SINGAPORE—Singapore Technologies Engineering has finalized a deal for five Airbus A320P2F passenger-to-freighter aircraft with Emirati-lessor Vaayu Group, converting a letter of commitment signed in 2021 to a lease agreement.
The world’s first converted A320 freighter will be delivered to Nairobi-based Astral Aviation, which will lease two. ST Engineering said the aircraft, which awaits certification after its first flight in December, is expected to be placed on lease in Q2 2022.
“The upside of the pandemic was an increase of sales in e-commerce space. For freighters and cargo handlers worldwide, this was unexpected. We saw this coming. We simply fast-tracked the process; from conception to a reality in this A320 P2F program,” Vaayu Group chairman and president Emad Al Monayea said.
Speaking to ATW before the Singapore Airshow, ST Engineering Commercial Aerospace president Jeffrey Lam said the company was looking to double the value of its assets under management to $2 billion by 2026.
Lam said he was bullish about the long-term demand for converted freighters because of the growth in e-commerce and global supply chain disruption. While the company is looking to expand beyond the 13 conversion lines across six global sites, Lam said they would be selecting partners carefully to prevent a bubble in the segment.
“We believe that certainly the upswing is going to stabilize and moderate at some point based on the aircraft fleets and passenger aircraft fleet retirements. We are seeing very strong uptake which will moderate and come to a sustainable but fairly strong level of demand,” he said.
Lam noted that restrictions in the movement of people related to the pandemic have also made it hard for ST Engineering to hire new technicians to work on the P2F program. He said that inflation in wages because of labor and skills shortage remained a concern.
Related Content
