WET LEASING

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Context

• In efforts to boost international air traffic, the civil aviation ministry has allowed Indian airlines to take wide-body planes on wet lease for up to one year.

 

What is wet leasing?

• Wet leasing means renting the plane along with operating crew and engineers, while dry leasing refers to taking only the aircraft on rent.
• The technical term for wet leasing is ACMI which stands for aircraft, crew, maintenance and insurance.
• These are the aspects of the operation that the wet lease airline takes care of, while the airline client will still be responsible for paying for direct operating costs such catering and fuel as well as fees such as airport fees, ground handling charges and navigation fees.
• Operations of an aircraft on wet lease is not encouraged by the Directorate General of Civil Aviation (DGCA) as the crew is often not approved by Indian authorities. Also, wet leasing is generally a short-term arrangement, as it is more expensive than a dry lease.

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Why airlines lease aircraft

• A lot of planes used by airlines in India are not owned but leased. Airlines and aircraft operators prefer leasing planes in order to avoid massive lump sum payments that buying them would entail, and to quickly increase capacity, perhaps temporarily, on certain routes or sectors.

 

https://indianexpress.com/article/explained/what-is-wet-leasing-of-aircraft-for-which-govt-has-relaxed-rules-8294935/