Ireland is the leading centre for aircraft leasing accounting for 50% of all leased aircraft globally.
It is estimated that an Irish-leased aircraft takes off somewhere in the world every two seconds.
So how is the sector here likely to respond to concerns over aviation fuel shortages?
Yesterday Ryanair CEO Michael O’Leary said disruption to jet fuel supplies may kick in during early May if the war in the Middle East continues.
The shortage and price of fuel is not going to affect leasing companies in the short term, but it may do in the long term, according to aviation journalist Gerry Byrne.
He said it may impact on airlines trying to pay their leasing company for the aircraft, but once they are paying their subs the leasing companies aren’t likely to be concerned.
These companies have already survived two major disruptions in the past five to six years.
Airlines ground to a halt during the pandemic, but lessors used the disruption to reinforce their position as a global hub, and bounce back.
They offered essential liquidity to airlines, by offering rescheduled leases, sale and lease back deals on airline assets and other measures.
More recently, Mr Byrne noted how the sector survived the outbreak of the war in Ukraine, when 400 aircraft were taken away from the international lease industry.
He said potentially upwards of a half of those were controlled by Irish companies.
“The Russian government forbade the return of aircraft, which lessors were demanding be returned due to sanctions against Russia.
“They were effectively possessed or taken away by the Russian government and by Russian airlines. And that was a huge burden.
They survived thanks to the very innovative financing arrangements that they have, he added.
Mr Byrne said lessors don’t have to wait for a lease to end before they get their cash, they sell leases to international investors, to pension funds, various other types of investor.
“They’re getting a lot of money forward,” he said. “Even while a lease is still being paid, they’re getting a substantial amount of that ongoing, which they invest in new aircraft.”
