Lessors found themselves in an unprecedented position throughout the pandemic as they found ever-more creative ways to support their airline customers: writing off overdue rents, agreeing to flight-hour-based lease payments and sometimes even taking stakes in airlines under debt-for-equity swaps.
They were also pushed into an unusual position regarding maintenance oversight, as aircraft were returned early by airlines that could not afford to keep them and onward customers proved hard to find.
“The pandemic led to a surplus of aircraft, which inevitably led to prolonged remarketing periods,” notes one lessor source in an interview with Inside MRO.
He adds: “The pandemic led to more early terminations and repossessions, in which case lessors were being exposed to performing maintenance themselves.”
The leasing executive believes this situation will normalize as demand for aircraft picks up again, both due to returning passengers and delivery delays of new aircraft.
However, he also noted that lessors’ technical management continues to be impacted by issues in aftermarket supply chains.
“It has had and continues to have a major impact with most aircraft not maintaining schedule in MROs due to supply issues,” the source says.
“This is likely to continue for some time as the supply chain slowly repairs itself. Shortages on items like electronic chips and wiring have been quite disruptive," he says. "Repair shop capacity has also been an issue with certain suppliers having reduced workforce during the pandemic, which created bottlenecks in the system.”
For a thorough insight into how lessors' technical management has been affected by the pandemic and the subsequent recovery, see the next issue of Inside MRO.
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