Airlines to extend deferral of leasing payments for five years

The Ministry of Transport has prepared a draft government decree allowing airlines to accumulate debts for leasing foreign aircraft until 2030. These are amendments to Government Order No. 412 of March 19, 2022, which determines a special payment regime for aircraft leases. Previously, businesses had the opportunity to use the special payment procedure until the beginning of 2025.

Carriers should transfer funds to special C-type accounts until 2030 to accumulate reserves for settling disputes with lessors in the future. However, not all of them actually do it, as the money is lying there dead weight, and foreign lessors do not take it away.

Therefore, some carriers prefer to accumulate debts rather than reserves. The funds envisaged for leasing payments are spent on current expenditures to maintain the airworthiness of aircraft, the Russian Association of Air Transport Operators (AEVT) noted.

The debt per one A320 airplane can now reach $3.6-5.4 million, and by 2030 this figure will approach $9.6-14.4 million, according to Andrei Patrakov, founder of the RunAvia flight safety service. The total debt of the industry for almost 250 unpurchased airliners in five years will be about $2.4-3.6 billion, says the aviation expert.

Until 2030, airlines are allowed to fly on aircraft left in Russia, despite the debts and bans of foreign owners. The permission is valid for contracts concluded with leasing companies until February 24, 2022. After that, airlines will have to decide what to do with the debts.

Unresolved claims on airplanes is a guaranteed ban on flights to many countries, risks of arrest of airliners and inability to work with many counterparties even after the removal of anti-Russian sanctions, says Oleg Panteleyev, executive director of the agency AviaPort.

Read more in the exclusive material of Izvestia:

Those who owe: airlines will be granted a five-year grace period on leasing payments