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Japan's ANA to convert passenger jets to expand air freight business

[SINGAPORE] Japan's All Nippon Airways (ANA) could convert more passenger jets into freighters in the next few years, a strategy that will help it keep costs low while it grows its cargo business amid a market downturn, its chief executive said.

Eight out of the 11 Boeing 767 cargo jets than ANA operates were once passenger jets, CEO Osamu Shinobe told Reuters on the sidelines of an aviation industry event in Singapore.

In the future, ANA could increase that total to at least 13 by converting more of its existing 767 passenger fleet, he added.

The airline has about 40 jets which are being gradually replaced by the newer 787 model. Shinobe said ANA prefers to use existing aircraft for cargo, rather than buy new models such as the Boeing 777F, to keep costs low.

ANA is the only Japanese airline currently operating cargo planes after rival Japan Airlines retired its fleet several years ago.

Shinobe said ANA wants to make the most out of a cargo hub in Okinawa that is located within four hours flying time from much of Asia, enabling it to provide a next-day delivery for many key markets in the region.

ANA has also signed cooperation agreements with United Airlines and Lufthansa on cargo shipments between Japan and the United States and Europe, he added.

Asian airlines are among the largest cargo carriers in the world, but growth in shipments has slowed in recent years amid global, and regional, economic uncertainty.

The International Air Transport Association (Iata) said Asia-Pacific based airlines recorded 0.3 per cent year-on-year growth in air cargo volumes in September. "The contraction in Emerging Asia trade appears to have bottomed out, although China, Korea and Chinese Taipei, among other key economies, are suffering from poor trade growth," Iata said in a report.