Ireland World Aircraft Leasing Leader

'A World Leader in Aviation Finance and Leasing'

Irish based aircraft leasing companies account for 50% of the global leasing industry.

Ireland has become a world leader in aircraft leasing, with 50% of the global lessors headquarters based in Ireland - GECAS, Avolon, Aercap to name a few. The industry is set for growth over the coming years with gross income in Ireland set to rise to €20 billion by 2033.

Airlines are constantly in need of new aircraft to grow, expand, and keep their fleet up to modern standards. 

$120 billion worth of aircraft was produced in 2015 globally to supply these airliners needs.

However, this still wasn't enough to supply the demand for new aircraft. Boeing, and Airbus all have HUGE back orders on new aircraft for airliners across the globe.

 

Airbus Aircraft Orders       Boeing Orders

Ryanair's founder, Tony Ryan, was a pioneer in the aircraft leasing business when he spotted the potential for a lease-finance business model in order to help improve airlines returns.

He was able to offer airlines with surplus aircraft an opportunity to off-load them to other parts of the globe in order to gain steady profits.

Tony Ryan pioneered the way for aircraft leasing, as a means to improve airline's returns.

Tony Ryan pioneered the way for aircraft leasing, as a means to improve airline's returns.

Aircraft leasing companies are in constant state of dynamic development. Adapting to the markets ever changing demands.

Each of them operates a fleet which is regularly moving between airline customers.

Leasing accounts for about 45% of all aircraft being delivered to airlines

An intense period of corporate activity has ensued over the last five years, including mergers, acquisitions and IPOs with a lot more planned for 2016 and beyond.

So, you might be wondering why the hell a small peripheral country like Ireland boast's such a huge percentage of the global aircraft leasing companies.

Ireland is known world-wide for having legitimate low-tax strategies.  The perfect location for multi-national corporations to situate their European headquarters in.

There are many more reasons why Ireland has remained strong as the centre of excellence for aviation finance and aircraft leasing:

  • Corporation Tax rate: 12.5%.

  • Expansion of double tax treaty network.

  • Opportunity for new investment.

  • Irish Aviation Authority is an EASA registry.

  • Irish Stock Exchange has a dedicated Aviation Exchange for aviation related debt.

  • The Irish Government have a joint venture with SITA - Aviareto.

Read More: Ryanair Orders 200 New Boeing 737 Max Aircraft.

 

Aercap are one of these corporations, with a fleet of no more than 1,300 aircraft and another 460 on order.

Its asset base is valued at $43 billion. 

After transferring a large amount of the fleet it acquired when buying US based ILFC in 2014 it moved the administration of those planes to Dublin. 

Ireland has recently gained another global air finance leader in GE Capital Aviation Services (GECAS,) which has recently moved a key element of its management to Dublin and Shannon.

In 2014, GECAS bought up Irish based helicopter-leasing firm Milestone Aviation Group in a deal worth €1.4 billion. The america conglomerate is one of the biggest players in the sector.

The move will diversify the GECAS business model beyond leasing of commercial jets and put its capital "to work at good returns", according to chairman and chief executive Keith Sherin.

Avolon Inc., set up in 2010 by Domhnal Slattery, was a new Irish aircraft leasing company that built up a fleet of 145 aircraft.

Sales revenues were estimated at €830 million before selling to Chinese Bohai Corporation in 2015. A deal worth €2.63 billion. The Dublin office's continues to operate for the lease company.

Avolon’s CEO is spending time in Hong Kong as part of that transaction but he and Bohai have affirmed Ireland as the headquarters for its aircraft leasing unit. 

Read More: GE Aviation to build in Czech Republic.

Dómhnal Slattery

Avolon is headed by Dómhnal Slattery.

Demand for air travel has grown by an average of 5% per year over the last 20 years.

Forecasts published by IATA, the global airline trade body, states demand for air travel over the next 15 years will double

The growth expected to be by increasing wealth in the Asia-Pacific and emerging markets.

This is an indication that despite various changes in ownership, and attraction from other jurisdictions, Ireland maintains its strong role in the aircraft-leasing business.

The leasing business is looking even more promising with industry sources estimating that aircraft lessors will increase penetration of the commercial jet market from the current 40% to an estimated 60% of the flying fleet.

This forecast would see Irish aircraft leasing income increase from €8.9 billion in 2015 to an estimated €20 billion by 2033.

The Irish Government are relishing the continued growth for the aircraft-leasing industry in Ireland and have participated in a joint venture to establish and operate a global register of financial interests in aircraft, Aviareto.

Read More: Dublin and Shannon Airport Traffic Soars.

Aviareto, based in Dublin, is acting on a not for profit, cost recovery basis, as required by the Cape Town Convention

Aviareto, based in Dublin, is acting on a not for profit, cost recovery basis, as required by the Cape Town Convention

'A world leader in aviation finance and aircraft leasing' - that is a proud accolade for the Irish to be able to boast around.

Ireland's reputation as the centre of excellence in this industry is promised to continue on growing, with further IPO's and mergers set for 2016 and beyond. 

Aviation sector investors and lenders are favourably seeking to head quarter their operations from Ireland for reasons which include a combination of a favourable taxation strategy, a wide double tax treaty network and professional expertise.