By Robert Wall
LONDON--The strong dollar is making the leasing of planes more
difficult for some airlines outside the U.S. though overall demand
for rented jets remains good, the chief executive of Irish leasing
company Avolon Holdings Ltd. (AVOL) said Wednesday.
"In the emerging world there are pockets where there are some
challenges driven less by demand but more by dollar strengthening,"
Domhnal Slattery said in an interview. Low oil prices, which ease
cost pressures on airlines, are helping to mitigate the currency
effect, he said.
Avolon on Wednesday announced a 36% rise in first-quarter net
income to $49 million on a 30% rise in sales in the three months to
March 31. The company has already found operators for all new
planes it is due to receive this year and next, Dublin-based Avolon
said.
Key markets are healthy with U.S. carriers posting strong
results, Mr. Slattery said, adding that "we are actually seeing the
European airlines for the first time in many, many years looking a
bit more positive."
Russia, where a plunging ruble and economic weakness hit demand
last year, also appears to be stabilizing, said John Higgins, the
company's chief commercial officer. "We see the potential for some
recovery in the market," he said. Avolon has leased planes to
Aeroflot (AFLT.MZ), Russia's largest carrier.
A decision by Airbus Group N.V. (AIR.FR) to cut planned
production of the A330 widebody should help sustain pricing for
leases of such planes, which has shown some weakness, Mr. Slattery
said. Airbus said this year it would cut output of A330s to six
planes a month from 10 in 2016.
Write to Robert Wall at robert.wall@wsj.com
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