Programme overview
Introduction:
Aircraft leasing and aviation finance, covering lease pricing, reserves and residual value, is a 5-day course for airline finance and fleet planning teams, lessors, aviation bankers and investors that ends with a lease versus buy analysis and term sheet for a case aircraft. Airlines and funders lose value when lease rates ignore residual risk, maintenance reserves fall short of shop visit costs, return conditions are loosely drafted and security over the aircraft cannot be enforced. Nominees already price, fund or approve aircraft transactions and work through a modelling build on fleet, rent and appraisal data. CoreConcept Training Center delivers this aircraft leasing and aviation finance course.
Course Objectives:
- Compare aircraft acquisition routes, including direct purchase, operating lease, finance lease, wet lease and sale and leaseback, against a fleet requirement and funding position
- Calculate lease rate factors and lessor yields from aircraft value, lease term, funding cost and residual value assumptions
- Interpret appraisal values and residual value curves to set rent, loan-to-value limits and end-of-lease exposure
- Negotiate maintenance reserve rates, redelivery return conditions and end-of-lease compensation so that cash held matches the cost of restoring the aircraft
- Structure secured aircraft loans and outline export credit support, registering security interests and planning default and repossession steps under the international mobile equipment treaty
- Build a lease versus buy model and a lease term sheet that set out the economics, accounting effect and risk allocation of a case aircraft
Target Audience:
- Airline finance and treasury teams responsible for aircraft funding, lease budgets and balance sheet leverage
- Fleet planning and network strategy teams that decide aircraft type, timing and acquisition route
- Lessor marketing, pricing and portfolio teams that place aircraft, set rents and manage residual exposure
- Aviation bank and credit teams that underwrite secured aircraft loans and monitor collateral value
- Investment and asset management teams that evaluate aircraft portfolios and lessor platforms
- Legal and contracts teams that draft and negotiate lease agreements, security documents and transfer terms
Course Outline:
Day 1: Aircraft as an Asset Class and the Fleet Acquisition Landscape
- Commercial Aircraft Asset Liquidity and Remarketing Characteristics
- Narrowbody Versus Widebody Lessor Appetite and Remarketing Risk
- Fleet Acquisition Routes From Direct Order to Lessor Placement
- Wet Lease, Dry Lease and ACMI Capacity Uses
- Airline Funding Mix Baseline Using Fleet Ownership Data
Day 2: Lease Structures, Rent Pricing and Aircraft Valuation Methods
- Operating Lease Versus Finance Lease Risk and Reward Allocation
- Lease Rate Factor Calculation From Aircraft Value and Term
- Lessor Yield Model With Funding Cost and Residual Assumption
- Appraiser Base Value, Market Value and Distressed Value Definitions
- Residual Value Curves by Aircraft Age and Type
Day 3: Lease Terms, Maintenance Reserves and Funding Structures
- Lease Agreement Term Sheet Key Commercial Clauses
- Maintenance Reserve Rates for Airframe, Engines and Landing Gear
- Redelivery Return Conditions and End-of-Lease Compensation Payments
- Sale and Leaseback Pricing and Purchase Agreement Assignment
- Secured Aircraft Loan Structures and Export Credit Guarantee Overview
Day 4: Security, Default, Accounting Effects and Transaction Risk
- International Mobile Equipment Treaty Interests and Registry Filings
- Lessee Default, Repossession and Deregistration Remedy Sequence
- Lessee Lease Accounting Effects on Leverage and Covenants
- Lessee Credit Assessment and Security Deposit Sizing
- Interest Rate, Currency and Residual Value Risk Hedging
Day 5: Modelling Build: Lease Versus Buy Analysis and Term Sheet
- Case Aircraft Fleet Requirement and Funding Options Brief
- Lease Versus Buy Net Present Value Model Build
- Maintenance Reserve and Return Condition Cost Sensitivity Testing
- Sale and Leaseback Versus Secured Loan Comparison
- Case Aircraft Lease Term Sheet Completion and Defence
Skills You Will Gain:
- Aircraft Acquisition Option Appraisal
- Lease Rate Factor Pricing
- Residual Value Assessment
- Maintenance Reserve Negotiation
- Return Condition Drafting
- Secured Aircraft Lending
- Lessee Credit Analysis
- Lease Versus Buy Modelling
Why Attend This Course:
- Deliver a lease versus buy analysis and term sheet for a case aircraft to the chief financial officer, fleet committee or credit committee for approval
- Decide whether to buy, lease or sell and lease back an aircraft, and at what rent, reserve level and loan-to-value, using modelled evidence
- Avoid under-funded maintenance reserves, disputed redelivery claims and unenforceable security that can turn an aircraft transaction into a loss
- Pass on lease rate, reserve sensitivity and lease versus buy templates to finance, fleet and credit colleagues for later transactions
Conclusion:
Back at work, the participant gives the chief financial officer, fleet committee or credit committee a lease versus buy analysis and term sheet that sets the acquisition route, rent, maintenance reserves, return conditions, security package and risk allocation for a case aircraft. Decision makers use it to approve the funding route and negotiating limits, while legal and treasury teams use the term sheet to prepare lease or loan documents. After the first transaction closed on this basis, the unit should compare agreed terms, funding cost and reserve balances with the model.
Frequently Asked Questions (FAQ):
What should participants know before an aircraft leasing and aviation finance course?
Participants should already work in airline finance, fleet planning, leasing, aviation banking or investment and be comfortable with discounted cash flow and basic lease terms. Bringing an anonymised lease summary or fleet plan helps them apply the modelling build to their own transactions.
How does aircraft leasing and aviation finance differ from an aircraft maintenance management or general lease accounting course?
It concentrates on the economics of acquiring and funding aircraft: rent pricing, reserves, return conditions, valuation, secured lending and lease versus buy. Maintenance management courses cover airworthiness and check planning, and lease accounting courses cover measurement and journal entries rather than transaction structuring.
Why do maintenance reserves matter in aircraft leasing and aviation finance?
Maintenance reserves fund the shop visits and checks an aircraft consumes during the lease, protecting the lessor's asset value and the next placement. Rates set too low leave a funding gap at redelivery, while rates set too high tie up airline cash.
What do participants take back from the aircraft leasing and aviation finance course?
Participants take back a lease versus buy model and a term sheet for a case aircraft, with lease rate and lessor yield calculations, reserve and return condition sensitivities, a sale and leaseback comparison and a security checklist they can adapt to their own transactions.