Delta's Aircraft Lessors Fight Back

[Flying Titan]

From ATW Online -
Friday, January 13, 2006 -

Antitrust motion filed by unsecured creditors of Delta Air Lines against certain aircraft bondholders "highlights the growing strength of lessors from the tightening of the worldwide aircraft market," according to debt and equity research firm CreditSights. Proposed lease rates for the 89 older aircraft "are above current market [rates] with return conditions significantly improved," CreditSights stated. The aircraft are a mix of MD-88s, 757s and 767s between 13 and 22 years old backed by Equipment Trust Certificates. The 59 ETC holders apparently have told Delta it must take all or none of the aircraft as a package. The airline has little leverage, according to the firm, because it has no new aircraft on order nor could it find replacement capacity in the aftermarket should it decided to return the aircraft.

 

[aislehopper]

This could backfire. If DL returns the A/C and finds itself short, it could spark a more rapid consolidation with DL acquiring (or being acquired) to obtain A/C for DL's routes.

I doubt that the ETC holders really want the A/C back.

 

[Walmartgreeter]

"highlights the growing strength of lessors from the tightening of the worldwide aircraft market," ........ The aircraft are a mix of MD-88s, 757s and 767s between 13 and 22 years old .....


Yeah...right. This only thing tightening is the sphincter muscles of said lessors as they try this all or nothing bluff. I am not buying that there is a tight market for 13 to 22 year old aircraft, especially at $60 a barrel, even overseas. Greeter.

 

[DalMD88]

The rumors we have been hearing are nearly all the leases have been settled. So far I've only seen three 767-300(nonER) go back. Ships 116,117, and 119 have been sent to VCV.

 

[DeltaAir423]

The rumors we have been hearing are nearly all the leases have been settled. So far I've only seen three 767-300(nonER) go back. Ships 116,117, and 119 have been sent to VCV.

Ship 101 left Thursday afternoon for the cargo mod and on to ABX.

 

[WorldTraveler]

DL has said 90+ percent of the leases have been renegotiated and have hinted they are at better than expected rates - esp. for MD80s and CRJs. The non-ER 767s were nearing their life cycle anyway so I'm sure DL offered up a few just to show they were willing to let a few a/c go if necessary. The 762s were already largely sold to ABX since they were owned and aren't affected by the lease restructurings.