Budget carriers now eye aircraft-leasing business
They set sights on new revenue stream after having ordered record numbers of planes
Paris
FROM Scandinavia to South-east Asia, low-cost airlines have ordered record numbers of planes in recent years, redefining the jet industry. Now they plan to lease out scores of their new planes, re-ordering the aviation business all over again.
Between them, Indonesia's Lion Air, Malaysia's AirAsia and Norwegian Air Shuttle have ordered more than 1,400 Airbus and Boeing jets, worth about US$140 billion at current list prices. They're about to test the growing market for rented planes, competing with established finance firms that lease out aircraft to cash-strapped carriers from China to the United States.
Jet makers and the finance companies which dominate aircraft leasing question whether budget airlines have the know-how to succeed, and some in the industry wonder whether they have simply ordered more planes than they need. But the low-cost carriers' sights are trained on new revenue streams, and net profit margins of about 20 pe…
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