Alternatives to Direct Purchase Help the Industry Grow

By John N. Feren, Vice President, Boeing Commercial Airplanes Leasing and Asset Management

Boeing Leasing and Asset Management is responsible for marketing and placing Boeing products with our customers. The group maintains regular contact with customers in order to be ready to support their evolving business requirements.

Providing solutions, including alternatives to direct purchase, is an important part of the group's charter. Leasing is a major focus, typically accounting for 25% to 30% of the industry's delivery volume.

We cooperate closely with the Boeing Capital Corporation's Asset Management group to remarket and lease new and used aircraft in conjunction with Boeing Sales. This sometimes involves the sale of non-Boeing products. When the market is strong, we hold few assets. But when the market is softer, we may be called upon to hold assets for future sales. On the other hand, BCC Asset Management manages more than 500 aircraft in its portfolio as a combination of notes, leases and aircraft held for sale.

Our team has the capability to appraise, inspect, accept, and deliver planes taken in trade. Our professionals in this area know the regulatory requirements, value of ship's records, and condition of high-value components. In fact, we have a dedicated engine expert as part of the team.

We develop proactive fleet solutions, providing for bridge lift and for disposition of airplanes that will be replaced. This includes working with Commercial Aviation Services to coordinate aircraft modifications and freighter conversions.

We facilitate fleet transitions and help place Boeing aircraft with lessors by working with financial institutions to develop business assistance for prospective customers. To ensure a quality placement, we make sure that airplane capabilities match the prospective operator's needs, and plan a delivery timetable that meets the financial and lift requirements of all stakeholders.

Alternative solutions, in all their forms, ultimately produce a larger operator base, higher residual values, and greater liquidity for Boeing assets. The people of the Leasing and Asset Management group are dedicated to meeting the needs of our customers, staying informed on market developments, and providing creative solutions to help the industry grow.