Go First fleet retention may dent SLB model for Indian carriers
NEW DELHI: The sale and leaseback (SLB) model used by airlines globally to raise funds could get a serious dent in India after Go First used the voluntary insolvency route to prevent unpaid lessors from repossessing their aircraft.
Top officials of leading airframe and leasing companies say the example set by Go First will push by risk premium for aircraft being given to desi airlines. And airlines considered “not good credit” could be given two choices — pay higher lease and retain SLB value or retain current lease rentals with lower SLB.
Airlines in India, starting with IndiGo, have successfully used this route to generate funds. Depending on the customer’s creditworthiness and size of order, airframe and engine makers offer a discount on the list price of their offering.
