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| INSIDE | Humble scheme FLYING displays on DAY 1 lifts India to the cusp of a Civil Aviation Revolution 1,000 incentivised short-haul flights to 100 no-frills airports at the heart of India’s take off for the world’s 3rd largest aviation market spot

Pratt & Whitney Customer Training Centre in India Registers 10,000 Student Days of Training P4 Pratt & Whitney’s CSR Activities in India P4 HondaJet Elite to Soon Have an Indian Customer P5 Showcases Range of Commercial Capabilities P5 LATEST ENTRANT: star air promoted by sanjay ghodawat group operates under the rcs- scheme

By VISHAL THAPAR was launched on December 3, 2019. The focus is on increasing air connectivity to the North-Eastern states, thousand new domestic routes and 100 new the hill states, the Union Territories of Jammu and airports in the next five years: That’s the and and the Island Territories of near-term goal powering India’s flight to the Andaman & Nicobar and Lakshadweep. Bids for these Number 3 spot in the world’s aviation mar- routes have been invited. ket at Round 4 of the UDAN Regional Con- The highlight of Round 4 is the increase in the Via- Anectivity Scheme (RCS), which is set to become the bility Gap Funding (VGF) or subsidy cap for Category Profit Hunter Captivates global benchmark for making affordable flying acces- 2/3 aircraft of more than 20 seats operating on RCS Attention @ Wings India P6 sible to teeming millions. routes in these priority areas. With 688 new routes already having been awarded Under the programme, airlines have to cap fares – of which 232 have been operationalised so far – for 50 per cent of the seats to `2,500 per flight hour. Photographs by SP Guide Pubns, across 106 airports and 31 heliports since the launch The loss due to the price cap is compensated by the twitter & respective of the scheme in 2017, UDAN (Udega Desh Ka Aam VGF, which is a grant to the airlines to bridge the gap organisations Nagrik) appears to be reached a take-off stage. between the cost of operations and revenue. Round 4 for opening up a new tranche of routes A key feature of UDAN is that it is not funded

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SP's CAYB AD 2019 for SN.indd 1 30/01/20 9:21 AM shownews SP’s the MoCA added. of theserouteswillbeoperationalisedduringthewinterschedule2019,” made todeveloptheairportsandoperationalisependingroutes. Many of biddingundertheSchemeandawardedabout700routes. Effortsare air connectivity. years” inpriorityareaswhicharesofareitherun-servedorunderserved “operationalise 1,000routesandmorethan100airportsinthenextfive Aviation (MoCA) stated, whiledeclaringisintentionto ing connectivitytonearbyairports,” theMinistryofCivil incentivized todevelopshorthaulroutesonly, provid- be prioritizedforawardof VGF. The marketwouldbe the futureandroutesconnectingsuchairportswould license isalsoallowedinRound4. bid withinaperiodofoneyear. the numberssubmittedin Technical Proposalofits flight operationon agiven route, providedit conforms to tor (SAO) wouldbeallowedtochangethefrequencyof quency offlightoperations. TheSelected AirlineOpera- is theallowanceofflexibilitytoairlinechangefre- in priorityarea. for awardof VGF undertheScheme, followedbynon-AIIairportsbutlocated oped bythe Airports Authority ofIndia(AAI)wouldbegivenhigherpriority routes. to routeswithstagelengthofup600kminorderpromoteshort-haul incentivize theoperationofsmallaircraftunderScheme. Category 1/ A aircraft(under-20 seaters)hasalsobeenrevisedtofurther aircraft operatingontrunkrouteswithhighprofitability. VGF subsidy, aregeneratedwithinthesectorthroughacessimposed onlarge through theGovernmentbudget. Fundsforthisprogramme, includingthe lead “In thelastthreeyearsMoCA hassuccessfullycompletedthreerounds “AAI wouldfocusondevelopingno-frillsairportin Operation ofhelicoptersandseaplanesunderNSOP Another keyfeatureintroducedattheRound4Stage Under awelldefinedPrioritisationframework, airportsalreadydevel- VGF forCategory2/3aircraft(morethan20seats)wouldberestricted The VGF capapplicableforvariousstagelengthsoperationthrough story The highlightofRound 4 istheincrease n aircraft ofmorethan 20 seats operati ng on Viability GapFunding (VGF) orsubsidycap RCS routesinthese for Categ ory 2/3 . priority areas.

3 Day2 common manhasliftedIndiatothecuspofacivilaviationrevolution. • not too distant future. The humble schemetomakeflyingaccessiblethe envisages UDAN driving up growth rates in toas high as 25 percentinthe levels currentlyaslow7to8percent, Civil Aviation MinisterHardeepPuri agency isdefined,” JointSecretaryPadheeobserves. ensured bytheconcernedagenciesinaneco-systemwhereroleofeach become meaningful when there is an integrated supply chain management or under-utilised. sector andleveragingexistingnationalassetswhicharelyingeitherunused the Government, andis, insteadusingfundsraisedcreativelyfromwithinthe masses, shestates. tive istopromotebalancedregionalgrowthandmakeflyingaffordablefor Usha Padhee, Joint Secretary Civil Aviation, in a recentwrite-up. The objec- regional airportsandtransformedthewaycommonpeopletravel,” notes gramme, with40RCSrouteshavingbeenawardedsofar.

India’s airpassengertrafficstandsat345milliontoday. With penetration “As landisofveryhighvalue, theexistingairstripsarelikegoldmines RCS isspecialbecauseitdoesnotdependuponBudgetarysupportfrom “In lessthanthreeyearsofimplementation, UDAN hasopenedup44 Regions like the North-Eastern states are major beneficiaries of this pro-

in North-Eastandtribaldistricts. to improvevaluerealisationofnicheproductsespecially scheme andagriculturemarketinghasbeenenvisaged cultural produce. recently intheUnionBudgetforairliftofselectagri- to accommodatetheKrishiUdaanproposalannounced ous,” statesPadheeontheapproachtoprogramme. cess, sothattheinvestmentwillnotbecomeinfructu- commitments fromtheairlinesthroughbiddingpro- scheme. Upgradationoftheseairstripsdependsonthe entities, allhavebeenbroughtundertheambitof belong tostategovernments, PSUs, defence, private waiting tobeexplored. These airstrips, whichmay “A verticaloffreighterconnectivityunderUDAN will “This convergencebetweenregionalairconnectivity UDAN alsoprovidesafreightconnectivitytemplate WWW.SPGUIDEPUBLICATIONS. COM

wings India 2020 www.spsshownews.com wings India 2020 P shownews SP’s Hyderabad underscoresPratt& Whitney’s long-termvisionandcommitmenttoIndia. Facilitating thegrowthand developmentofanindustryreadytalentpool, thisworld-classtrainingcentrein By SP’sCorrespondent India R Pratt &WhitneyCustomerTraining Centre in special developing arobustskilldevelopmentbaseinthe & Whitney’s long-term vision and commitment of since 2015. OurtrainingcentreunderscoresPratt ing anddevelopingtalentintheaerospacesector “Through ourcentrehere, wehavebeennurtur Sethi, Pratt& Whitney ManagingDirector, India. training centreinHyderabad,” said Ashmita strategically investedinaworld-classcustomer India’ and ‘Make inIndia’programmes, wehave tunities tostudentstrainedbythecompany. & Whitney andwillconsiderofferingcareeroppor the skilldevelopmentinitiativesundertakenbyPratt space organisations have extended their support to of theaviationsectorinIndia. Severalleadingaero- ty skilldevelopmentprogrammes, tospurthegrowth ers, MROoperators, aswellindustryanduniversi- centre offersadvancedtrainingforairlinecustom- DGCA andEASA Part147approvedtrainings. The centres operatinggloballywhichofferspecialised   grams inIndia: operate, wesupportfollowingcorporatesocialresponsibility(CSR)pro- Aligned withourcommitmentofsupportingthecommunities inwhichwe By Ashmita sethi Pratt &Whitney’s CsrActivities In India

“In linewiththeGovernmentofIndia’s ‘Skill Pratt & Whitney, theUniversityofConnecticut(UConn)andEngineers the standardforresultsandaccountability. the communitytocraftsolutions toIndia’s uniquesocialproblems andset , United Way India strives toleveragethe talents andexpertiseof seven cities, , Baroda, , Delhi, Hyderabad, Kolkata and ing the caringpower of communities to build a strongerIndia. Present in Pratt & Whitney supportsUnited Way Indiainimprovinglivesbymobiliz- is oneofthethreePratt& Whitney training Launched in2015, thecentreinHyderabad tomer Training CentreinHyderabad, India. 10,000 studentdaysoftrainingatitsCus- ratt & Whitney hasannouncedarecorded story egisters 10,000StudentDaysofT Launched in2015,HyderabadisoneoftheheeP which offerspialisedDGCAandEASAPart 147 approved trainings. - - for studentsandfacultyfromstatesincluding Telan- centre hassuccessfullydelivereditsprogrammes programs forthebenefitoffacultyandstudents. The successfully conductedspecialisedaviationtraining sities acrossmorethanfivestatesinIndiaandhas has partneredwithleadingstateandprivateuniver ment’s “” initiative, Pratt& Whitney India gana Academy ofSkills&Knowledge. space andaviation,” saidSrikantSinha, CEO Telan- that willpropel toleadershipinaero- ing anecosystemofskilldevelopmentprogrammes with corporatessuchasPratt& Whitney indevelop- of thestategovernment, welookforwardtoworking Telangana. As the premier skill development agency mier aerospaceandaviationhubsinthestateof Whitney Customer Training, India. India,” said Amit Pathak, GeneralManager, Pratt& talent tofuelthegrowthofaviationsectorin thereby helpingcreateapoolofindustry-ready towards aviationskilldevelopmentinthecountry further testifiesPratt& Whitney’s commitment ing attheCustomer Training CentreinHyderabad ecosystem inIndia.” country tosupportthegrowthofaerospace Accentuating itscontributiontotheGovern- “Our visionistocreateoneofthecountry’s pre- “The milestoneof10,000studentdaystrain-

4 Day2  tt &WhitneytrainingcenREsopera

couraging thepursuitofcareers inSTEM.• necessary forsuccessinengineering andtechnologyfields, therebyen- phanages to set upfreeclubsandprovide girlswiththe skills andtools lore, Delhiand Hyderabad. The programpartnerswithschools andor Pratt & Whitney’s in-countryresourcestoexpand codingclubsinBanga- Girls Who Code leveragesUnited Technologies Corporation’s supportand both teachersandstudents. ern facilityequippedwiththetoolsandtechnologiesneededto support serve approximately600studentseachyear. Eachcentrefeaturesamod- tronic educationcourseswithaSTEM emphasis. The e-LearningCentres tres whereelementary-agechildrencanhaveaccesstohighquality elec- Without Borders–Indiahavecollaboratedtoinstall100e-Learningcen- - facturing sector. • ing togrowtheirbusinessintheaerospacemanu- Medium andSmallScaleEnterprises(MSMEs)look- also organisesspecialisedtrainingstargetedtowards India. Apart from universityprogrammes, thecentre space engineeringservicesmajorssuchasBelcan are alsosuccessfullyplacedwithleadingglobalaero- these studentsgraduatingfromprogrammes Underlining thesuccessofthisinitiative, many of at thetrainingcentreduetoitsintensivenature. ents detailedtheoryandpracticaltraining, isoffered on campus, thesix-weekprogramme, whichpres- intensive courses. While theshortcourseisoffered short two-dayseminarstomorefocusedsix-week tomer Training CentreinHyderabadrangefrom the massivegrowthinaviationsectorIndia. ment ofanindustryreadytalentpoolinsupport aviation ecosystem in the country through develop- nerships areaimedatfacilitatingthegrowthofan development programsinthecountry. These part- versities toprovideaerospaceandaviationskill randum ofUnderstandingwithleadingglobaluni- operators representing20nationalities. ana apartfromprovidingtrainingforover30airline gana, Tamil Nadu, , and Hary- The trainingprogrammesconductedattheCus- Additionally, thecompanyhassignedaMemo- ting globally raining WWW.SPGUIDEPUBLICATIONS. - COM B H shownews SP’s cient andcapable airplaneswillenablethisgrowth.” said Darren Hulst, Vice President, Commercial Marketing. “Boeing’s fuel effi- mendous potentialforthecountry’s growthasacommercial aviationhub,” middle classexpandsandmore consumersareableto fly, we’reseeingtre- world-class servicescapabilities toenhanceairlineoperations. “As India’s 787 Dreamlinerand777X, theBoeingexhibitatB8focusesoncompany’s andthemodernisationofairportinfrastructure andairspace.” innovation, productioncapacity, supply chain, aerospaceskillingcentres, investments inIndiathatspanthedevelopmentofaerospace technology, Boeing India. “We lookforwardtotheopportunity tohighlightourongoing country’s aerospacesectorfor thelast75years,” saidSalilGupte, President, is honoredtopartnerwithcustomersandindustryleaders to enhancethe tem insupportof ‘Make inIndia’and ‘Skill India’. ple ofthat. Ithasanefficientengine, aGEHondaengineaswelllessturbulence keeping atabofourcarbonfootprintisveryimportant, andthisaircraftisanexam- that theaircraftismorecomfortableandcostefficient. “ForusatHonda, daJet Eliteboastedofitsefficientdesign. Roadsexplainedhowthedesignensures President ofSales, HondaJetwhilehespoketoSP’s ShowNews. proofing. Henceitisfurther, faster, quitterand higher,” saidSimonRoads, Vice aircraft withagreaterrange, betterrunwayperformance, andimprovedsound sion oftheHondaJetclassic, Eliteisasingle-pilotsix-seater(excludingthepilot) at Singaporelastmonthandwasdisplayduringshow. “An upgradedver an IndianCustomer aerospace technologyandinnovationinIndia Interactive exhibitfeatureshowBoeingandpartnersaremakingstrategicinvestments toadvance Capabilities Boeing ShowcasesRange ofCommercial hopeful thatsoonitwillhaveasignificantchange. The IndianinfrastructuremightrightnownotbeverywelcomingfortheprivateflightsbutHondaJetis HondaJet ElitetoSoonHave special Inadditiontoshowcasingcommercial aviationplatformssuchasthe “ one of the world’s fastest growing aviation markets and Boeing Parked attheBegumpet Airport fortheshow, thebeautifulblueandwhiteHon- safety andindustrypartnershipsindevelopingIndia’s aerospaceecosys- the show. The company’s exhibitfeatureitscommitmenttoinnovation, oeing ishighlightingitsinnovativecommercialproductsand services at 2020, Hyderabad. The HondaJetEliteflewdowntoHyderabadafterbeing Honda’s aircraftcompany, HondaJetmadeitspresenceatthe Wings India aving outperformedmostofitscompetitorsintheverylightjetsector, REports HONDAJET LIONS A TIC DISPLA Y A T BEGUMPAIRPORT

• , HYDERABAD;(right)Smono

5 - Day2 explaining themthelongruncostefficiency,” hesaid. industry andsuchplanesbutitisaboutsellingalifestyletothecustomers of achangesoon. “It mightseemthatthereisalotofflamboyancearoundthis also talkedabouttheinfrastructuralchallengesinIndiabutremainshopeful he toldthatHondaJethavecustomersforownershipandalsochartering. He will beannouncementsofIndia’s firstElitedelivery. Notdisclosingthenames, mental advantages. Fuel andremarkedhowitisasgoodtheusualfuelbuthasbetterenviron- Roads alsosharedtheexperienceofcompanywithSustainable Alternative Jet and noise. Even its exhaust is placed well with an air-frame design,” he added.

Talking aboutthemarketinIndia, Roadsinformedthatsoonthisyearthere

ads, VicePresidentofSalesHondaJet. took pla t BOEING 777Xdebutflight WWW.SPGUIDEPUBLICATIONS.

ce onJanuary25,2020 • —Ayushee Chaudhary COM

wings India 2020 www.spsshownews.com wings India 2020 B shownews SP’s to maximizethe revenuebutatthesametime it showcases, added Pereira. “The ideawas aisle aircraft.” etc. tohavethe most efficient design forasingle- with abetterengine, moreandcomfortableseats, get donewithit. We redesignedthe entireaircraft but our aim was not to justaltertheengine and Pereira said, “E2 wasourguidanceforthedesign SP’s ShowNews. Commercial Aviation duringaninteractionwith Pereira, Vice President Asia Pacific, Embraer been designedtomagnifyprofit, explainedCesar Named asthe ‘Profit Hunter’, thisE-195E2has displayed atthe Wings India2020 inHyderabad. tors who gathered to get a glimpse of the aircraft market withitscomfortableandcost-efficientaircraft. Embraer hopestobridgethepassengercapacitygapinIndian Attention @WingsIndia2020 Profit HunterCaptivates special The aircraftgetsitsnamefrom theconcept Speaking aboutthedesignofaircraft, as theaircraftenthralledmaximumvisi- also managedtobecomethekinginalleyes razil manufacturer, Embraer’s ‘King of Skies’ (ABOVE, LEFT)CesarPeeia,VicePesidentAsiaPa report (top) EmbraerprofithuneE-195E2aircraftos (ABOVE RIGHT)morecomfort

able sea ence ofsuppliers, passengers, media, airlines, etc.• an opportunityformorevisibility forawideraudi- highly comfortableaircraftat Wings Indiatoseek very excitedondisplayingthis state-of-the-art, great opportunitywhichisuntappedtillnow.” is theappropriateoneforthismarket. This isa An aircraftlikeProfitHunter, whichis146seater either thereare70seatersortoolargeaircrafts. between 90and150passengers. However, here “In 2019inIndia, 52percentofflightscarried that it actually istherightmarketforthisaircraft. the newgenerationjets. with thelowestoperatingcostincountry ties thatEmbraerhas, thisaircrafthasbeenbuilt he said. With themarvelengineeringcapabili- reduce thecost, andhenceenhancetheprofit,” This is probably the reason that Embraer is This isprobablythereasonthat Embraeris Further talkingaboutIndia, Pereiraadded cifc, EmbraerCommercialAvia ts ofheaircraft. a

tic displa 6 Day2 —Ayushee Chaudhary y,

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Sr Web Developer: ShailendraPrakash Ashish may bereproduced, storedinaretrieval Web Developer:Ugrashen Vishwakarma Vimlesh Kumar Yadav, SonuSinghBisht by anymeans, photocopying, recording, SP GuidePublicationsPvtLtd. All rights Group Direct E-mail: [email protected] Research Asst-Graphics: SurviMassey planning &busiessdevelopment system, ortransmittedinanyform electronic, orotherwisewithoutprior written permissionofthePublishers. Printed atKalaJyotiPrcoessPvtLtd, reserved. Nopartofthispublication Executive Vice President:RohitGoel Tel: +91(11)24644693, 24644763, Assistant Maager –HR&Admin CHAIRMAN &MAAGING DIRECT Owned, publishedandprintedby PUBLISHER andedit Deputy Manager –Circulation SP GUIDEPBLICATIONS PVTL Lt General(Retd)NareshChand Air Marshal(Retd)B.K. Pandey © SPGuidePublications, 2020 Group ResearchAssociate Jayant Baranwalonbehalfof www.spguidepublications.com Lt General(Retd)P.C. Katoch deputy managing edit For Advertisement /Editorialqueries, Deputy irect GROUP EXECUTIVEedit (Opposite DefenceColony) New Delhi110003, India please contactusatHall‘B’,Stall7 Fax: +91(11)24647093 STAFF correspondent Manager –HR&Admin SENIOR CONTRIBUT Ayushee Chaudhary A-133, Arjun Nagar,A-133, Arjun CREATIVE DIRECT LAY Jayant Baranwal Jayant Baranwal Anoop Kamath SP’s Websites Bharti Sharma Rimpy Nischal Vishal Thapar Rajeev Chugh Pooja Tehlani Survi Massey Neetu Dhulia Neetu Dhulia OUT DESIGNERS Hyderabad or –Sales&Marketing 24620130 WWW.SPGUIDEPUBLICATIONS. or –Sales or-in-chief OR ORS or or TD OR COM

we at sp guide publications (founded way back in 1964 by shri s.p. baranwal, founder publisher and founder editor) are proud to state

First time, SP Guide Publications participated in nomination process for aerospace media awards in 2019 AND, sp guide publications emerged as a winning media with seven articles nominated as finalists under 4 categories whereas, aviation week & space technology group had their five articles nominated as finalists whereas, flightglobal group had their five articles nominated as finalists whereas, ihs jane’s group had their two articles nominated as finalists

and indeed, sp guide publications is further proud to state that it received the award: aerospace media awards - asia 2020 under best propulsion submission for the article “engine leasing” published in SP’S AVIATION 8/2019

Civil Leasing Civil Leasing

an sP GuIde PublIcatIon on more than 130 different aircraft types including regional air- aircraft from either another operator or a financial institution liners, business jets, general aviation aircraft and helicopters. (the lessor). India has ratified the 1997 Article 83bis of the Con- To support this vast market and related Maintenance Repair & vention on International Civil Aviation 1944 which was the first SP’s EnginE LEasing Overhaul (MRO) activities, P&W claims that it offers the largest substantial amendment of the Convention and came about in engine rental and exchange pool of any engine OEM in the form response to industry growth and leasing trends. Under Article of more than 850 engines worldwide to support its MRO activi- 83 bis, a bilateral agreement can be signed between the avia- ties. The other leading engine OEM is CFM International, a 50/50 tion authorities of two contracting states and that agreement Aircraft spare engine leasing is separate from aircraft leasing because engines require more joint company formed in 1974 by Snecma (Safran) in France and transfers and delegates the responsibility for the regulation and intensive technical management GE in the US. Shannon Engine Support Limited (SES), a wholly- safety oversight of an aircraft in accordance with the require-

a-based buyer only) buyer a-based owned subsidiary of CFM International, specialises in provid- ments of the state of registration from that state to the air trans- ing spare engine lease solutions to CFM56 and LEAP operators port authorities in the airline’s home state. DGCA meticulously around the globe. Headquartered in Shannon, Ireland, with maintains a register of aircraft with details of aircraft type,, year By Group Captain a.K. SaChdev (retd) marketing offices in Beijing and Budapest, SES has a portfolio of of manufacture, full name and address of the owner or lessor

100.00 (Ind I over 200 CFM56 and LEAP spare engines, including CFM56-5B, and of the operator or lessee. The notable point is that there is ` aviationSharp Content for a Sharp a udienCe CFM56-7B, LEAP-1A and LEAP-1B engines. SES’ 13 strategic no engine-specific register in India to record separate registra- pool locations give SES both the capacity and the reach to sup- tion title of an engine on an aircraft, whether maintained by www.sps-aviation.com vol 22 ISSUE 8 • 2019 port airlines operating CFM engines worldwide. The Rolls-Royce DGCA or any other registry. The certificate of registration for the & Partners Finance companies (collectively, the “RRPF Affili- aircraft does not include details of the engine(s) mounted on it. ates”) are a collection of 50 per cent owned domestic and foreign military joint ventures with Rolls-Royce, another leading manufacturer of CONCLUDING REMARKS • india inducts 8 apache gunships commercial aircraft jet engines. The RRPF affiliates are primar- Aircraft engine leasing is a highly effective and economical alter- ily engaged in two business activities: lease financing of aircraft native even for large operators who own the majority of their • france strongly pitches 36 spare engines to a diverse group of commercial aircraft opera- engines as they too need leased engines in times of high unsched- additional rafale tors worldwide and sale-leaseback financing of aircraft spare uled engine removals ( UERs), Life Limited Parts (LLP) shop vis- engines to Rolls-Royce for use in their its etc. The flexibility to plan removals, engine maintenance programmes. GE UERs, warranty issues etc, relies upon laSt WOrD: CHaNDrayaaN 2 Engine Leasing Holdings Incorporated the use of leased assets. In reality, failures are pilLArs of success 50 years of is another big name in engine leasing the cost of ownership versus leasing embraer business. Besides these, there are doz- It is pertinent to point can make a huge financial impact on ens of companies like Engine Lease out that International the operators. Although engines are Finance and Willis Lease which have increasingly reliable, they are complex spare engines to lease out for lease Civil Aviation and when they are removed from air- rentals include long term lease on the Organisation has craft for maintenance, repairs can take one end and short term ones, even on a long time to complete. Also, some a daily basis, on the other. Perhaps not provisioned for a events such as bird strike cannot be Shannon EnginE Support LimitEd SpEciaLiSES in providing SparE EnginE LEaSE SoLutionS to cFm56 and LEap opEratorS around thE gLobE the most dynamic part of the engine formal definition of the predicted. Spare engines are a small leasing market is the short term leas- term ‘lease’ in relation segment, around two percent, of the ing segment in the newer narrow body total aviation finance market. in general, the airline industry is capital intensive aircraft down time is expensive in terms of lost revenue, airlines engine types. to aircraft Digital technologies and Artifi- and the aircraft used by it are high cost and long life assets. generally maintain a number of spare engines to ensure air- cial Intelligence are helping airlines Moreover, how these aircraft come to be flying with a particu- craft are not grounded when engines are removed for normal INDIAN SCENARIO reduce spare engine requirements by lar airline is not always the result of a simple purchase form maintenance or as a result of failure. Prior to development of Regrettably, India produces no com- accurately predicting engine removals, the aircraft Original Equipment Manufacturer (OEM). The most the aircraft spare engine leasing business, airlines had to man- mercial aircraft and its entire airline industry is reliant on but spare engines are vital as all engine removals cannot be pre- common modus operandi is a sale and leaseback wherein a age engine removals via spare engine ownership or expensive import of foreign-built aircraft under lease or ownership. The dicted. Although no figure can be put on the number of spare tripartite agreement between the airline that originally booked emergency engine leasing. Aero engine leasing is not as old as Indian scene is dominated by lease in contrast to ownership. engines required by an airline, the generally accepted ratio is an aircraft with the OEM lets a leasing company buy it from the aircraft leasing and not long ago operators owned their engines Aviation finance and leasing are not covered under any specific one for every ten in use. However, local conditions, airline finan- OEM and then the airline leases it from the leasing company. including the spare ones they needed. However, as engines legislated Act in India, but are governed by Indian contract laws, cial health considerations and operational models may dictate Payments to OEMs include options (amounts paid in advance became more powerful and more technically advanced, their Indian company laws and Indian foreign exchange regulations. variations from this thumb rule. There is tough competition PAgE 5 to book an aircraft purchase), purchase rights, deposits and costs also skyrocketed; in addition to initial costs, their mainte- Also, the (Indian) Aircraft Act, 1934, read with the (Indian) Air- amongst the engine leasing market players to provide more and progress payments. While aircraft leases have been in vogue nance costs also increased considerably. Engine leasing became craft Rules, 1937 and the Civil Aviation Requirements (CARs) more attractive and innovative options to lessees. Cost focused ever since airlines started sprouting up, engine leasing market attractive for the same reasons as aircraft leasing in a capital promulgated by the Directorate General of Civil Aviation (DGCA) airlines are increasingly able to reduce the required number of started emerging only around three decades ago. At first glance, intensive, cost conscious resource milieu. When an aircraft is from time to time, governs important aspects of aircraft leasing dedicated spare engines and where possible, rely on the spot leasing of an engine differentiated from purchase or lease of an acquired by an operator, it would normally establish an engine in India. In this context, it is pertinent to point out that Inter- market, pooling or engine availability services. These non- aircraft of which it is a part, appears befuddling, but there are life cycle management plan so as to maximise on wing time and national Civil Aviation Organisation (ICAO) has not provisioned dedicated spare engine services can in theory, increase overall financial reasons for this to happen which have evolved from reduce workshop time to the minimum. This plan aims at find- for a formal definition of the term ‘lease’ in relation to aircraft. asset utilisation across the market and reduce costs for airlines. experience over decades of commercial operations. ing a middle ground between airworthiness perspectives and This is basically because national laws governing lease contracts Another healthy trend is availability of “green time” engines; cost saving considerations over engine life cycle. vary and the negotiating process results in individual variations the term refers to older engines with limited life remaining that ENGINE LEASING Aircraft spare engine leasing is separate from aircraft leas- in the terms and conditions of aircraft leases since these are have been taken from aircraft that have been retired. These are It is customary for a car or a load carrying vehicle to be designed ing because engines require more intensive technical manage- usually tailor-made to specific situations. However, ICAO’s Man- offered into the market by a used parts company and very often to carry a single (the same) engine for its entire life; in contrast, ment. Since engine overhauls are one of the largest airline oper- ual on the Regulation of International Air transport (Doc 9626), they are held on the lessor’s books for very low values and it is an aircraft engine is a replaceable part of the aircraft which gets ating cost segments, each overhaul must be closely managed. describes ‘aircraft leasing’ as the rental rather than purchase of possible for these lessors to offer the engines into the spot mar- YEARS OF replaced several times during an airframe’s useful life, depend- Engine lessors work with airline customers to optimise the cost aircraft by an aircraft operator from another operator or a non- ket at attractive short-term rental and utilisation rates. In gen- ing on aircraft type, utilisation rate, company policies, regula- and ready availability of spare engines at short notice. Pratt & air operator entity. In essence, an aircraft lease is a contractual eral, the trends for the engine leasing market appear to favour SP photograph: www.SES.iE photograph: tory mandates and occasionally due to accidents/incidents. As Whitney (P&W), a leading engine OEM has its engines mounted arrangement in which an aircraft operator (the lessee) rents an the airlines. RNI NUMBER: DELENG/2008/24199 5050APOLLO 11 26 ISSUE 8 • 2019 www.sps-aviation.com www.sps-aviation.com ISSUE 8 • 2019 27

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