FTAI, AEI Team Up To Supply, Support 737-800Fs

FTAI Aviation and Aeronautical Engineers Inc. (AEI) are teaming up to provide Boeing 737-800 converted freighters with bespoke engine builds tailored to cargo utilization patterns, the companies said.

Under the partnership, announced July 7, FTAI will source midlife aircraft and acquire AEI’s conversion kits. Aircraft will be converted within AEI’s network and outfitted with CFM56-7 engines provided by FTAI.

Completed freighters will be sold to operators or FTAI’s Strategic Capital business, which will place them in institutional investor-backed special purpose vehicles (SPVs) and lease them. In either case, long-term engine support deals would provide cargo operators with what they need while supporting FTAI’s goal of extending CFM56 service lives.

“This collaboration adds cargo to FTAI’s CFM56 platform, extending the engine’s lifecycle across passenger, cargo, and power,” said FTAI President David Moreno.

“Combining our conversion expertise with FTAI’s engine maintenance services gives airlines a proven path to freighter capacity built for the long term,” added AEI SVP Robert Convey.

The partnership envisions conducting a significant number of conversions as more 737-800s become available. Aviation Week’s Fleet Discovery data shows a global fleet of about 285 737-800Fs, including 62 that are parked or in long-term storage.

Demand for 737-800F capacity grew quickly in the post-pandemic rebound thanks in large part to a surge in e-commerce. New-aircraft delivery delays kept many midlife aircraft, including 737-800s, in service longer than planned, adding to the freighter-supply bottleneck.

While overall demand has moderated, the need for engines designed for cargo’s lower-utilization and life cycle cost-focused approach remains strong. Some point to the difficulty in sourcing appropriately work-scoped engines as one reason such a high percentage of the 737-800F fleet is parked. FTAI, which specializes in CFM56s, sees its module-swap approach as ideally suited to meet cargo operator needs.

“The Boeing 737-800 is poised to become the workhorse of narrowbody freight, but growth has been constrained by the lack of an engine solution designed for cargo economics,” Merino said. “We can build and maintain lower-cycle engines customized for cargo, enabling FTAI and AEI to deliver aircraft at a significantly lower operating cost.”

FTAI plans to source conversion candidates from the open market and its own portfolio. The recently closed 2025 SPV holds 300 737s and Airbus A320s that are leased out to operators.

The first conversion will begin in the coming weeks, a source with knowledge of the plan tells Aviation Week. Work will be done at AEI network partner Staeco in Shandong province, China.