Speaking at Airline Economics' 2024 Growth Frontiers Dublin conference, Air Lease Corporation CEO and president John Plueger and SAS CEO Anko Van Der Werff discussed the various geopolitical issues facing the aviation industry.
"A month ago, we didn't have the conflict in the Middle East. Right now, a year and a half ago, we didn't have Russia and Ukraine," said Plueger. "And of course, it's no secret the US relationship with China is extremely strained. I can never remember a time in my career where these geopolitical issues are at the forefront."
Plueger said that there was "no way of knowing" the conflicts as they came but that they "are the realities that we deal with."
With geopolitical issues becoming further to the forefront for the aviation industry, Plueger said: "We are spending a lot more time thinking and planning more about these geopolitical events and the interesting part is with no way to predict them, they just sort of happen. And I hope we don't have any other surprises in the next one, two, or three, five, ten years. History would probably say otherwise."
However, despite the mounting tensions, global overall traffic still remains strong. Furthermore, in turn the aircraft supply side remains in high demand. "I can't remember a time in my career in almost four years where I've seen such a strong demand," said Plueger.
He added: "We just announced in our third quarter call that we are now 100% placed to over deliveries in 2025. And by the way, that includes all of our passenger widebody deliveries as well. The demand has been that strong. But then also on the secondary side, all of our aircraft is new and used with even the used ones, even mid-life widebodies."
Plueger highlighted that the GTF engine issues had "really caused a lot of havoc" but are "doing the best we can to help there, but it's had a pretty profound effect because you can't get your engine into the shop." However, he added: "I do think Pratt will get through these issues... they've been stepping up the plate financially with us and our airline customers."
Overall, the environment seems positive for lessors as the "extremely strong demand" for aircraft persists into 2024.