Page 20 - AAA JANUARY - FEBRUARY 2014 Online Magazine

FEATURE LEASING

To market, to market:

To Buy or to Lease?

The aviation business is booming. Aircraft at a few million a pop are purring out of
factories across the globe – but who is paying for them? Jeremy Torr looks at the
leasing business

WE’VE ALL bEEN THERE. THAT SHINy As Li Zaohang, EVP at BOC Leasing,
new narrow body aircraft is just waiting a subsidiary of Bank of China, noted at
for your signature and your custom a recent signing, “Bank of China Group
paintjob – and it’s only around US$80 and [manufacturers] are clients of each
million if you are quick! Sadly, thanks other and work for mutual benefit. We
mainly to rising fuel prices, the corporate not only cooperate in purchase and sale
piggybank is rattlingly empty, so you have of the aircraft, but also conduct in-depth
to consider other forms of finance. That’s cooperation in commercial banking.” Just
when the leasing companies come to the what you wanted to hear? In many cases
rescue. And rescue they do. According to yes – but not in all cases.
some reports, almost 50% of operational “All our acquisitions are made on a
aircraft will be leased rather than owned risk management basis,” says Capt Leong
by operators come 2020; it’s around 35% SL, VP of Flight Operations at Singapore-
already says Boeing. based Silk Air, which has just signed up

20 ASIAN AIRLINES & AIRPORTS JANUARY / FEBRUARY 2014 WWW.ASIANAIRLINES-AIRPORTS.COM