The tale of a single 777: From groundbreaking aircraft to a low-cost bargain

I was intrigued by a Sept. 5 article in Simple Flying about the sale of a Jet Airways Boeing 777-300ER for just $9 million to IAGCAS 777 LLC, part of the ongoing bankruptcy process of the Indian airline. The aircraft, seized by creditors in April 2019, was auctioned by administrators in the Netherlands to settle debts.

Mike Arnot, a principal at Juliett Alpha, an aviation communications firm, stated, "The $9 million sale of a former Jet Airways 777-300ER by administrators is expected. It’s a distress sale stemming from a bankrupt airline. Additionally, the aircraft is believed to be in poor condition, requiring extensive maintenance for its airframe and engines, and the market for twin-aisle planes remains weak due to ongoing travel restrictions and stagnant long-haul traffic."

My connection with the Boeing 777 dates back to June 7, 1995, when United Airlines showcased one at Washington Dulles International Airport (IAD) en route to the Paris Air Show. I was present, along with numerous media representatives and guests.

Boeing's media team showcased the standout features of United's $122.5 million 777, highlighting it as the manufacturer’s inaugural fly-by-wire aircraft and its first use of composites in the engine nacelles, wing parts, and stabilizers. At that time, the 777 was praised for its extended range, increased payload capacity, improved aerodynamic efficiency, and lower fuel expenses, all attributed to enhancements from its Pratt & Whitney PW4000 engines.

The aircraft interiors boasted LED ambient lighting for various flight stages, inflight Wi-Fi, and an all-in-one device for telephone, video recording, television, intercom, CD playback, gaming, computer connection, faxing, shopping, telecommunications for the hearing impaired, and credit card processing, all accessible from the seat armrest. United claimed its 777 featured the widest seats, largest overhead bins, and some of the most spacious aisles of any aircraft at the time.

As of September 8, a total of 1,673 777s have been produced, with 1,127 currently operational, 412 in storage, 381 on order, and 127 decommissioned, according to Cirium.

United Airlines once operated 96 777s at its peak. Meanwhile, Delta Air Lines retired its fleet of 18 777s in October 2020, largely due to the pandemic and a transition to the Airbus A350. Other airlines, such as Qatar Airways and Etihad, have also phased out their 777 fleets.

According to Arnot, the bulk of a Boeing 777's value now hinges on its maintenance state. "These aircraft are highly costly to maintain and to transfer between airlines. Each engine overhaul can reach up to $13 million, while interior reconfigurations can range from $15 to $20 million," he noted. "Converting the aircraft to a freighter would incur even greater expenses, with no conversion slots available until 2024."

According to Arnot, a buyer aiming to keep the aircraft operational would need to invest an additional $45 million to $60 million beyond the initial purchase price. "Alternatively, they could dismantle the aircraft for spare parts. However, with the engines being run-out, their value is minimal; the real worth comes from reselling the airframe and any engine components that remain functional and in demand," he explained.