What are the best practices for managing an aircraft lease portfolio?

1 Know your lessees

One of the most important aspects of managing an aircraft lease portfolio is to know your lessees well. You need to understand their business models, financial situations, operational requirements, and strategic goals. This will help you to tailor your lease terms, pricing, and services to their needs and preferences, as well as to anticipate and mitigate any potential risks or issues. You also need to maintain regular and transparent communication with your lessees, and to monitor their compliance with the lease agreements and the relevant regulations.

2 Know your assets

Another key factor in managing an aircraft lease portfolio is to know your assets well. You need to keep track of the technical specifications, performance, and maintenance history of each aircraft in your portfolio, as well as the market value and demand for each type and model. This will help you to optimize your asset utilization, allocation, and disposition, as well as to plan and budget for any necessary repairs, upgrades, or modifications. You also need to ensure that your assets meet the safety and environmental standards and certifications required by the authorities and the industry.

3 Know your market

A third essential element in managing an aircraft lease portfolio is to know your market well. You need to be aware of the current and projected supply and demand for aircraft leasing, as well as the competitive landscape and the emerging opportunities and challenges. This will help you to adjust your pricing, marketing, and negotiation strategies, as well as to identify and exploit any gaps or niches in the market. You also need to be flexible and responsive to the changing market conditions and customer expectations, and to adapt your portfolio accordingly.

4 Know your costs

A fourth vital component in managing an aircraft lease portfolio is to know your costs well. You need to account for all the direct and indirect costs associated with owning, leasing, and operating your aircraft, such as acquisition, financing, depreciation, insurance, taxes, fees, maintenance, and fuel. This will help you to determine your break-even point, profitability, and cash flow, as well as to optimize your cost efficiency and effectiveness. You also need to have a contingency plan and a reserve fund for any unexpected or extraordinary costs that may arise.

5 Know your risks

A fifth crucial factor in managing an aircraft lease portfolio is to know your risks well. You need to assess and quantify the potential risks and uncertainties that may affect your portfolio, such as market volatility, currency fluctuations, regulatory changes, legal disputes, lessee defaults, asset impairments, or accidents. This will help you to mitigate and manage your risks, as well as to protect your interests and reputation. You also need to have a risk management policy and a crisis management plan in place, as well as to diversify your portfolio and hedge your exposure.

6 Know your goals

A sixth and final important aspect in managing an aircraft lease portfolio is to know your goals well. You need to have a clear and realistic vision of what you want to achieve with your portfolio, as well as a set of measurable and attainable objectives and indicators. This will help you to evaluate and improve your performance, as well as to align your portfolio with your strategic direction and values. You also need to have a feedback and learning system in place, as well as to seek and incorporate best practices and innovations from the industry and beyond.

7 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?