Boeing 737 MAX 8  20190312
A Boeing 737 MAX 8... Dubai Aerospace Enterprise definitely sees possibilities opening now that the UAE regulator has confirmed the aircraft is fit to return to duty. Image Credit: AFP

Dubai: Dubai Aerospace Enterprise (DAE) is in talks with airlines about leasing the Boeing 737 MAX 8 aircraft in its fleet - days after UAE’s aviation regulator lifted its ban on the airplane.

“We are continuously in discussions to provide them with leasing solutions... and it is fair to say that a good number of these discussions are about the 737 MAX 8,” said Firoz Tarapore, CEO of DAE. “Over time, we expect the 737 MAX 8 alongside the Airbus A320neo family to be the cornerstone of the DAE fleet.”

The Dubai-based aircraft lessor has 20 Boeing 737 MAX 8 aircraft with operators. This represents 7 per cent of its owned fleet.

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Still expanding

DAE had previously laid out plans to expand its fleet to 800 jets over the next five years or so. According to the company these plans are still very much on.

“We are focused on growing both our owned asset portfolio and managed asset portfolio,” said Tarapore. “We find that financial investors are gravitating naturally to having their aircraft assets managed by a global, full-service leasing platform like ours.”

DAE will “not grow just growth’s sake,” he added. “We constantly seek to validate that our growth ambitions are properly calibrated with available opportunities in the marketplace.”

Recovery chances

DAE expects travel demand to grow through 2021, particularly in the second-half. This will be driven by a significant ramp up in vaccinations, a more nuanced set of policy responses to spikes in coronavirus cases, and the adoption of a stringent set measures by airlines to alleviate passenger concerns.

“We would also add that there is significant pent-up consumer demand globally with consumer surveys indicting the flying public are eager to travel again once there is more confidence in safety and travel regulations,” said Tarapore. “This will underscore the near-term need for airlines to have the right number of aircraft on hand.”

Raising funds

In the last three months, DAE raised $2.25 billion to fund its growth and refinance upcoming maturities. And looks like it has appetite for more.

“We continuously evaluate issuance opportunities in global capital markets,” said Tarapore. “If there are incremental opportunities to issue debt for liability management purposes without impacting our overall leverage metrics, we’d be favorably inclined to do something.”