Monday, March 27, 2017

NCA cancels remaining 747-8F orders

Japan-based NYK Group, parent of Nippon Cargo Airlines (NCA), said it reached an agreement with Boeing to cancel NCA’s two remaining orders for 747-8 freighters.

NCA was a launch customer for the 747-8F, placing an order for eight units in November 2005, and upping its total to fourteen in early 2007. However, by the time the carrier took delivery of the first of those fourteen freighters in July 2012, the air freight world was a much different place. Demand growth had disappeared, and not only was NCA (like carriers everywhere) struggling to fill its freighters, the market for used freighters had also disappeared, making its plan to sell or lease out its 747-400Fs as the -8Fs entered the fleet more difficult.

So it was not surprising that, in September 2015, NCA, which had by then taken delivery of eight 747-8Fs, cancelled four of its remaining six orders.

And now, eighteen months later, with the carrier having taken no more deliveries, parent NYK Group has posted a notice on its investor relations site saying: “NCA has come to an agreement with Boeing on the cancellation of two 747-8F freighter aircraft.” In a nutshell, NCA has come to the conclusion that, in today’s air freight world, it cannot justify additional freighters.

The cancellation leaves Boeing with a 747-8F backlog of thirty units — fifteen from Volga Dnepr Group (for subsidiary AirBridgeCargo Airlines), fourteen from UPS, and one from Silk Way West Airlines. On the passenger side of the program, however, the news is not so good. Of the forty-eight orders Boeing has taken for the 747-8I, it has delivered forty-one, leaving it with a nominal backlog of seven units. But four of those seven were ordered by now-bankrupt Russian carrier Transaero, so the real backlog is three (all for Korean Air).

This leaves a total backlog of thirty-three, of which at least a few have already been built and rolled out. At its current production rate of six per year, Boeing still has perhaps four years worth of production in its 747-8 backlog, so it is hardly time for panic, but the clock is ticking on the program.

Regardless of the order situation, the 747-8F is a beautiful and impressive airplane.

(David Harris - Cargo Facts)

No comments: