Ready for taking off: Trujet, who is preparing for Revival after closing during the Pandemie, investigates the option to buy aircraft (file image) | Photocredit: Handout_e_mail
A large number of starting airlines in India, including those waiting for launching, plan to buy aircraft-new or second-handed while struggling against rising rent rental and a scarcity of turbo-right aircraft and jetliners.
For illustration, the average monthly lease for a second-hand (under 15 years, according to the directorate general of the civil aviation determination) 72-seat places ATR72-600 Turboprop aircraft is $ 90,000, while it is $ 2.75,000 for an A320neo. Used Ambacht from Indonesia would cost $ 7 million and $ 60 million respectively.
To worsen things, the dollar-rupe-exchange rate volatility, in addition to the 4.32 percent (three-month average) insured person at night financing percentage (SOFR), has increased the lease costs by 20-25 percent on an annual basis. Direct orders for aircraft from original equipment of equipment, on the other hand, enjoy a 20-30 percent discount and loans that are supported by export credit at less than 6 percent, with an option for sale and leaseback, making Cash Capital Infusion for the airline possible.
New energy
Despite the benefits inherent in the purchase of aircraft, Leasing has dominated the Indian aviation sector, where more than 80 percent of the commercial jets are rented, compared to 53 percent worldwide.
This scenario appears to change in the case of starting airlines. GOA-based regional player Fly91 recently bought his first ATR aircraft, a 72-seat places ATR 72-600, directly from the factory.
Insiders in the industry attribute this shifting trend to factors, ranging from post-known supply chain disruptions to the problems of Goair with leased aircraft engines and the subsequent bankruptcy, and aircraft shortages that lead to steep lease rates as a question of global and domestic carriers.
Insiders from the industry told line Those high tax rates, including GST and import, also make leasing unattractive, even if dollar-dollar payments pays challenges for Indian airlines that earn in rupees.
Ownership aircraft, on the other hand, offer long-term cost benefits, assets property and adjustment control.
Tangible
“The biggest advantage of possessing an aircraft is the direct control that one has for maintenance and reserves, which is otherwise a huge direct costs. The financing costs for assets are also much more efficient in contrast to rental rental,” says Fly91 MD and CEO Manoj Chacko.
“It will also be a tangible active on your balance sheet. However, a deep understanding of the aircraft, finding the right asset and a high -quality maintenance program are absolute essence. The airline must also find the correct balance of owned ownership.”
The upcoming airline Shankh Air, executive director and co-founder Anurag Chhabra, also notes that ownership can improve the balance sheets and at the same time make it easier to access future financing.
“The only option for a newer player remains the purchase of aircraft, because there is long -term costs advantage, possession of power for balance strength and adjustment and control,” says Chhabra.
Umesh Vankayalapati, MD van Trujet, the airline that is preparing for a revival after his shutdown during the pandemic, points to another crucial factor leasing companies hesitating start-ups due to concerns about financial stability. He adds that starting airlines are looking for aircraft to demonstrate their financial viability for leasing companies.
Income
According to founder of Quantace Research Karthick Jonagadla, start-up airlines with a strong capital support can have a margin lead by possessing aircraft.
Owning aircraft can yield an advantage of 6-8 percentage margin compared to models with pure lectures, he says, recording tax arbitration and future ESG-related capital upside down.
“Owning allows airlines to place aircraft in Gift City SPVs (special purposes), to unlock a 10-year tax holiday and depreciation benefits. MRO (maintenance, repair and operational services) GST cutbacks (18 percent to 5 percent) and ‘Herfeliversing, he also says Sale-and-League.
“In a market that is expected to need more than 2,000 aircraft by 2040, ownership of long-term trust, balance strength and flexibility-critical canals in the hyper-competitive skies of India,” explains Jonagadla.
Airworthiness
However, Mark Martin, from Martin Consulting, warns that buying low-priced second-hand aircraft from the gray market raises questions about the financial strength and sustainability of an airline, especially in combination with its reluctance to make its source of funds known as part of strict KYC standards.
He emphasizes the importance of strict compliance with regulations, including the source of funds and credibility of promoter, to maintain the airworthiness of India.
“Today we cannot afford to repeat a situation in East West Airlines from 1992 in which India became a landfill for waste and junk aircraft that no longer wanted the world. The DGCA should immediately check such airlines to ensure that the airworthiness of India does not fall with the import of aircraft with Corrosso.
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Published on 1 June 2025
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