Wet lease
Encyclopedia
Aircraft leases are a number of types of lease
s used by airline
s and other aircraft operators. Airlines lease aircraft from other airlines or leasing companies for two main reasons; to operate aircraft without the financial burden of buying them, and to provide temporary increase in capacity. The industry has two main leasing types, wet leasing which is normally used for short term leasing and dry leasing which is more normal for the longer term leases. The industry also uses combinations of wet and dry when for example the aircraft is wet-leased to establish new services then as the airlines flight or cabin crews become trained they can be switched to a dry lease.
(lessor) provides an aircraft, complete crew, maintenance, and insurance (ACMI) to an airline [or other type of business acting as a broker
of air travel] (the lessee), which pays by hours operated. The lessee provides fuel and covers airport fees, and any other duties, taxes, etc. The flight uses the flight number
of the lessee. A wet lease generally lasts one month to two years; anything less would be considered an ad-hoc charter. A wet lease is typically utilized during peak traffic seasons or annual heavy maintenance checks, or to initiate new routes. A wet leased aircraft may be used to fly services into countries where the lessee is banned from operating.
They can also be considered as a form of charter whereby the lessor provides minimum operating services, including ACMI, and the lessee provides the balance of services along with flight numbers. In all other forms of charter, the lessor provides the flight numbers. Variations of a wet lease include a code share arrangement and a block seat agreement.
Wet leases are occasionally used for political reasons; for instance, EgyptAir
, an Egyptian government enterprise, cannot fly to Israel
under its own name, as a matter of Egypt
ian government policy. Therefore, Egyptian flights from Cairo
to Tel Aviv
are operated by Air Sinai
, which wet-leases from EgyptAir to get around the political issue.
In the United Kingdom, a wet lease is when an aircraft is operated under the Air Operator's Certificate (AOC)
of the lessor.
When an air carrier provides less than an entire aircraft crew, the wet lease occasionally is also sometimes referred to as a damp lease, especially in the UK. A wet lease without crew is occasionally referred to as a "moist lease".
and provide aircraft registration. A typical dry lease starts from two years onwards and bears certain conditions with respect to depreciation, maintenance, insurances, etc., depending also on the geographical location, political circumstances, etc.
A dry lease arrangement can also be used by a major airline and a regional operator, in which the regional operator provides flight crews, maintenance and other operational aspects of the aircraft, which then may be operated under the major airline's name or some similar name. This saves the major airline the expense of training personnel to fly and maintain the aircraft, along with other considerations. Fedex Express uses an arrangement of this type for its feeder operations, contracting to companies such as Empire Airlines
, Mountain Air Cargo
, and others to operate its single and twin-engined turbo-prop "feeder" aircraft. DHL
has a joint venture in the United States with Polar Air Cargo, a subsidiary of Atlas Air
, to operate their domestic deliveries.
In the United Kingdom, a dry lease is when an aircraft is operated under the AOC
of the lessee.
Lease
A lease is a contractual arrangement calling for the lessee to pay the lessor for use of an asset. A rental agreement is a lease in which the asset is tangible property...
s used by airline
Airline
An airline provides air transport services for traveling passengers and freight. Airlines lease or own their aircraft with which to supply these services and may form partnerships or alliances with other airlines for mutual benefit...
s and other aircraft operators. Airlines lease aircraft from other airlines or leasing companies for two main reasons; to operate aircraft without the financial burden of buying them, and to provide temporary increase in capacity. The industry has two main leasing types, wet leasing which is normally used for short term leasing and dry leasing which is more normal for the longer term leases. The industry also uses combinations of wet and dry when for example the aircraft is wet-leased to establish new services then as the airlines flight or cabin crews become trained they can be switched to a dry lease.
Wet lease
A wet lease is a leasing arrangement whereby one airlineAirline
An airline provides air transport services for traveling passengers and freight. Airlines lease or own their aircraft with which to supply these services and may form partnerships or alliances with other airlines for mutual benefit...
(lessor) provides an aircraft, complete crew, maintenance, and insurance (ACMI) to an airline [or other type of business acting as a broker
Broker
A broker is a party that arranges transactions between a buyer and a seller, and gets a commission when the deal is executed. A broker who also acts as a seller or as a buyer becomes a principal party to the deal...
of air travel] (the lessee), which pays by hours operated. The lessee provides fuel and covers airport fees, and any other duties, taxes, etc. The flight uses the flight number
Flight number
A flight number, when combined with the name of the airline and the date, identifies a particular flight. This callsign should not be confused with the tail number of the aircraft, although both can be used as a call-sign as used in general aviation...
of the lessee. A wet lease generally lasts one month to two years; anything less would be considered an ad-hoc charter. A wet lease is typically utilized during peak traffic seasons or annual heavy maintenance checks, or to initiate new routes. A wet leased aircraft may be used to fly services into countries where the lessee is banned from operating.
They can also be considered as a form of charter whereby the lessor provides minimum operating services, including ACMI, and the lessee provides the balance of services along with flight numbers. In all other forms of charter, the lessor provides the flight numbers. Variations of a wet lease include a code share arrangement and a block seat agreement.
Wet leases are occasionally used for political reasons; for instance, EgyptAir
EgyptAir
EgyptAir is the flag carrier airline of Egypt and a member of Star Alliance. The airline is based at Cairo International Airport, its main hub, operating scheduled passenger and freight services to more than 75 destinations in the Middle East, Europe, Africa, Asia, and the Americas...
, an Egyptian government enterprise, cannot fly to Israel
Israel
The State of Israel is a parliamentary republic located in the Middle East, along the eastern shore of the Mediterranean Sea...
under its own name, as a matter of Egypt
Egypt
Egypt , officially the Arab Republic of Egypt, Arabic: , is a country mainly in North Africa, with the Sinai Peninsula forming a land bridge in Southwest Asia. Egypt is thus a transcontinental country, and a major power in Africa, the Mediterranean Basin, the Middle East and the Muslim world...
ian government policy. Therefore, Egyptian flights from Cairo
Cairo
Cairo , is the capital of Egypt and the largest city in the Arab world and Africa, and the 16th largest metropolitan area in the world. Nicknamed "The City of a Thousand Minarets" for its preponderance of Islamic architecture, Cairo has long been a centre of the region's political and cultural life...
to Tel Aviv
Tel Aviv
Tel Aviv , officially Tel Aviv-Yafo , is the second most populous city in Israel, with a population of 404,400 on a land area of . The city is located on the Israeli Mediterranean coastline in west-central Israel. It is the largest and most populous city in the metropolitan area of Gush Dan, with...
are operated by Air Sinai
Air Sinai
Air Sinai is an airline based in Cairo, Egypt. It operates as a 'paper-airline' for parent company EgyptAir under a "wet lease"-like agreement.-History:...
, which wet-leases from EgyptAir to get around the political issue.
In the United Kingdom, a wet lease is when an aircraft is operated under the Air Operator's Certificate (AOC)
Air Operator's Certificate
An air operator's certificate is the approval granted from a national aviation authority to an aircraft operator to allow it to use aircraft for commercial purposes. This requires the operator to have personnel, assets and system in place to ensure the safety of its employees and the general public...
of the lessor.
When an air carrier provides less than an entire aircraft crew, the wet lease occasionally is also sometimes referred to as a damp lease, especially in the UK. A wet lease without crew is occasionally referred to as a "moist lease".
Dry lease
A dry lease is a leasing arrangement whereby an aircraft financing entity, such as GECAS and ILFC (lessor), provides an aircraft without insurance, crew, ground staff, supporting equipment, maintenance, etc. Dry lease is typically used by leasing companies and banks, requiring the lessee to put the aircraft on its own AOCAir Operator's Certificate
An air operator's certificate is the approval granted from a national aviation authority to an aircraft operator to allow it to use aircraft for commercial purposes. This requires the operator to have personnel, assets and system in place to ensure the safety of its employees and the general public...
and provide aircraft registration. A typical dry lease starts from two years onwards and bears certain conditions with respect to depreciation, maintenance, insurances, etc., depending also on the geographical location, political circumstances, etc.
A dry lease arrangement can also be used by a major airline and a regional operator, in which the regional operator provides flight crews, maintenance and other operational aspects of the aircraft, which then may be operated under the major airline's name or some similar name. This saves the major airline the expense of training personnel to fly and maintain the aircraft, along with other considerations. Fedex Express uses an arrangement of this type for its feeder operations, contracting to companies such as Empire Airlines
Empire Airlines
Empire Airlines is a charter and cargo airline based in Coeur d'Alene, Idaho, USA. It operates over 120 scheduled and charter cargo flights a day in 18 US states and Canada. Its main base is Coeur d'Alene Airport with a hub at Spokane International Airport....
, Mountain Air Cargo
Mountain Air Cargo
Mountain Air Cargo is an American cargo airline based in Denver, North Carolina, USA. It is a major contract carrier for FedEx Express, operating in the eastern USA and the Caribbean. Previous operations in South America have been discontinued by FedEx who now operate jet aircraft in that area. Its...
, and others to operate its single and twin-engined turbo-prop "feeder" aircraft. DHL
DHL
DHL Express is a division of the German logistics company Deutsche Post providing international express mail services. DHL is a world market leader in sea and air mail....
has a joint venture in the United States with Polar Air Cargo, a subsidiary of Atlas Air
Atlas Air
Atlas Air, Inc. is an American cargo airline based in Purchase, Harrison, New York. It operates scheduled freight flights on a wet lease basis for some of the world's leading airlines, flying to 101 cities in 46 countries. Its crew bases include: Miami International Airport, New York's John F...
, to operate their domestic deliveries.
In the United Kingdom, a dry lease is when an aircraft is operated under the AOC
Air Operator's Certificate
An air operator's certificate is the approval granted from a national aviation authority to an aircraft operator to allow it to use aircraft for commercial purposes. This requires the operator to have personnel, assets and system in place to ensure the safety of its employees and the general public...
of the lessee.
External links
- Indicative commercial aircraft specifications for comparison – Aircraft commonly used in ACMI operations