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Author Topic: Wet-Lease operation  (Read 333 times)

Offline Cedric3108

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Wet-Lease operation
« on: July 08, 2018, 06:53:03 PM »
At lot of real world airlines use wet-leases in order to be able to fly special routes that their own fleets don't allow them to fly or simply to grow faster and/or have lower staffing costs.

I know it is a rather complex issue, but it would be really cool to be able to have wet-leases in AWS. This would allow us to fly routes we are currently unable to fly due to commonality restrictions. A prime example I think is ULH-Routes. A lot of airlines can't fly them, because at some point tech-stops don't work any more and they don't want to fly a much more expensive aircraft type just for the benefit of a few routes. It would be cool if you were now able to lease in a couple of B777-200LR for example. As they are operated by another airline they don't count towards the lessees fleet commonality. So he/she could fly a more efficient fleet of B767s and just fly the B772LR for those routes that really need it. On the other hand the CEO that went for the more expensive to buy and run B777 fleet now can make good money on the side. A win-win for both companies. Of course there would have to be (just like in the real world) a limit to the amount of planes you can wet-lease in. Most airline CBAs allow for a maximum of about 5% wet-lease in. Wet-lease out is usually unrestricted.

I think it could work a little bit like the used marked, but backwards; the company that wants to wet-lease planes makes a market request.
Airline "A" being the lessee
Airline "B" being the lessor

Airline "A" makes a market request for a wet-lease of 7 B777-200LRs for one year. A wet-lease would always include the airplane, crew and maintenance for the planes.
Airline "B" sees the request and opens the window. The CEO would then see something similar to the window you see when listing airplanes on the UM.
He/She would see: the costs of the wet-lease operation (depreciation of 7 B777-200LR for a year, crew costs, administrative costs for the planes, and maintenance: A-and B-Checks, one C-check and 1/8th D-check = because it's a one year wet-lease deal); in order to get a better understanding the numbers could be displayed on a costs per week or per month basis.
He/she would also see: A recommended lease price, a minimum and a maximum; just like on the UM; alliance restrictions could also apply.
The lessor CEO then selects the price at which he/she offers airlines "B"s service to airline "A".
Airline "A"s CEO gets the message and can either accept the offer or decline.
If airline "A" accepts the planes are then fully functional planes for the airline just like any other.
Of course additional administrative staff would be required on both sides for wet-lease ops, making it less efficient than flying stuff yourself. But still a lot more efficient than an additional fleet type.
Other operational costs like fuel would rest with the lessee.
Since crew costs are part of the equation, airlines in low income countries could offer their service cheaper than those in high income countries, making it quite interesting.

I hope I didn't make it too complex, but I would love to see something like that in AWS.


Offline Luperco

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Re: Wet-Lease operation
« Reply #1 on: July 17, 2018, 11:03:22 AM »
Not sure I agree.

While it is interesting, this mean that companies that invest money and time in a particular market, is going to have competition, not only from other companies that invest in the same market, but also from other that doesn't specialise on that.

Already the long and ultra long haul is not efficient as short and medium ones. If you also add the competition from regional companies, may became quite difficult.


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