Dubai Aerospace Enterprise does not see value in placing orders for new-technology narrowbodies, the Middle Eastern lessor's chief executive Firoz Tarapore has told FlightGlobal.
"We think that it makes no sense whatsoever to place an order at the value proposition that exists today, which is the price that the OEMs want relative to the rentals that they are getting in the market," said Tarapore in Dublin on 22 January.
"The risk that goes along with that is completely unsustainable," he adds.
Tarapore, whose company inherited A320 orders with its purchase of AWAS, says the maintenance cost of the new-technology engines is unknown and argues that the manufacturers therefore cannot justify the premiums they charge. He suggests that airlines will have the choice to pay for new equipment or take secondary equipment at half the lease rate.
DAE will deliver its final A320 (MSN 8835) to Star Flyer in March, Flight Fleets Analyzer indicates.
Analysis of Airbus and Boeing data reveals that lessors account for around a fifth of the Max's 5,005 direct orders and a quarter of the Neo's 6,526. Flight Fleets Analyzer, factoring in sales-and-leasebacks, shows that 28% of on-order and in-service Neos and 26% of Max jets are managed by lessors.
At least 32 lessors manage Neos; for the Max, the figure is at least 27.
Tarapore tells FlightGlobal that "we do not see any value" in joining such a long list of lessors for narrowbody programmes "at this point".
Last year, two lessors placed their first orders for the types: Goshawk and Jackson Square Aviation. In each case, it was the first time the company had placed a direct order with an OEM.
Tarapore adds that the number of aircraft ordered by lessors in this segment is "unsustainable", and believes this will become particularly evident over the next several years.
DAE, one of the top 10 lessors by value and fleet size, has 354 aircraft leased to 109 airlines in 57 countries, its website indicates. The average age of aircraft in the owned fleet is around six years.
Source: Cirium Dashboard
