Aircraft Wet Lease Agreement

Aircraft leasing saves operators the financial burden of buying expensive assets. However, as the aviation leasing market is still maturing and diversifying, airlines are striving to immediately reduce CapEx. Under a leasing model, airlines can rapidly increase or reduce their fleets without expensive assets on the ground. Compared to buying an airplane, leasing speeds up the process of taking off your plane and making a profit. The choice of aircraft rental also gives airlines the flexibility of short-term commitments, a structure that opens the door to new cost savings in the form of “correct” routes where aircraft capacity corresponds to passenger demand. Vehicle leasing is very important to the industry, as airlines often convert to wet leasing to keep running smoothly at peak times, to deal with planned or unexpected maintenance checks, or to test new routes. In addition, an aircraft for rent in water can be used to fly services to countries where the taker is unable to operate. A wet lease is an agreement under which the lessor agrees to make one or more cabin crew members available to the taker. In addition, as part of this agreement, the leaser is also responsible for the greater maintenance of the aircraft and the assurance that may be required to operate the equipment. The owner makes available the aircraft and sometimes the service of the cabin crew.

This crew may include cabin crew members, engineers, etc. The owner could even bear his months` salary, but the daily allowance is not covered. The owner is also required to pay for insurance and alimony. According to the agreement, the owner charges block hours, i.e. whether the plane flies or not, the tenant is responsible for paying the minimum guaranteed block hours. As part of the lease, the aircraft is considered an asset and therefore appears in the taker`s balance sheet. For example, the Egyptian airline, EgyptAir, cannot travel to Israel. As such, a new “airline”, Air Sinai, air-leasing EgyptAir flights travel between the two countries. Jet leasing contracts accounted for less than 2% of the fleet in 1976, followed by 15% in the early 1990s, 2000 25% and 40% in 2017, with owners participating in 62% of quarantine aircraft transactions in the second half of the year since 2000: 42% in Europe and 29% in North America. [1] In 2015, more than $120 billion worth of commercial aircraft were delivered worldwide, and half of the world`s owners were based in Ireland. [2] Several companies in the aviation sector offer not only aircraft for leasing, but also pilots, crews, maintenance equipment and even airline certificates. This is called wet lezing.

The first is obviously the plane. Some car rental companies operate small fleets of A320s or 737s, but others, such as Hi Fly, operate the entire Airbus family of aircraft: A320, A330, A340 and A380, from 150 to 500 seats, from medium distance to very long distance, from narrow bodywork to the very large category of aircraft. At the end of July 2015, the 50 largest aircraft leasing companies managed 8,184 aircraft: 511 regional turboprops, 792 regional aircraft, 5,612 narrow-bodied aircraft and 1,253 wide-body aircraft. [11] In 2017, the 150 leasers manage 8,400 aircraft worth $256 billion with 2,321 aircraft behind 28, whose penetration has stabilized at 42.6%. [12] Aircraft rental companies are often banks, hedge funds or financial institutions.