Boof02671 wrote:smartplane wrote:FLALEFTY wrote:
Usually AD compliance costs are for the lessor, including payment holiday while the aircraft is unavailable. However, if this is an end of life lease, with no end of lease balloon payment for the lessee, then AD costs will usually be for the lessee, not the lessor.
The fleet isn't all leased, and the leased aircraft are in different tranches presumably on different terms (including sub-leased where normal practice is to mirror leases other than payment terms), so some may remain in storage, some flown and others parted. Other than those with inside information, time will reveal.
Not true. The lessee is responsible for all maintenance and costs. It’s Delta owned seats in those planes.
The lessee is responsible for all maintenance, including documentation. Where a lessee leases a new or used aircraft to economic end of life, they will certainly be responsible for meeting all AD compliance costs if not covered partly / fully by the relevant OEM.
Where an aircraft is leased for a period, ending before it's deemed end of economic life, different practices apply. For example, where an aircraft is leased for say 12 years, is deemed to have an economic service life of 18 years, and an AD must be actioned by Y6, the lessee obtains benefit for 6 years, and the lessor potentially for 6 years too. AD compliance costs would be met fully by the lessee when the work is undertaken, with an adjustment at lease end made as a credit against the EOL balloon payment payable by the lessee.
There is an industry arbitration process to determine economic service life and allocation of these costs, if not detailed in EOL T&C's.
In respect to seats / interior fit out, commercial passenger aircraft are either leased inclusive or exclusive, usually covered by a separate side agreement on the aircraft lease, or sometimes in separate documentation.
If the DL leases at time of execution were not deemed end of life, it would seem very likely by now, the lessors would be wanting to re-negotiate to make them end of life, so no possibility they are on the hook for a % of any AD compliance costs. DL on the other hand would want the reverse so costs are shared. In the real commonsense world, this provides leverage to terminate the leases early, with neither party sinking costs into an aircraft with little or no future.
However DL are very savvy negotiators, so it's likely the T's were crossed, and I's dotted on this subject when the leases were executed, or since, giving DL various options, at little or no cost.
