Aircraft Asset Assessment

Market Presence. The B737-400 is clearly showing its age in terms of efficiency, specification and market orientation even more so in the context of the Covid Event. Structure and systems can be traced back to the 1960s while performance and capacity reflect the 1980s. However, partly perhaps because of its heritage, the structure remains reasonably robust and provides uncompromising service to a wide range of operators everyday of the year. The limited payload/range performance, combined with a maximum 169 seating capacity, represent the major drawbacks to the B737-400. Operators now demand at least 180 seats and a 3,000nm range capability (though the emphasis is on payload rather than absolute range). Only with a high MTOW and extra fuel tanks can the –400 even reach 2,500nm. Noise levels could be reduced by the installation of optional acoustic panels and Boeing/CFM56 offered a major upgrade to the CFM56-3 series at a list price of $1 million per engine. Southwest was the launch customer for the upgrade which also provided greater on wing time. The A320 and the B737-800 represent the key replacement to the B737-400 but even these are too are being replaced by new products underlining the vulnerability of the B737 Classic. The problem for values of the -400 is that the market for even the engines has experienced considerable weakness. With the retirement of so many B737 Classics there is no longer the demand for spares. The conversion of so many -400s to freighters has allowed the type to be in some demand though buyers of passenger aircraft continue to look for a bargain. The oldest -400 is now nearly 30 years of age and the focus for conversion candidates is on those built in the mid to late 1990s not that many of these remain.