Source: Boeing (Media Center / Gallery)
Type : B777
Model : B777-300ER
Family : Wide-body
Airframe Manufacturer : Boeing
Model Launch: 2004
No of Engines : 2
Engine Type – Model : GE90-115B
Seat Capacity : 392 in 2 Class Configuration
Weight and Payload :351,550 Kgs Max Take Off Weight (MTOW)
Range Capacity : 7085 nm / 13,120 km
Appraiser’s Opinion
The B777-300ER has been the most popular asset type in the B777 legacy program with 819 units out of total 1276 delivered across the entire family. More than 60% of the B777-200 variants (B777-200/200LR/200ER) and the B777-300 have already been retired. However, the majority of the B777-300ER fleet continues to be in active service with just over 10% of the fleet having been retired so far. This continued demand can be attributed to the aircraft’s: route flexibility; long range capability; mature engine program; long-haul suitable passenger cabin, and significant belly cargo capacity.
However, with the introduction of B777X as well as long term confirmed demand for B787 family aircraft, Boeing has phased out the B777-300ER from production. There are 353 unfilled orders for the B777X and 460 unfilled orders for the B787-8/-9 assets compared with only 6 unfilled orders for B777-300ER. This is indicative of the B777-300ER being phased out to make way for the B777X by end of the current decade.
In the appraiser's opinion, the B777-300ER has a relatively positive current market demand with Tier 1 operators. The global fleet composition needs careful analysis in this regard to understand and predict the potential future demand for this aircraft. As the statistics on the right depict, only 15% of the global fleet is currently over 14 years old; prime candidates for retirement are relatively low in number. With more than 60% of the global fleet being owned, transitions of assets from Tier 1 to Tier 2 operators would be relatively low in number. This also means that secondary demand for this aircraft type would be soft and hence negatively impact the market value of the asset as compared with the base value.
In addition, the increasing popularity of the B787-9 and A350-900 is expected to have an impact on the future demand for used B777-300ER amongst emerging Tier 2 operators in the long-haul market. The cost of cabin refurbishment and aircraft rebranding is significantly high and is less likely to be viable for Tier 1 as well as Tier 2 airlines. This may lead to a possibility of a flux in demand at the end of the current decade when B777X, B787-9, A350-900 and A350-1000 reach critical mass in the global operations. These aircraft programs are also technologically more advanced and predicted to offer significant operational and commercial advantages. At end of the decade, it would prove difficult to place the majority of the mid-age B777-300ER fleet (8-14 years old) on secondary leases, increasing the likelihood of retirement and a decline in market value. These factors are important considerations for future value projections and must be closely watched. Overall, whilst the aircraft has proved to be a worthy workhorse for the long-haul market, the future of the long-haul market appears to hinge on the success of the newer aircraft types. The phase out of the B777-300ER seems inevitable and might only get extended through increased demand from the Freighter market, from which signs continue to emerge.
Value Projections:
Disclaimer:
The opinions and commentary mentioned is solely that of the author. The data used to derive such opinions is sourced from designated sources through proper means of subscriptions. For fin-S demo or certified appraisal report(s), please contact support@sparta.aero or valuation@acumen.aero respectively.
About the author:
Ameya Gore is a seasoned industry veteran with 17+ years of experience in diverse leadership roles. Along with being CTO — Digital at Acumen Aviation, a Dublin based Aviation Asset Management firm, Ameya is also a Certified Senior Appraiser and provides commercial valuation services to aviation customers. Previously, he has held other senior leadership positions in Technical and Asset Management and Data Management leading global operations, off-shore services and several mission-critical projects across the world.
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