Reserves Airbus and Boeing aircraft years in advance, then rents them to airlines on long-term leases.
At a glance
- Depends onUpstream position: supplies 3 industries, depends on 0
- ScaleMarket cap is above the global median
- Position
Reserves Airbus and Boeing aircraft years in advance, then rents them to airlines on long-term leases.
Air Lease Corporation buys delivery slots from Airbus and Boeing years before the aircraft are built, then leases those planes to airlines under long-term contracts, keeping the risk of what each aircraft is worth at the end of the lease on its own books. Because Airbus and Boeing each run fixed production schedules that no buyer can accelerate, how many aircraft Air Lease can add to its fleet in any given year is determined by slots it locked in years earlier — not by how much capital it has available today. Holding positions across all four major families at once — the A320neo and A350 from Airbus, the 737 MAX and 787 from Boeing — lets Air Lease place whichever type an airline needs as demand shifts, but that same breadth requires managing four separate sets of maintenance programs, airworthiness authority relationships, and certification processes that smaller rivals cannot replicate without the order volume to earn preferred slots from both manufacturers. The whole arrangement depends on at least one manufacturer family remaining available: if a grounding or production halt struck Airbus and Boeing simultaneously, Air Lease could not substitute between them, and the forward delivery pipeline would stop entirely.
How does this company make money?
Airlines pay a fixed monthly rent for each aircraft based on the type of plane and the length of the lease. On top of that, airlines pay into maintenance reserve accounts over the course of the lease to cover the cost of heavy maintenance checks when they come due. When a lease ends, the company earns additional money by re-leasing the aircraft to a new airline or selling it outright.
What makes this company hard to replace?
Swapping to a different lessor mid-lease is genuinely disruptive for airlines. Pilots hold type-rating certifications tied to a specific aircraft model, so switching planes means retraining crews. Moving an aircraft to a new jurisdiction requires going through that country's aviation authority approval process, which takes months. Maintenance reserve balances built up under an existing lease agreement cannot simply be handed over to a replacement lessor.
What limits this company?
Airbus and Boeing each publish fixed production rates and assign delivery slots years in advance. No amount of money or urgency can pull a slot forward once the schedule is locked. That means the company can only grow its fleet as fast as the delivery positions it already booked in prior years allow — its current financial strength makes no difference.
What does this company depend on?
The company cannot operate without Airbus A320neo and A350 aircraft built in Toulouse, Boeing 737 MAX and 787 aircraft built in Seattle and Charleston, airworthiness certifications from the FAA, EASA, and individual country regulators whenever an aircraft changes hands, maintenance reserve payments from the airlines currently leasing its planes, and aviation insurance coverage for hull and liability risks across every country where its aircraft fly.
Who depends on this company?
International airlines depend on these leases for the aircraft that operate their routes — if leases were terminated, those airlines would immediately lose capacity and face groundings. Airbus and Boeing themselves depend on large lessor orders to keep their production lines running at full utilization. Airport slot coordinators at busy, capacity-constrained airports would also face gaps if the leased aircraft operating there suddenly needed to be replaced.
How does this company scale?
Buying more aircraft in larger blocks gets cheaper per unit and earns better delivery positions with the manufacturers, so the purchasing side scales well as the company grows. The technical side does not scale the same way — every aircraft type has its own maintenance programs, airworthiness requirements, and transition processes, and the expertise needed to manage each one does not shrink as the fleet gets larger.
What external forces can significantly affect this company?
ICAO emissions standards push airlines toward newer, more fuel-efficient aircraft, which makes older planes in the fleet go out of fashion faster. Bilateral aviation agreements between countries determine which airlines are even allowed to operate leased aircraft on international routes, which affects where planes can be placed. Rising USD interest rates increase the cost of financing the fleet and also make it cheaper for airlines to just buy aircraft outright rather than lease them.
Where is this company structurally vulnerable?
If both Airbus and Boeing aircraft were simultaneously grounded or their production lines suspended — a wider version of what happened when the 737 MAX was grounded — the entire forward delivery pipeline would freeze. The company's ability to keep placing aircraft depends on being able to switch between the two manufacturers when one has a problem. If both are unavailable at once, that escape route disappears entirely.
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