Aviation leasing market hits new heights

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The seven companies that signed the latest orders for the aircraft in Zhuhai are: China Development Bank Financial Leasing, ICBC Financial Leasing, CCB Financial Leasing, Bank of Communications Financial Leasing, CMB Financial Leasing, SPDB Financial Leasing, and Jiangsu Financial Leasing.

Ma Hong, president of China Development Bank Leasing, said the company sees the signing as an opportunity to expand comprehensive cooperation with COMAC on introducing domestic aircraft to the market. It is also an opportunity for aircraft asset management, aviation financial market research, domestic aircraft value assessment, and talent exchanges.

Purchasing and leasing are the two main ways in which airlines introduce new aircraft. If carriers buy aircraft, they naturally acquire ownership, but for leasing, they only obtain the right of use, not ownership.

Aviation experts said that with airplanes costing large sums — especially for large passenger jets — some airlines have found it difficult to pay for new planes in full, so they generally prefer leasing.

Lin Zhijie, an aviation industry analyst and a columnist at Carnoc, a major civil aviation website, said: "China's financial leasing companies, relying on their parent banks, boast the advantages of financial strength, low financing costs, more customer groups, and more advantages in heavy-asset industries such as the aviation industry. In addition, favored tax policies in China have helped boost growth of the aircraft leasing sector.