Israel Aerospace Industries said Wednesday it signed an agreement with Etihad Engineering to establish a facility in Abu Dhabi that will convert Boeing 777-300ER passenger planes into cargo aircraft.
The new facility, which will operate as the company’s maintenance center in Abu Dhabi, aims to meet the growing demand for large cargo jets.
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“Not only do we see the demand, but we view it as a greener, more profitable, highly innovative solution for our airline customers, and an excellent way to drive value for our business,” Tony Douglas, chief executive of Etihad Aviation Group, said in a statement.
Demand for cargo plane conversions has been on the rise with the increase in ecommerce and the decline in value of used planes during the COVID-19 pandemic.
State-owned IAI currently converts Boeing 737, 747 and 767 passenger aircraft for cargo use. It has said it is currently developing a conversion method for the Boeing 777 and expects to finish the licensing process in 2023.
The deal comes a year after Israel and the United Arab Emirates agreed to normalize relations under the U.S.-sponsored Abraham Accords.
Over the past year, Israeli firms have forged a number of deals in the UAE.
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In March, IAI said it would jointly develop an advanced drone defense system with the UAE’s state-owned weapons maker EDGE.
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