European sanctions could strand leased planes in Russia
Western sanctions meant to punish President Vladimir V. Putin of Russia for invading Ukraine may have also dealt a big blow to European companies that leased commercial aircraft to Russian airlines. The majority of commercial aircraft flown by Russian companies are leased, more than half of them from companies abroad. Most of those companies are based in Ireland, a member of the European Union, which banned the sale or leasing of aircraft to companies in Russia as part of its sanctions package. At stake is the fate of hundreds of planes worth an estimated $12b, according to Ishka, a consulting firm that specializes in the aviation industry. Those based in Ireland are particularly exposed, with $4b to $5b worth of aircraft in Russia, it said. The sanctions give companies leasing the planes until March 28 to terminate existing contracts, the Irish government confirmed on Monday. But getting the planes back won’t be easy. The repatriation of leased planes is normally planned years in advance. Airlines in Russia may not cooperate or may be ordered by Putin’s government to throw up obstacles. Another challenge is that Europe and Russia have closed their airspaces to each other’s planes. “The logistics are immense. We are talking hundreds of planes that need to be flown out,” said Phil Seymour, an aviation specialist with IBA, a consulting firm. He listed off the questions that the companies that own the aircraft now face. “Where in the world can they go? Will they play ball? Will there be any edict from above, telling not to cooperate?” he said. AerCap, the world’s largest leasing company for commercial aircraft, said on Monday that it would fully comply with sanctions requiring it to cease leasing planes to Russian airlines. Based in Dublin, AerCap is likely to be the company most heavily exposed to the sanctions, with 152 planes valued at nearly $2.5b in Russia and Ukraine, according to IBA. Nine other leasing companies based in Ireland also have planes in Russia. <br/>
https://portal.staralliance.com/cms/news/hot-topics/2022-03-01/general/european-sanctions-could-strand-leased-planes-in-russia
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European sanctions could strand leased planes in Russia
Western sanctions meant to punish President Vladimir V. Putin of Russia for invading Ukraine may have also dealt a big blow to European companies that leased commercial aircraft to Russian airlines. The majority of commercial aircraft flown by Russian companies are leased, more than half of them from companies abroad. Most of those companies are based in Ireland, a member of the European Union, which banned the sale or leasing of aircraft to companies in Russia as part of its sanctions package. At stake is the fate of hundreds of planes worth an estimated $12b, according to Ishka, a consulting firm that specializes in the aviation industry. Those based in Ireland are particularly exposed, with $4b to $5b worth of aircraft in Russia, it said. The sanctions give companies leasing the planes until March 28 to terminate existing contracts, the Irish government confirmed on Monday. But getting the planes back won’t be easy. The repatriation of leased planes is normally planned years in advance. Airlines in Russia may not cooperate or may be ordered by Putin’s government to throw up obstacles. Another challenge is that Europe and Russia have closed their airspaces to each other’s planes. “The logistics are immense. We are talking hundreds of planes that need to be flown out,” said Phil Seymour, an aviation specialist with IBA, a consulting firm. He listed off the questions that the companies that own the aircraft now face. “Where in the world can they go? Will they play ball? Will there be any edict from above, telling not to cooperate?” he said. AerCap, the world’s largest leasing company for commercial aircraft, said on Monday that it would fully comply with sanctions requiring it to cease leasing planes to Russian airlines. Based in Dublin, AerCap is likely to be the company most heavily exposed to the sanctions, with 152 planes valued at nearly $2.5b in Russia and Ukraine, according to IBA. Nine other leasing companies based in Ireland also have planes in Russia. <br/>
