Published by Global Banking & Finance Review®
Posted on February 26, 2025
4 min readLast updated: January 25, 2026
Add as preferred source on GoogleAerCap CEO Aengus Kelly sees no quick return to aircraft leasing in Russia, citing insurance and regulatory challenges despite potential demand for used aircraft.
By Tim Hepher, Padraic Halpin and Conor Humphries
(Reuters) - The head of the world's largest aircraft leasing company, AerCap, said on Wednesday that Russia may look to buy used aircraft or engines if and when its markets reopen but that he saw no rush by Western lessors to resume renting jets.
Talks aimed at achieving a ceasefire in Ukraine have raised the prospect of a gradual reopening of Russia to Western firms, though the leasing industry remains scarred by the confiscation of some 400 jets following Moscow's invasion of Ukraine in 2022.
Speaking to Reuters after posting record core earnings per share, CEO Aengus Kelly stressed that any business with Russia would have to be approved by the United States and European Union, which continue to impose war-related economic sanctions.
"Now, let's say that occurs, then you'll need insurance. I just don't see insurance occurring, so that means leasing would be a very long putt," Kelly said.
"However, sales are different. Could sales be done with individual asset approval? Possibly. It would be a long putt, but there'll be a big surge in demand to buy used assets."
Kelly said Western repair companies would be reluctant to work on airplanes that have been operating in Russia without current paperwork or approved parts, which would throw a wrench into the trading of parts even if sanctions are lifted.
"I think the real demand will come from discrete assets, like a whole engine or an aircraft. I think it will be difficult to say that an aircraft that has been in Russia has any intrinsic value," Kelly added.
Aircraft lessors have been suing dozens of insurers over losses of at least $8 billion linked to planes trapped in Russia.
AerCap said on Wednesday it had booked settlements in the fourth quarter of $168 million. Kelly declined to comment when asked if the company was nearing any further agreements.
REGULATOR RESOURCES
Kelly said the wider industry continued to face shortages of aircraft and engines, but that supply chains were starting to improve - albeit with question marks over certification delays.
He said it was vital regulators co-operated and had enough resources, and singled out bandwidth at the European Union Aviation Safety Agency. The agency had no immediate comment.
AerCap reported slightly lower 2024 net income of $2.34 billion but a 12% rise in earnings per share to $12.01.
The world's largest buyer of aircraft and engines said it had ordered 118 CFM LEAP engines, though Kelly cautioned that the jetliner business remained a "seller's market".
Kelly said it was too early for Airbus to think about launching a new airplane and urged jetmakers to put the building blocks in place for smooth servicing of the thousands of planes they have already sold before moving to the next generation.
Jetliner deliveries have been delayed by a shortage of engine parts as maintenance shops compete with new assembly lines for parts to deal with unforeseen wear and tear. Kelly said this was improving but that significant issues remained.
"To try and launch a new aircraft before those engine issues are resolved on the existing technology...(it) would be very challenging to get traction in the market," he told Reuters.
Airbus CEO Guillaume Faury has said the planemaker will begin development of a new narrowbody jet before the end of the decade. Boeing has also looked at a successor to its 737 model, before pausing as it became mired in financial and industrial problems.
Kelly said visibility over 2025 deliveries had improved since the start of the year, however, notably at Boeing.
(Reporting by Tim Hepher, Padraic Halpin, Conor Humphries; Editing by Louise Heavens, Christina Fincher and Hugh Lawson)
The article discusses AerCap CEO's views on the potential resumption of aircraft leasing in Russia amid ongoing sanctions.
Challenges include insurance issues, regulatory approvals, and reluctance from Western lessors.
There may be a surge in demand for used aircraft and engines if Russia's market reopens.
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