Russian government orders national airlines to keep planes leased to foreign companies

The fate of hundreds of foreign-owned planes that are leased by Russian airlines darkened further on Monday after Russian President Vladimir Putin signed into law a law allowing airlines to register such aircraft and continue to use them.

Russian state media noted that the law will allow Russian airlines to retain their fleets and operate foreign aircraft on their flights within Russia.

Many of the aircraft of Russian airlines are leased from foreign companies, including several of Irelandmember of the European Union (EU). Last month, the EU banned the sale or lease of aircraft to Russia as part of the sanctions for their invasion of Ukraine. The companies have been given a deadline of March 28 to end their existing contracts with Russian companies.

Last week, Russia’s air transport agency recommended that airlines with foreign-registered planes not take them out of the country because of the risk of being seized.

In addition, the sanctions prohibit companies from West supply parts or maintain Russian airlines, and analysts say it’s unclear whether those aircraft are still insured.

According to different estimates, the number of foreign planes operated by Russian airlines is about 500 or more, and most of them were inside Russia when the war began on February 24. The aviation consulting company iska estimates that those foreign-registered aircraft are valued at $12 billion, and almost half of them are from lessors based in Ireland.

“We are in uncharted territory. We don’t know if they will see those aircraft again.”said Helena Beckeraviation analyst for financial services company Cowen. “We suspect that (Russian airlines) will use whatever spare parts they have and then start cannibalizing (the parts) to keep those aircraft in the air, and when that’s over then they’ll see what to do.”.

According to the aviation consultant I WAS GOINGthe company that may be most affected by the war is AerCapa company based in Dublin and that it has 152 planes valued at almost $2.4 billion that are flying, parked or stored in Russia or Ukraine.

An AerCap spokeswoman indicated that 5% of the value of its fleet is in the hands of Russian airlines. She referred to a February 28 document in which the company said it would comply with the phase-out of aircraft leasing to Russian airlines, declining to comment further.

Leasing companies have recovered a very small number of aircraft. aircastlea lessor of Connecticutrecovered one while he was detained in the Mexico City. SMBC Aviation Capital tried to recover a plane from Aeroflot on Cairobut the ship was able to return to Moscowaccording The Air Currentan aviation news website.