Leases For 515 Planes Of Russian Airlines To Be Axed

Lessors are set to terminate hundreds of aircraft leases with Russian airlines following Western sanctions over the invasion of Ukraine that require the contracts be canceled, Jamie Freed and Alexander Cornwell reported for Reuters.

Photo Insert: The Russian clients of Aercap include Aeroflot, S7 Airlines, Rossiya, Azur Air, and Ural Airlines.

AerCap Holdings, the world's biggest leasing company, said on Monday it would cease leasing activity with Russian airlines, while BOC Aviation said most of its leases in Russia would now have to be terminated by March 28. Russia warned the West it would retaliate against sanctions targeting its aviation industry.

Russian companies have 980 passenger jets in service, of which 777 are leased, according to analytics firm Cirium. Of these, two-thirds, or 515 jets, with an estimated market value of about $10 billion, are rented from foreign firms in the mainly Ireland-based industry.

AerCap, which has the largest exposure to Russia and Ukraine with 152 planes according to consultancy IBA, said by net book value 5% of its fleet was leased in Russia as of December 31.

Its Russian clients include Aeroflot, S7 Airlines, Rossiya, Azur Air, and Ural Airlines, its website shows, involving aircraft worth an estimated $2.5 billion, according to aviation services firm ACC Aviation.

ACC Aviation Vice President Viktor Berta said repossessing aircraft could prove challenging, including if Russian aviation authorities and airlines were not cooperative with lessors.

Avolon, the world's second-biggest leasing company, has fewer than 20 airplanes in Russia and one or two in Ukraine out of a total fleet of more than 550 aircraft, CEO Domhnal Slattery told Reuters this month.

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