo a pretty efficient aircraft (767) and size suits

        • Where did I say anything in favor of the A330F or against the 767?
          I was just pointing out that “Loony Tea Party” was reading the “leaves too hard” concluding that the agreement was pointing out a long term trend in fuel prices…

  4. Well, for FedEx’ packages the fuselage diameter may not be the show stopper and A330 may has the same problem as 777F “too much of an aircraft”. However, Airbus could consider a kind of A330-300 “Package Market Freighter”? Any rumours on that?

  5. For Fedex a down to earth purchase. The price no doubt reflecting how much Boeing needs it to keep the line alive amid Tanker adventures.

    Other news, Airbus this week patented a smaller more flexible twin deck twin. By the looks of the it a high capacity more flexible MoM twin. http://images3.freshpatents.com/pdf/US20150166166A1.pdf

    An intra US / Europe / Asia regional kind of 300-400 seater that can do LD3s/ pallets too. Finally a 747-400D replacement!

    http://www.airlinereporter.com/2014/04/hello-goodbye/

    • not picking on Airbus here, but wondering how the heck something like this gets a patent

      exactly what the heck is patentable about that design? there is nothing original or non-obvious to a skilled practitioner (which is what is required for something to be patentable)

      an aircraft that has the passenger deck low to the ground to facilitate passenger loading without ground support? see: every turboprop, DC9, old 737s, business jet

      an aircraft where the wing structure doesn’t impinge into the passenger or cargo area? see every high wing turboprop regional, and every small/medium Bizjet without underfloor cargo.

      double decker? hell, shall we go back to the era of seaplanes?

      movable partition? every combi ever..

      • @ bilbo

        I was laughing at that patent application myself. It looks like they’re trying to patent breathing air! 🙂

      • The stupidity of the patent system is well renowned.

        It desperately, desperately needs a total overhaul.

        I’d say its no exaggeration to state that people **are** dying due to the prevention of research and development of innovative technology solely by the archaic nature of the patent system worldwide, but particularly the US patent office.

      • This is not a patent but just an application with a single claim (claim 1 page 13 and 13 dependants). In addition to launching the process the application, it establishes a priority date.
        It may be that the claim has some merit and may be granted, but prior art should be checked before confirming (and think about CRJ, IL-86…jus from the top of my mind).

        Don’t forget that patent are fences: they protect you in several ways, the most obvious one being not copied.
        But a less understood use of patent is the one that consists of slowing (or even stoping) the R&D from your competitors; this by claiming things that they may work on; especially when you have no intention to pursuit the application as it will become prior art (hence no longer patentable by your competitors).

  6. Thanks for derailing the topic with injections of non related information. =)

    Back to topic. I know that FX had or has flying spares and they flew them with the A310’s. By the looks of things, it looks like they will have a streamlined fleet with planes similar in size the 763 and the 757. How will that affect the efficiency of using other models in place of the retired A310’s?

  7. A correction/clarification…

    FedEx currently owns B777-200Fs, so not sure how the author can claim they deferred that aircraft… I have been aboard many… If the author is referring a deferring an order and not aircraft type, it might make sense. However, my interpertation is on the order of aircraft type…

    FedEx has a history of closing down a line with a large freighter order, such as the B727-200Fs, so nothing unusual… The A300s and MD10/11s are all long in the tooth, so time to go all twins… As far as fuselage width, for the most part irrelevant vs the fuel savings… You can max the width with different container types or just design a new one if needed… Mark z

    • @Mark FDX does indeed operate a number of 777Fs but it also deferred a number to later schedule.

      • Yep, the 767s came up and they seemed to suddenly realize how bad the MD10 was economically.

        Still seem to think the MD11 works ok.

        Curious if the new 767s will have the 2C flight deck?

      • Thanks for clarifying… Must have been the way I read it… Good article with some intelligent discussion… Mark z

  8. “For Boeing, an order for the 767-300F will in some respects be more important than one for the 777F.”

    Scott,

    Can you elaborate on this? Given that Boeing has frames yet to build on the 767 plus all the Tankers to come it seems the worst case there would be building white tails for the Air Force and doing the conversions later. More expensive yes but keeping the 777 line rolling until the X comes on line would seem to be even more important.

    • @121: The tanker program is in a forward loss position, it’s late and the first production deliveries are in 2017 (if I remember right). It is too soon to say if the production tankers will have a forward loss as well. The tanmker program is all cash out-flow now and will be for years to come.

      A 767 order, especially of this magnitude (assuming the market intel is correct) will involve an immediate cash in-flow (down payments) and progress payments. Given that Boeing is accelerating advances and PDPs to generate cash to pay for its $2.5bn/yr stock repurchase program and higher dividends, it’s also possible FDX (if this is who it is) might buy “x” number of airplanes for cash, in advance, in return for various considerations. 50 767s are worth more than 10 777Fs.

      The tankers and the commercial 767s are produced on the same line.

      The only white tails Boeing has are 747-8s.

  9. Will the new 767F use upgrades of the new version of the Tanker, or will its systems, engines, cockpit be of past 767F’s?

    • 767Fs will be common to the commercial models, not the tanker.

  10. Pingback: FedEx to place massive freighter order? | Cargo Facts

  11. Is it Boeing intent to sell the 2C as a commercial model?

    Flight program has both military and civilian versions if I am following this right.

    Seems odd not to have the 300F up to the same production standard as the 2C but then………

  12. The 767-2C is based on a 767-200 fuselage. The main deck cargo door of the KC-46 is very close to the engine nacelle.

    The 767-200 offers less space than the 767-300 and FedEx prefers cheap aircraft over new cockpits.

    • That I get, but the 2C ius also flhying in a civialin confiation (or so I understand)

      It would seem that that would get done in the 300F as well, partialy with cargo there should not be much system issues.

      It seems Boeing intends to sell the 2C in civilian market but maybe that’s wrong.

      If not going to have them all the same it just seems odd and you get into the issue of supporting legacy equipment down the road (which I assume is why the AF wanted the 787 cockpit in the 2C)

      • According to my knowledge the 2C is the civil brother of the “Frankentanker”. With -300 wings and -400 flaps but with the same old engines.

        I so not know how the cockpit is related to the messed up wiring for KC-46.

        Just a new cockpit could be worth the effort but no new cockpit is cheaper.

  13. Here’s a chance for Boeing to offer a 767MAX with a minimum of upgrades, new engines, weight loss plan, and perhaps some aerodynamic improvements, but no new wings. With the Fed-Ex order keeping the line going, perhaps some 200-300 passenger models could be sold regaining some of the ground lost to Airbus and the A330. A 767MAX could fill the gap between the 777 and the 787, and be a replacement for the 757. The 737-9MAX is not going to cut it as a 757 replacement.

    • let it go. the 767 MAX will never happen.

      MoM requires single aisle economics and preferably C gate compatibility to be viable, 2 class/250 seats, 5000nm range, ~115 ton MTOW at most.

      a canard wing single aisle or low/wide oval 8 wide twin design with over wing engines and a mid-ships main door for passenger efficiency with LD-45s for cargo would fit the bill nicely (would actually look a bit like the mythical sonic cruiser) but is probably too radical a design departure for McBoeing.

      what I expect to see is a 737-300 length/a320 diameter aluminum or panelized CF tube with a conventional CF wing with long second gen folding wingtips that are C-gate max on the ground and extend to D or greater on the runway, a lot of passive laminar flow shaping. possibly overwing engines (a-la hondajet) to move the CG and therefore MLG rearward allowing shorter lighter and lower to the ground landing gear and fuselage.

  14. Pingback: Fedex Readies Large Boeing Freighter Order

  15. Just does not seem likely, if so they would have done that with the tanker contract and spread it out. Low risk and all that.

    • Sane for Airbus. With an MRTT-NEO surprise Airbus could have been the winner against the KC-46.

      • I don’t think so. MRTTneo would be even more expensive than MRTTceo. And besides, the USAF specifications were tailored for the 767, just like they had been tailored for the 330 the first time around. The dice were loaded from the start in both Round One and Round Two. In the end the only winner will have been Washington; everyone else lost: Airbus, Boeing (Pyrrhic victory) and, more importantly, the USAF.

  16. A FedEx large 763F commitment is not to be confused with any serious, late and unexpected revival of the 767 family as such but rather – if need be – a confirmation of the isolation, let’s venture the term “in-breeding”, of FedEx’s operational model, establishing a world of itself, independantly of what’s going on elsewhere in the market, no ties, no LD2 interlining, no connecting headaches… the downside of their model is that whatever they do on the fleet-side bears no repercussion upon the fleet planning of any next-in-kin operators, because there aren’t any.

    • I would agree that FedEx marches to their own beat, however, I would not term it as ‘in-breeding’… Having worked for several pax airlines prior to spending time @ FedEx, I can categorically state this is an airline that thinks for itself, unlike the vanilla state of affairs with the industry (pax & freight) itself… I can recall times at the pax airlines seeing demand wane and management waiting for the other guy to make a move… The consequences, deep job and route cuts that could have been avoided by early proactive actions… But I regress…

      You can see the FedEx fleet model evolving from the early days of expansion and the need to get the cheapest aircraft quickly, to the current day mature market model requiring efficiency of aircraft type commonality and fuel consumption… Extending the B767 benefits Boeing and FedEx, but you are correct @Frequent Traveller, the only viable player to piggy-back would be UPS… However, history has taught us many times that disruption is just around the corner and we may see a new player… Cheers…

  17. My understanding is that this deal would likely be more favourable to FedEx that Boeing. Cargo Facts says that FedEx has been working on this for about a year and could not reach an agreement with Boeing on price. So I can only imagine that Boeing’s margins will be slim. It probably is still a good deal for Boeing though because of the huge quantity. On the other hand Boeing need fat margins more than ever in order to sustain their reckless business model.

  18. Excluding the 737F (which disqualifies itself for lack of underbelly CLS), the 767F is the de facto the ONLY vector available in the market as a newbuild, taggable as a “feeder freighter”. There is plentiful of intermediate WB freight vectors (dedicated and belly-freighters), but there is a lack of proper feeder freighters for hub’nspoke pick-up and final delivery service from/to the world’s many long-range freight hubs popping up here and there … Airbus ought to “cultiver son jardin” (Voltaire dans Candide) in respect of this segment, because they could easily place 150-200 F21QR (and/or F22QR) in the short term. At re-marketing prices currently prevailing, an end-of-life A321 (with 5-10 years of additional life potential till scrapyard + fees for P2F conversion (6 to 8 M$, if you can find a slot with the conversion people ???), given the costly maintenance challenge of end-of-life types (vendor equipment spares, engine spares etc) ends up costing much more than an F21QR NEO newbuild with a full worklife expectation of 35 years, correctly priced and financed … whence the message to world’s freighter operators in 2011 … which was not heard :
    http://twinaislefeeders.wix.com/quickrotation#!new-strategy-f2xqr

  19. Pingback: FedEx to Purchase 50 Boeing 767-300 Freighters

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