ST Engineering Straddles Value Chain With A320P2F Lease Deals

ST Engineering's portfolio of freighter aircraft includes the A320P2F and A321P2F as narrowbody options.
Credit: ST Engineering

The world’s newest freighter conversions, the Airbus A320P2F and A321P2F, are set to start operating this year with Indian carrier Pradhaan Air Express and Malaysian airline Raha Airways.

Pradhaan aims to operate two leased A320P2Fs by year-end, while Raya will take an A321P2F, part of a lease deal for two A320P2Fs and two A321P2Fs, in the final quarter.

“Once converted, each A321P2F will offer 27 tons while each A320P2F will offer 21 [metric tons], effectively increasing Raya Airways’ combined payload by up to 96 [metric tons],” said Raya’s chief commercial officer, Hidayat Rahim.

Pradhaan’s two A320P2Fs, meanwhile, are part of a group of five that UAE-headquartered Vaayu Group agreed to lease from ST Engineering in February.

Aside from the A320 family’s debut in the cargo market, the other interesting aspect of both deals is ST Engineering’s status as both conversion center (in partnership with Elbe Flugzeugwerke) and lessor of the nine converted freighters—positioning that allows it to straddle two of the most lucrative steps of the booming air cargo market’s value chain.

“Our unique leasing solutions, such as the bundling of aircraft leasing with MRO services, when combined with in-house developed P2F programs and top-notch conversion standards, offer operators best-in-class economics and unparalleled levels in reliability,” said Yip Hin Meng, executive vice president and head of aviation asset management at ST Engineering.

ST Engineering’s aviation asset management business is an aircraft and engine lessor with core competencies in deal origination, financing, securitization, lease management, technical asset management, re-marketing and repossession. 

Its portfolio of freighter aircraft includes the A320P2F and A321P2F as narrowbody options, and the A330P2F as the widebody option. In addition to leasing solutions, ST Engineering provides total lifecycle asset management solutions.

These include turnkey aircraft and cabin reconfiguration services, aircraft and engine MRO as well as freighter conversion. 

Alex Derber

Alex Derber, a UK-based aviation journalist, is editor of the Engine Yearbook and a contributor to Aviation Week and Inside MRO.