This week’s JP Morgan 2022 Industrials Conference gave some interesting insights on how major lessors look at the current situation in Russia. The picture that emerges from this is that many key lessors don’t think that there is an imminent risk of fully writing down their leased aircraft
fleets in Russia. Russian leases: no fear for full writedown of assets.
Take AirInsight for a Test Flight
7 days full access — premium analysis and the complete data model library — for $1. No commitment.
Lessors mention security deposits and maintenance reserves as ‘change’ for writing down their aircraft. This is despite a law signed by Vladimir Putin that allows the Russian authorities to nationalize the foreign leased fleet in response to the sanction placed on Russia and the de-registering of Russian aircraft by Bermuda. And even when Russia nationalizes the aircraft and re-registers them in its own register, it isn’t the lessors that are exposed but the insurers. As Steven Udvar-Hazy of Air Lease Corporation (ALC) said, confiscation and nationalization trigger insurance claims for the theft of assets, but this could be a lengthy process.
