Fewer new aircraft lift mid-life plane demand

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asset management and investment company, airlines are choosing to pay higher fees to extend leases and keep such aircraft on their fleets, a trend that is consistent worldwide. “Mid-life aircraft, which would normally have been retired, are staying in fleet longer, so airlines are signing early extensions; you see lease rents go up on those aircraft, you are seeing extensions on those planes to keep them on the fleet," Ailstock said in an interview. In India, too, airlines that had planned to retire older planes have often extended leases.

IndiGo, the country’s largest airline, had said in January 2020 prior to the pandemic outbreak that it would start retiring A320ceo aircraft from January 2021, with an aim to return all 126 A320ceos on its 257-aircraft fleet by December 2022. However, the airline has since extended some leases and postponed some redeliveries to ensure supply amid a post-covid surge in air travel demand in India. As of June, the airline had 20 A320ceos in its 316-aircraft fleet.

Ailstock said the shortage of new planes has also prompted recent large aircraft orders, as airlines aim for a more consistent delivery window in the future. “I think the overall theme in the market today is that there is a shortage of aircraft that is causing airlines to do a few things. Some of this you have seen in IndiGo where they placed one of the largest aircraft orders in history to secure delivery slots over the next seven years or so.