Capacity adjustments caused by Covid-19: The challenges of accelerated lease returns

When Covid-19 hits a prospering leasing market, the effects will be substantial. It is expected that significant capacity adjustments will lead to a wave of premature lease returns and present unprecedented challenges to aircraft operators (lessees) and leasing companies (lessors). 

This article provides a short-list of the most common problems aircraft operators face over accelerated lease returns with recommendations on how to resolve them to ultimately limit the cost of the aircraft transition process. 

Looking ahead: planning for the future

While Covid-19 will change the fundamentals of the aviation industry, it will also change the composition of aircraft fleets towards newer and more fuel-efficient aircraft. This transition however will challenge aircraft operators and owners over the next couple of years and requires a high degree of attention. 

Therefore, aircraft transition management will become a very important agenda item in the near future in order to limit the drain of cash towards lessors looking to recover lost lease fees through penalty schemes over contract non-compliances. 

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Best Consultants 2022

Best Consultants 2022: Lufthansa Consulting ranked among the top consulting firms in Germany

Listed by brandeins, the renowned German business and trend magazine, for the seventh time. Lufthansa Consulting ranked top of the category "aerospace and defense" and ranked high in the area "transport, traffic and logistics". The rating is greatly respected throughout a wide range of industries and is based on recommendations from industry experts and client assessments.