Boeing beefs up business to convert old 737 passenger planes into cargo jets

Key Points
  • Boeing is partnering with a Costa Rican company to add to freighter-conversion capacity.
  • Old 737 passenger planes converted into freighters have won orders with companies including Amazon.
  • Cargo demand has been a relative bright spot in the pandemic while passenger travel remains below 2019 levels.
An ASL Airlines Boeing 737-400 freighter landing at Milan Malpensa airport.
Fabrizio Gandolfo | LightRocket | Getty Images

Boeing is adding capacity to convert old 737 passenger planes into cargo haulers, a bet on continued growth in e-commerce.

The Chicago-based company said Wednesday it will add two production lines to convert Boeing 737-800s into freighters that will be operated by Cooperativa Autogestionaria de Servicios Aeroindustriales, which is located in a free-trade zone near Costa Rica's capital, allowing for the duty-free importation of parts.

Converted 737 freighters have become more popular and won orders from Amazon as the e-commerce giant adds to the fleets of airlines that fly for its Amazon Air arm.

Boeing already converts 737-800s into freighters in Shanghai, Guangzhou and Jinan, China.

Air cargo has been a bright spot for airlines during the pandemic as passenger demand dropped sharply, while lower capacity has driven up freight costs. Air cargo volumes hit a record in March, the International Air Transport Association said Tuesday.