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Airlines are not happy about paying higher plane rental rates

Image for article titled Airlines, always willing to raise fares, upset about price hikes on charter planes

image: Image AaronP/Bauer-Griffin/GC (beautiful pictures)

Air travel is rehibilitate before the global pandemic, regardless of the plane ticketis going up. bHowever, the looming increase in the cost of renting those planes could make The industry is going through a bit of a storm. Banks and lenders around the world are mobilizing interest rate on companies that buy commercial airliners and then lease them major airlineslike Finance time report.

Opportunity is next aircraft A320 or Boeing 737 Max Your board will not actually be owned by airlines bear the name of craftsmanship: more than half of the world’s commercial aircraft are owned by large leasing corporations that lease their fleets to airlines. Like landlords but in the air — skylords, if you will — supporting a variety of household airline brands through long-term aircraft leases.

Image for article titled Airlines, always willing to raise fares, upset about price hikes on charter planes

image: John Keeble (beautiful pictures)

These fleet operators take out loans to buy planes, then turn around and lease them to major airlines. Now the interest for those fleet companies is going upAirline rental prices are increasing up again. The FT Indicate the rental price on Max 737 skyrocketed to 20 percent, while the rate above A320neo 14 percent increase. CNBC monthly rental expense report is hovering in at $316,000 for the 737 Max, $324,000 for the A320neo and $375,000 for its larger sibling, the A321neo.

These monthly rates have been steadily increasing due to a low supply aircraft and demand is high as air travel recovers, but rental companies expect them to be even higher in the short term. Executive Chairman of a rental company group, skillful called Air Lease, says the cost of capital has never been this high since the ’70s. Steven Udvar-Házy of Air Lease explains that the company is seeing interest rate is almost double the interest rate at start this years, and these higher costs are being passed on to the airlines.

As you’d expect, airlines aren’t happy about the overpriced rental rates. Of course, no one thinks they’re the bad guys here. Like Udvar-Házy told FT, “Airlines are under enormous cost pressure, but they were able to pass it on to travelers at higher fares… So Air Lease is not to blame in this respect. We are simply trying to deal with economic realities.

Even so, analysts say fleet owners are getting short-term results. Walthough the price of new aircraft rental increases by 5 to 10 per cent for airlines, it may take close to 30 per cent to cover rising interest rates lease group is facing. Due to the difference, and recently surge In air travel, fleet owners will likely stop giving airlines time to delay as they did. in the midst of a pandemic; According to Udvar-Házy, airlines will not be able to use poverty as an excuse.

But what they can do is make the plane ticket even more expensive to cover the cost. rent their plane. And that’s like a safe bet, if not a happy one.

Image for article titled Airlines, always willing to raise fares, upset about price hikes on charter planes

image: Nicolas saves (beautiful pictures)


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