Aircraft Leasing: All You Need To Know

Everyone has had to travel somewhere on a plane, and with our curious minds, we always want to know who owns the airline. The basic answer is always the owner of the airline company.

But this is not always the case. A lot of companies lease aircraft from other businesses called aircraft leasing companies and operate under their brand.

Today, we will discuss in detail everything that you need to know about aircraft leasing.

What Is Aircraft Leasing?

The process by which companies rent planes from leasing companies instead of buying them is called aircraft leasing. The main reason why companies lease is because of the plethora of benefits like lower upfront costs, flexibility, and access to various types of planes.

Leases are of two main types: operating and finance leases. Operating ones are shorter-term agreements where the owner (lessor) keeps the plane, and the airline (lessee) pays rent to use it. Finance leases, on the other hand, are longer-term and are more like ownership, with the airline taking on most of the responsibilities for the plane.

With leasing, airlines can easily manage fleet size, adapt quickly to changes in demand, and avoid the risks of owning planes. For leasing companies, it ensures steady income and efficient asset management. Aircraft leasing is essential in helping airlines run efficiently and respond to market needs.

Types Of Leases

Within the two main types of leasing, there are three service options that lessors can provide to airlines: wet lease, damp lease, and dry lease.

Wet Lease

The lessor supplies the plane, crew (pilots and cabin staff), maintenance, and insurance providing a complete package. The aircraft leasing companies get paid based on flight hours or other agreed terms. Wet leases are typically short-term and used for seasonal demand, fleet shortages, or urgent needs for more capacity.

Damp Lease

This is a combination of wet and dry lease. Here, the lessor company provides the plane, but the airline takes care of the crew, maintenance, and insurance. The airline manages the daily operations, while this aviation services company makes sure that the aircraft is safe for flying. Damp leases are ideal for airlines with crews that need extra planes temporarily.

Dry Lease

A dry lease is when only the plane is leased, with no extra services included. The airline takes full responsibility for operations, maintenance, crew, and insurance. These long-term leases give airlines more control and flexibility, making them a good choice for fleet expansion or replacing older planes.

The choice of lease depends on the airline’s needs, lease duration, available resources, and the level of control they want over the aircraft.

Wrapping Up

An aviation services company always provides the best possible aircraft to their clients and ensures that their aircraft are safe and secure for traveling. From the discussion above, you should now be clear about what exactly leasing is in the aircraft industry.