Sunday, November 18, 2007

Dubai Aerospace Enterprise


Dubai Aerospace Enterprises (a new leasing company) order of 70 A 320s + 30 A 350s + 10 B 777-300ERs + 70 B 737NGs + 5 B 747-800Fs + 15 B 787s. DAE also signed a deal with EK which entailed it buying 8 A 332s from the airline for US$ 500 million and then leasing it back to the carrier.

Analysis :

DAE is a new leasing company being supported by Emirates & the DXB Govt. For a start up, they have announced themselves as a future force to be reckoned with by placing this large order for narrow & wide bodied aircraft. What is pleasing to see is the variety of aircraft ordered by DAE which are the most popular ones for airlines to use in the future and present.

With regards to the B 773ERs on order, they can easily find interested customers ranging from the GCC airlines to Indian carriers, PK, and even the North American carriers who are actively scouting the market for suitable aircraft to cater towards their long haul international expansion from 2011 onwards.

As far as their order of 15 B 787s go, they should look at placing them with airlines who are looking for medium density long haul aircraft to replace B 767s / AB6s / A 310s etc as well as those airlines who feel that the capacity of their A 330s / B 777s is too big for certain medium haul flights. The latter point bears fruit for Saudia Airlines who find it extremely difficult filling up their B 772s on EU bound flights. The former point applies to airlines such as PIA and AZ who need B 787s asap to replace their aging fleet of A 310s and B 763ERs respectively.


With regards to the A 350s they've ordered, DAE should actively pursue contracts with airlines that need to replace A 330s / B 777s & A 340s from 2015 onwards. Airlines that fall into this category are MEA, VN, UL, SAA, TK, MH, GA, TG, MS & PAL. Other types of customers they should consider going after are those that need A 350s to fuel robust international expansion such as Kingfisher Airlines, Oman Air etc.

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