Omens good for old 757s despite production axe

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MAX KINGSLEY-JONES / LONDON

The -200's size and range may attract low-fare carriers, but less popular -300 looks doomed

Boeing's much-anticipated decision last month to end production of the 757 does not necessarily hamper the long-term prospects for the 200-seater in the secondhand market. Analysts believe that the aircraft's unique combination of size and range could mean it is well positioned for the upturn when it eventually comes, both as a passenger aircraft and as a freighter.

'If you have a route that specifically requires that particular capacity/range performance, it is a remarkable aircraft,' says Edward Pieniazek, director of consultancy at UK analyst Airclaims. 'If we get a traffic rebound soon, it might be just the right aircraft at the right time again...but it's a big if.'

Pieniazek believes the aircraft could find a market with low-cost carriers in Europe and the USA: 'The aircraft could appeal to airlines looking to soak up capacity thanks to attractive lease rates.' He adds that the smaller 757-200 model 'looks better for freighter conversions in the future...it's the only aircraft in its class'.

The termination is more ominous for the -300 stretch model, of which only 55 will have been built when production ends, against 992 -200s. 'This will have an impact on 757-300 residual values. The potential to build a handful more has now gone, so the population is restricted,' says Pieniazek.

Airclaims believes that the 757's size, once one of its strongest cards, came back to haunt it when the market collapsed two years ago. 'In the current climate, airlines have been looking for lower capacity aircraft where there is less risk - and, as was once said, no one goes out of business flying too-small aircraft,' says Pieniazek. He adds that the improving capabilities of the Airbus A320 and Boeing Next Generation 737 families have ensured there is plenty of choice in the 130- to 200-seat market, where once the 757 had little competition. Production of the twinjet will have spanned 23 years when it ends in 2004 with the delivery of the 1,047th aircraft - if no more orders are placed.

Output has averaged 45 aircraft a year, with the peak production being from 1990-2, when a quarter all the 757s delivered were built