Lease Corporation International (LCI) is in a unique position of covering the commercial aircraft and helicopter market with a pipeline of orders for the Bombardier CSeries and the AgustaWestland helicopters.
Following its AW139, AW169 and AW189 order announcement in February at the Dallas Heli-Expo, the commercial aircraft operating lessor set up a helicopter division as it looks to be an active player in the rotary market.
Talking to Flightglobal, LCI's executive chairman Crispin Maunder is confident the company can handle both sectors.
LCI plans to grow its helicopters business on its successful commercial operating lease platform and will extend its team with the recruitment of helicopter industry veterans.
"Both industries have parallels but also significant differences," he explains. "We are dealing with different customer bases as well as geographic markets. The helicopters are not operated the same way as commercial aircraft. Helicopters are operated under wet-lease contracts and therefore being operated for a single source of income, whereas commercial aircraft have multiple income sources."
Maunder also points out differences at product levels. "Assets are different. Helicopters have a simpler structure than commercial aircraft and have a longer life span. They [are also] less sensitive to oil prices because they are generally operated on wet-leases where fuel is paid for by the customer."
The main difference between the two markets is from a technical perspective, says Maunder. However, he does not see any challenges for most of his teams "The legal and contract, sale and marketing teams, as well as accounting is similar," he adds.
LCI carefully conducted a SWOT analysis on the helicopter assets. "The helicopter market is growing reasonably fast but in a controlled way. It is a very conservative market compared with the commercial aircraft market," says Maunder.
The medium and large helicopter fleets account for 6,500 units, with an estimated 25% of applications in the offshore oil and gas market and about 10% in the search and rescue market, he adds. The main applications are recreational, aero-medical transport, air taxi, as well as the corporate and VIP sectors.
Moreover, LCI invested in new technology products with the AW139, AW169 and AW189 fleets and the 110- and 130-seat CSeries.
Deliveries of the AW139 will begin next year, while the AW189 variant is due in late 2014. The lessor will take delivery of its first CSeries aircraft in the second half of 2014, with the CS100 model. The CS300 variant will come in 2015, according to Maunder.
"We will have the same approach in terms of financing both orders. We will be providing equity and raise financing via the commercial debt market, although we have options to go for export credit agencies support," he says.
Maunder points out that the CSeries is a very good asset and will book more orders once the first flight is performed.
He is confident the delays to the CSeries will be negligible. "Certainly the airline industry is sceptical about OEMs performing on schedule. Look at the 787 and A380 programmes. Bombardier's delay on the CSeries seems to be modest. They have a lot of experience in rolling out new aircraft."
As of 1 July, Bombardier's order book totalled 138 firm orders, with LCI accounting for three CS100s and 17 CS300s.
LCI has shown an interest in both types, although the CS300 received more enquiries. "Airlines are looking at replacing old aircraft in the 90-120 and 150-seat markets with both versions of the CSeries. We are not in active placement mode yet but once the aircraft flies, interest for the CSeries will accelerate," he adds.