Garuda Indonesia and lessor GE Capital Aviation Services (Gecas) have entered into a lease agreement for two B737-800 Boeing converted freighters (BCFs). According to an Oct. 17 announcement, the passenger-converted aircraft are scheduled to be phased into the Indonesian flag carrier's fleet in mid-2020 and will provide additional capacity to Cargo Garuda Indonesia, the carrier's dedicated strategic business unit. The two aircraft will add to three freighters currently in service.
Cargo volumes emanating from Indonesia are robust. According to the Indonesian Logistics Association, the logistics sector is estimated to experience an increase of 12% in 2019, well below the annual growth of the e-commerce sector, which according to Bank Indonesia, could jump by 100% to 150% this year.
The announcement follows by one day an announcement by Gecas and Israel Aerospace Industries (IAI) addressing the launch of the B777-300ERSF (extended range special freighter), and establishment of a passenger-to-freighter conversion program. Dubbed "The Big Twin," denoting its status as the largest-ever twin-engined freighter, the initiative is jointly funded by both parties.
With agreements signed in July and a prototype aircraft to be provided by Gecas, the B777-300ERSF supplemental type certificate (STC) development program has been launched.
As launch customer and co-funder of the program, Gecas will commit to 15 firm orders and has 15 additional options for the B777-300ERSF, with feedstock provided from Gecas' owned portfolio to be committed to the program, including the prototype aircraft.
Conversion of initial aircraft is expected to take place in Tel Aviv with further conversion lines contemplated in locations outside of Israel, beginning in 2023. The program also will see IAI enter into conversion agreements for the B777-300ERSF directly with airlines as well as other lessors around the world.
The B777-300ERSF STC development and prototype conversion is estimated to take over three years from start of the program to achieving U.K. CAA International (CAAi) and U.S. Federal Aviation Administration approval. Subsequent aircraft are expected to average four to five months to convert.
As the next generation of long-haul, large-capacity freighter aircraft, the B777-300ERSF aircraft features 25% more capacity than current smaller twin-engined long-haul freighters and Gecas anticipates that the aircraft will achieve up to 21% lower fuel burn per ton than aging four-engine freighters. Gecas maintains that the B777-300ERSF is especially suited for express and e-commerce operations.
This new agreement marks a continuation of a 20-plus-year partnership between Gecas and IAI. The Israeli partner's experience in conversion programs includes the B747, B767, B737NG and the B737 Classic. IAI has completed more than 70 conversions for Gecas, involving B747, B767 and B737 aircraft.
Gecas, a major player in the aircraft leasing sector for over 50 years, is in the midst of winding down its activities. Parent company GE Capital's overall strategy is to become smaller, with a commitment to reduce assets by $10 billion in 2019. GE Capital has targeted shrinking its balance sheet, achieving a debt-to-equity ratio of less than four times by 2020.
In line with this strategy, GE Capital announced in late August that private equity powerhouse Apollo Global Management and financial services company Athene Holding had agreed to purchase PK AirFinance, an aviation lending business, from Gecas for an undisclosed amount. In connection with this transaction, Apollo will acquire the PK AirFinance aircraft lending platform and Athene will acquire PK AirFinance's existing loan portfolio.
Gecas places freighter conversions with Garuda
Garuda Indonesia and lessor GE Capital Aviation Services (Gecas) have entered into a lease agreement for two B737-800 Boeing converted freighters (BCFs). According to an Oct. 17 announcement, the passenger-converted aircraft are scheduled to be phased into the Indonesian flag carrier's fleet in mid-2020 and will provide additional capacity to Cargo Garuda Indonesia, the carrier's dedicated strategic business unit. The two aircraft will add to three freighters currently in service.
Cargo volumes emanating from Indonesia are robust. According to the Indonesian Logistics Association, the logistics sector is estimated to experience an increase of 12% in 2019, well below the annual growth of the e-commerce sector, which according to Bank Indonesia, could jump by 100% to 150% this year.
The announcement follows by one day an announcement by Gecas and Israel Aerospace Industries (IAI) addressing the launch of the B777-300ERSF (extended range special freighter), and establishment of a passenger-to-freighter conversion program. Dubbed "The Big Twin," denoting its status as the largest-ever twin-engined freighter, the initiative is jointly funded by both parties.
With agreements signed in July and a prototype aircraft to be provided by Gecas, the B777-300ERSF supplemental type certificate (STC) development program has been launched.
As launch customer and co-funder of the program, Gecas will commit to 15 firm orders and has 15 additional options for the B777-300ERSF, with feedstock provided from Gecas' owned portfolio to be committed to the program, including the prototype aircraft.
Conversion of initial aircraft is expected to take place in Tel Aviv with further conversion lines contemplated in locations outside of Israel, beginning in 2023. The program also will see IAI enter into conversion agreements for the B777-300ERSF directly with airlines as well as other lessors around the world.
The B777-300ERSF STC development and prototype conversion is estimated to take over three years from start of the program to achieving U.K. CAA International (CAAi) and U.S. Federal Aviation Administration approval. Subsequent aircraft are expected to average four to five months to convert.
As the next generation of long-haul, large-capacity freighter aircraft, the B777-300ERSF aircraft features 25% more capacity than current smaller twin-engined long-haul freighters and Gecas anticipates that the aircraft will achieve up to 21% lower fuel burn per ton than aging four-engine freighters. Gecas maintains that the B777-300ERSF is especially suited for express and e-commerce operations.
This new agreement marks a continuation of a 20-plus-year partnership between Gecas and IAI. The Israeli partner's experience in conversion programs includes the B747, B767, B737NG and the B737 Classic. IAI has completed more than 70 conversions for Gecas, involving B747, B767 and B737 aircraft.
Gecas, a major player in the aircraft leasing sector for over 50 years, is in the midst of winding down its activities. Parent company GE Capital's overall strategy is to become smaller, with a commitment to reduce assets by $10 billion in 2019. GE Capital has targeted shrinking its balance sheet, achieving a debt-to-equity ratio of less than four times by 2020.
In line with this strategy, GE Capital announced in late August that private equity powerhouse Apollo Global Management and financial services company Athene Holding had agreed to purchase PK AirFinance, an aviation lending business, from Gecas for an undisclosed amount. In connection with this transaction, Apollo will acquire the PK AirFinance aircraft lending platform and Athene will acquire PK AirFinance's existing loan portfolio.
Image Sourced from Pixabay
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