AerCap's chief executive warned market participants to avoid knee-jerk reactions to short-term geopolitical and economic shocks, underscoring the long-dated nature of the aircraft leasing business.
Addressing attendees at the industry’s largest annual conference, Aengus Kelly framed aviation financing as a sector governed by extended cycles in assets and contracts. He highlighted the longevity of the industry’s core instruments, noting that aircraft are long-cycle 25-year assets and that typical leases last about 12 years. In his remarks, Kelly said: "You have to stay to True North. This is a very long-term business, with long-cycle 25-year assets, leases that are 12 years. You just can’t react to what’s happening on a day-to-day basis in the media or in the political spectrum."
Kelly acknowledged that risks exist but cautioned that those risks should be weighed against the structural timeline of the business. "I’m not saying there aren’t risks out there, but you do have to remember you’re looking at a very long-term business," he added.
The comments came at the Airline Economics event, which the company says draws more than 5,000 delegates. The gathering functions both as a sign of the sector’s evolution into an alternative asset class and as a gauge of global economic and trade tensions.
Kelly linked the recent surge in gold prices to currency moves as much as to broader risk sentiment. "Some would say about the price of gold that we’ve had a depreciating major currency for many years... but I know that gold is often seen as a hedge for risk too," he said. He contrasted that with other market indicators, noting that U.S. Treasury yields remain "reasonably low."
When asked whether investor appetite for dollar-denominated assets like aircraft has softened - an appetite that has supported the leasing sector in recent years - Kelly was categoric: "We see absolutely no sign of that. There’s no alternative."
The session also drew questions about how recent political and economic tensions highlighted at last week’s Davos meeting are reverberating through markets. Kelly’s message was essentially one of discipline: align decisions with the long-duration nature of assets and leases rather than short-term headlines.
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