en.Wedoany.com Reported - FTAI Aviation and Aeronautical Engineers Inc. (AEI) have announced a partnership to jointly launch a Boeing 737-800 converted freighter, along with a customized engine manufacturing solution tailored for cargo operations.
Under the agreement announced on July 7, FTAI will be responsible for procuring mid-life aircraft and acquiring AEI's conversion kits. The aircraft will be converted within AEI's partner network and equipped with CFM56-7 engines provided by FTAI. The converted freighters will be sold to operators or acquired by FTAI's strategic capital business unit and placed into special purpose vehicles (SPVs) backed by institutional investors for leasing. Whether sold or leased, long-term engine support agreements will provide cargo operators with the necessary services while supporting FTAI's goal of extending the service life of CFM56 engines.
David Moreno, President of FTAI, stated that this partnership integrates cargo operations into FTAI's CFM56 platform, enabling engine life cycles to span passenger, cargo, and power generation sectors. Robert Convey, Senior Vice President of AEI, added that combining AEI's conversion expertise with FTAI's engine maintenance services provides airlines with a proven long-term freighter capacity pathway.
The partnership plans to conduct a significant number of conversions as more 737-800 aircraft become available. According to Aviation Week's Fleet Discovery data, the global fleet currently has approximately 285 737-800Fs, with 62 in storage or long-term parking. During the post-pandemic economic recovery, demand for 737-800F capacity surged due to the e-commerce boom. Delays in new aircraft deliveries have extended the service life of many mid-life aircraft, including the 737-800, beyond original plans, further exacerbating the freighter supply bottleneck.
Although overall demand has moderated, demand for engines tailored to cargo operations' low utilization rates and lifecycle cost focus remains strong. Analysts point out that difficulty in obtaining engines with suitable work scopes is one reason for the high parking ratio of the 737-800F fleet. FTAI, which focuses on CFM56 engines, believes its module exchange approach is well-suited to meet cargo operators' needs. Merino noted that the Boeing 737-800 is expected to become the mainstay of narrowbody freighters, but growth has been constrained by the lack of engine solutions designed for cargo economics. FTAI can build and maintain low-cycle engines customized for cargo, enabling FTAI and AEI to deliver aircraft at significantly reduced operating costs.
FTAI plans to source conversion candidates from the open market and its own portfolio. The recently concluded 2025 SPV holds 300 737 and Airbus A320 aircraft, which have been leased to operators. According to sources familiar with the matter who spoke to Aviation Week, the first conversion will begin in the coming weeks, with work to be carried out at Staeco, an AEI network partner located in Shandong Province, China.
