Aircraft Asset Assessment The MD11

Market Presence. In terms of historical values of the MD11, initially the outlook appeared promising, resulting more from the overall perceptions regarding widebodies rather than a judgment concerning the actual type. The initial problems regarding range resulted in some concern although it was appreciated...

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Market Presence. In terms of historical values of the MD11, initially the outlook appeared promising, resulting more from the overall perceptions regarding widebodies rather than a judgment concerning the actual type. The initial problems regarding range resulted in some concern although it was appreciated that most new aircraft have their teething problems - note the initial apparent dissatisfaction of United with the "service ready" B777, a type that is now perceived to be among the most versatile and popular of widebodies. However, three quarters of the fleet of nearly 200 MD11s, are now in a freighter role with the probability that another 20-30 will be converted in the coming years. The switch to the freighter role is more a consequence of on-going problems as a passenger aircraft than exceptional demand as a freighter though this dynamic has seemingly changed during the course of this decade. Values of passenger aircraft have tumbled for at least nine years, if not longer, due to the availability of more versatile products and family groupings. But now that there exists considerable demand for the freighter, the decline in passenger values has been halted.

Market Outlook. The prospects for values of the MD11 in a passenger role remain forlorn. As a freighter the future holds out far greater promise. The number of airlines with the route structure, resources and density of traffic capable of supporting the MD11 are few and those wishing to acquire the MD11 for mainstream passenger use are even fewer. The MD11 has to compete with relatively newer aircraft such as the B777-200ER. The A340-500 and B777-200LR are also viewed as direct replacements for the MD11, even more so than the A340-300. The future of the MD11, therefore, lies firmly as a freighter with the liklihood of further marginalization for the passenger examples.