Airlines have the option to either purchase or lease their aircraft, with leasing becoming the favored choice. From roughly 10% of the total fleet in the 1970s, leasing has surged to 58% by the end of 2023.
The most significant surge occurred between 1980 and 2010, with the proportion crossing the 50% mark in 2004. In recent years, there has been a stabilization around the current 60% level, suggesting that this may represent the optimal balance between leasing and ownership in the industry.
Airlines Lease Aircraft
Leasing initially gained traction in North America following deregulation in 1978, affecting trucking, buses, and railroads. The subsequent rise in air traffic demand propelled the share of leased aircraft from 20% to 50% over the decade.
Since then, however, Europe, Latin America, and Asia have embraced leasing to such an extent that their share of leased aircraft now approaches 70% of the total fleet. North America lags behind at 40%—down from 50% in 2010 and the lowest among regions.
The lower proportion of leased aircraft in North America can be attributed to several factors.
Firstly, North American airlines have greater access to capital markets and comparatively inexpensive alternative financing options such as corporate debt.
Secondly, historically dominating the market share, large legacy carriers directly own a significant portion of their aircraft fleet. Lastly, the relatively stronger financial performance of the North American region favors the ownership model.
Conversely, the higher lease share observed in other regions, except for Africa, facilitates a faster fleet renewal process. For details on the average fleet age by region, please refer to the IATA Chart of the Week from September 2023.
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