Old battles, new skies
Welcome to the latest edition of Airline Economics.
Tariffs and recession concerns have overtaken fuel prices as the primary worry for most airline executives. While uncertainty often breeds fear, it also sharpens focus—not complacency. For airlines that honed their agility during the pandemic, this latest bout of volatility is familiar terrain, and one they are better equipped to navigate. Delta, for instance, has sidestepped restrictions by routing new aircraft deliveries through Japan (see News, pX), while other carriers are working to reschedule their orders.
Aircraft manufacturers, by contrast, are more exposed to the chop and change of the tariff environment and risk becoming collateral in a renewed trade war between the US and the EU. The industry has been here before: recall the 17-year WTO dispute between Boeing and Airbus. That argument over illegal subsidies was never resolved—merely paused by a fragile détente, due to expire next year. The current spat threatens to reopen the issue prematurely, compounding disruption across an already battered supply chain.
Despite the worries, new aircraft orders are flooding in even ahead of the Paris air show, mainly as President Trump toured the Middle East and closed trade deals encompassing Boeing orders. Significant demand for lift continues to buoy the secondary trading market with a number of lessor-to-lessor deals disclosed over the past few months (keep track with our daily news updates on www.aviationnews-online.com).
In an industry grappling with long-standing challenges, seasoned leaders are essential to navigate turbulent times—while also mentoring the next generation to chart their own course. This issue pays tribute to the remarkable life and career of Steve Udvar-Hazy, widely regarded as the godfather of the aircraft leasing industry, who is now stepping back as executive chairman of Air Lease to empower his successors to forge their own paths (see cover feature, pX).
Table of Contents
The Godfather of aircraft leasing
After announcing his decision to step down as executive chair of Air Lease Corporation, Steven Udvar- Hazy speaks to Victoria Tozer-Pennington about the pivotal moments of his career, from a young boy with a passion for aviation in communist Hungary to the creation of the global aircraft leasing industry, and navigating the challenges of the past 50 years in aviation.
Generation AI
Artificial intelligence has supported aviation for years, but the rise of generative AI signals a transformative era for the sector. Calum Wilson explores the technology’s impact on the industry.
Metz takes the reins as American’s treasurer
American Airlines new treasurer Clemens Metz speaks to Airline Economics.
A true growth frontier
The Indian aviation industry is growing rapidly. Airline Economics held its third Growth Frontiers in New Delhi in February held at a pivotal time for the aviation market as aircraft deliveries ramp up and aircraft financing enters a new phase.
Korea’s aviation sector takes flight
Surging investor interest and strategic dialogue marked the Airline Economics Growth Frontiers Korea conference, where airlines, lessors, financiers, and legal experts convened to explore the country’s growing appetite for aviation assets.
The diversification of aviation finance
Reed Smith partner Andrew Harper examines a growing trend towards greater diversification for aviation financing requirements.
Court rules on FWA v VietJet JOLCO
The English High Court confirms enforceability of termination sum provisions in JOLCO structures. By Peter Sharp, James Bradley and Keir Baker in the aviation team at Morgan Lewis. Trainee solicitor Oliver Barnes-Dean also contributed to this article.
Data
Latest aircraft lease rates and values.
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