PHOTO
Fast growing aircraft lessor AviLease expects to slow its rate of growth this year and take a cautious approach to acquisitions following last year's $3.6 billion deal with Standard Chartered, its chief executive said on Wednesday.
Saudi Public Investment Fund (PIF)-backed AviLease agreed to buy StanChart's global aviation finance leasing unit comprising more than 120 aircraft last August, just over a year after the $700 billion sovereign wealth fund launched the new lessor.
AviLease Chief Executive Ted O'Byrne said on Wednesday that the deal accelerated by two years its ambitions to become a top-10 global lessor by 2030.
"We're not trying to grow for the sake of growing. This year we expect to, I won't say take a pause, but slow the growth, the glide path, so that we can consolidate the operation," Ted O'Byrne told the Airline Economics conference in Dublin.
O'Byrne said he also sees a long-term deal with a planemaker to buy new aircraft as an "essential" part of its strategy but would take its time doing so.
"I think we need to be extremely patient right now. I think both Airbus and Boeing have other matters to focus on," O'Byrne said, referring to their production difficulties.
"Having said that, we would like to have a deal done but we will take the time that we need to take. I'm not going to queue at the chalet in Farnborough (annual airshow) to do a deal."
He described the degree of concentration in the planemakers' order book with very few airlines as "worrying" and posed a structural risk to the industry where smaller carriers unable to buy aircraft faced very high lease rates or having to rely on used, inefficient aircraft.
"That's going to suck out a lot of the capacity so I think that is not good and I think the OEMs (original equipment manufacturers) need to recognise that their own commercial policy is creating a risk in our industry overall," he said.
(Reporting by Padraic Halpin, Editing by Louise Heavens)