Jetrader - Summer 2014 - 53

appraisal

Boeing 767-300ER
Olga Razzhivina
ISTAT-Certified Senior Appraiser
ORIEL Consulting
Tel: (UK) 44 771 586 8776
Olga@oriel.aero

Overview and Background

by the extensive delays of that new program. The installation of
winglets also helped to maintain the type's attractiveness for
airlines with very short payback from the fuel savings they generate. It will be probably many more years before the 767 disappears
from the North Atlantic market. Nevertheless, the 767-300ER is
facing increased 787 and A330 replacements. Despite the relatively active market and overall conditions improving, values will
remain under pressure.
The oldest examples see their market values in single figures
while the post-2005 deliveries suffer from the "last-off-the-line"
effect of increased depreciation, not exceeding $65 million.
Monthly lease rates are currently between $150,000 and $520,000
and are likely to follow values in their decline with the ramp-up
in 787 production rates helping to address the program delays.

The Boeing 767-300ER is one of the smaller widebody aircraft
programs, which has enjoyed considerable success and for a period
longer than many would have expected. The -300ER is the stretched
version of the earlier 767-200 variant with the "Extended Range"
capability. Deliveries of the 767-300ER started in February 1988
with American Airlines and peaked in the early 1990s; after 2003
annual production figures dropped to single digits. Although
the 767 production line remains open for freighters and the U.S.
tanker program, it is unlikely more 767-300ERs will be ordered.
The current 767-300ER fleet includes 492 aircraft in service
and 54 parked (nearly 10 percent of the existing fleet), according
to the CAPA Fleets database. The orderbook had only one aircraft
remaining, which was delivered to Air Astana in May 2014. The
767-300ER fleet includes three engine options: General Electric
CF6-80C2, Pratt & Whitney PW4000 and Rolls-Royce RB211-524.
The latter is the least popular with only 32 built. The GE version
has the largest share with 339 aircraft in existence.
During its long production run, the 767-300ER has enjoyed
popularity with all of the airline models, from mainline carriers,
charters and LCCs. Until recent years, it has also been one of the
most attractive widebodies with the leasing community, with 322
(nearly 60 percent) now being managed by lessors.

Freighter Conversion Market
The 767-300ER is an attractive freighter conversion candidate,
complementing the more capable factory-built cargo version.
With FedEx and UPS having already selected the factory-built
version, the market for converted 767F is well-defined. Although
less concerned about the engine choice, the conversion market is interested only in high gross weight, FADEC examples.
Encroaching age restrictions in various jurisdictions are also
a concern, limiting vintages to mid-1990s and younger. From
the economic standpoint, the conversion feedstock has to offer
values in single digits to make it attractive, which is becoming
more attainable.

Market Outlook
The 767's fortunes were prophesied to enter sunset with the
advent of the highly advanced 787 but were unexpectedly buoyed

Boeing 767-300ER Values as of March 2014, US$ millions
Year of
Build
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014

Current Current
Market
Base
Value
Value
7.25
7.75
8.75
10.25
12.00
14.25
17.00
20.00
24.00
28.50
33.50
39.50
46.50
64.67

7.25
7.75
8.75
10.25
12.00
14.25
17.00
20.00
24.00
28.50
33.50
39.50
46.50
64.67

Future Base Values at 1.5% Inflation
2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

6.5
6.9
7.8
9.1
10.8
12.8
15.2
18.0
21.5
25.6
30.1
35.5
41.8
56.9

5.8
6.2
7.0
8.1
9.6
11.4
13.6
16.1
19.4
23.0
27.1
31.9
37.6
44.1

5.1
5.4
6.2
7.3
8.6
10.1
12.2
14.4
17.3
20.6
24.3
28.7
33.8
39.6

4.5
4.8
5.5
6.5
7.6
9.0
10.8
12.8
15.5
18.4
21.7
25.6
30.2
35.4

4.3
4.8
5.7
6.8
8.1
9.7
11.4
13.8
16.4
19.4
22.9
27.0
31.7

3.7
4.3
5.0
6.0
7.1
8.5
10.2
12.2
14.7
17.3
20.4
24.2
28.3

3.8
4.4
5.3
6.3
7.5
9.0
10.9
13.0
15.3
18.2
21.5
25.3

3.3
3.9
4.6
5.6
6.8
8.0
9.7
11.5
13.6
16.1
19.2
22.4

3.4
4.1
4.9
5.9
7.1
8.6
10.2
12.1
14.3
16.9
20.0

3.0
3.6
4.3
5.2
6.2
7.5
9.1
10.7
12.6
15.0
17.6

The aircraft values stated herein are the product and the property of independent third-party sources, and ISTAT neither approves nor endorses the
information contained herein or the use thereof for any purpose whatsoever.

Aircraft specifications: CF6-80C2B6F engines, 407,000lb MTOW
Maintenance assumption: new aircraft - Full-Life; 1 year old 75% of Full-Life; thereafter Half-Life.
All values are expressed in US dollar millions.
Jetrader * Summer 2014 53

Jetrader - Summer 2014

Table of Contents for the Digital Edition of Jetrader - Summer 2014