Aircraft Leasing Industry Profile

Companies in this industry rent or lease aircraft and airplane equipment without operators. Major companies include US-based Air Lease and GE Capital Aviation Services, as well as AerCap (the Netherlands), Avolon (Ireland), and Dubai Aerospace Enterprise.

The Asia/Pacific region is forecast to be the fastest-growing market for the industry. Drivers of growth in the region include rising disposable income, increased business and leisure travel, and greater air cargo traffic.

The US aircraft leasing industry includes about 385 establishments (single-location companies and units of multi-location companies) with combined annual revenue of about $8 billion.

COMPETITIVE LANDSCAPE

Demand is driven by activity in the air travel industry. The profitability of individual companies depends on the fleet mix and the cost of financing rental inventory. Large companies have economies of scale in buying aircraft and accessing multiple sources of capital, as well as maintaining a diversified aircraft portfolio. Small companies can compete by providing superior customer service and depth of experience. The US industry is highly concentrated: the top 20 companies account for more than 95% of revenue.

PRODUCTS, OPERATIONS & TECHNOLOGY

The majority of revenues come from the lease and rental of air transportation equipment. Some aircraft rental firms also sell planes and aircraft engines and offer fleet management services to generate additional revenue streams. Firms typically offer between 100 and 1,000 aircraft for lease.

Airlines lease or rent rather than buy planes because of the lower capital commitment, to ...