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Formed in 2007. Commercial jet airplane leasing business.
UNITED ARAB EMIRATES (UAE) (AL IMARAT AL-ARABIYA AL-MUTTAHIDA): POPULATION: 3.5 MILLION. A FEDERATION OF 7 SHEIKDOMS, UNDER BRITISH PROTECTION UNTIL 1971, THE (UAE) HAS ROCKETED IN A GENERATION FROM RURAL AND POOR, TO URBAN AND OIL-RICH. THE MEMBER STATES ARE ABU DHABI, AJMAN, DUBAI, FUJAIRAH, RAS-AL-KHAIMAH, SHARJAH, & UMM-AL-QIWAIN. A FAVORITE DESTINATION FOR TOURISTS TO THE ARABIAN PENINSULAR, THE (UAE) IS NOTABLE FOR ITS LARGE POPULATION OF GUEST EX-PATRIOT WORKERS, MANY FROM INDIA AND PAKISTAN, AND ITS GENERALLY PROGRESSIVE ATTITUDE TOWARD WOMEN. THE (UAE) COVERS AN AREA OF 83,600 SQ KM AND ITS CAPITAL CITY IS ABU DHABI. THE OFFICIAL LANGUAGE IS ARABIC.
Dubai can either refer to 1 of the 7 Emirates that constitute the (UAE) in the eastern Arabian Peninsula, or that Emirate's main city, sometimes called "Dubai city" to distinguish it from the Emirate. The modern Emirate of Dubai was created with the formation of the United Arab Emirates (UAE) in 1971. However, written accounts documenting the existence of the city have existed at least 150 years prior to the formation of the (UAE). Dubai shares legal, political, military and economic functions with the other emirates within a federal framework, although each Emirate has jurisdiction over some functions such as civic law enforcement and provision and upkeep of local facilities. Dubai has the largest population and is the second largest Emirate by area, after Abu Dhabi. As of 2007, 800 new residents were setting up home in Dubai every day. With Abu Dhabi, it is one of only 2 Emirates to possess veto power over critical matters of national importance in the (UAE). Dubai has been ruled by the Al Maktoum dynasty since 1833. The city's current ruler, Mohammed bin Rashid Al Maktoum is also the VP & Prime Minister of the (UAE).
Revenues from petroleum and natural gas contribute to <3% of Dubai's US$ 46 billion economy (2006). A majority of the Emirate's revenues are from the Jebel Ali free zone (JAFZ) and, increasingly, from tourism and other service businesses. Dubai has attracted world-wide attention through innovative real estate projects and sports events. However, this increased attention, coinciding with its emergence as a world business hub, has also highlighted human rights issues concerning its largely foreign workforce.
Dubai is the fastest growing city and tourism destination in the World. In the past two decades, Dubai has emerged as a regional business hub and trade destination with a massive geographical reach from West Africa across the entire Middle East and through to Central Asia. Dubai is the place to do business in the region. The city itself boasts population growth estimated at >30,000 new residents a month and this has contributed to hundreds of billions of dollars of investment in infrastructure and property development. The city is a fascinating place where the modern and traditional stand side by side. Dubai offers some of the worlds best shopping, golf courses, beaches, fantastic hotels and bustling souks, all combining to make this one of the world's most exciting cities.
November 2007: Dubai Aerospace Enterprise (DAZ), which aims to make its mark in just about every aspect of commercial aviation, served notice at the 10th Dubai Air Show of its intention to "quickly become a leader in the airplane leasing business" with the signing of letters of intent (LOI) for 200 Airbus (EDS) and Boeing (TBS) airplanes worth just >$27 billion. Adding to the words of (DAZ) Chairman Sheikh Ahmed bin Saeed Al-Maktoum; Managing Director Omar bin Suleiman said, "In 6 short months, (DAZ) Capital has built a business from scratch, through its strong management team and clear vision of becoming one of the top leasing companies globally."
The Boeing (TBC) order is for 70 737NGs, 5 747-8F freighters, 10 777-300ERs, and 15 787s, while Airbus (EDS) received a commitment for 70 A320s and 30 A350 XWBs. (TBC)'s order was valued at $13.7 billion at list prices, with the (EDS) airplanes worth around $13.5 billion. Deliveries of the (TBC) airplanes will start in 2010 and continue through 2018, with (EDS) deliveries beginning in 2013 and ending in 2022. (EDS) President & (CEO) Tom Enders said he expects (DAZ) to close on its deal before year end.
(DAZ) said it already has reached a $1.2 billion accord with Rolls-Royce (RR) on the (Trent XWB)s needed to power the A350 XWBs, while (GE) announced that (DAZ)'s 777-300ERs will be powered by the (GE90-115B) and its 747-8s will use the (GEnx). Those orders are valued at $770 million at list prices. (CFM) International, meanwhile, announced a (CFM56-7B) contract covering the 70 737s worth about $945 million at catalog rates. Those airplanes should deliver in 2010 through 2015, (CFM) said.
(DAZ) Capital (CEO) Bob Genise said the orders "will help us meet the demand for new airplanes, particularly in the Middle East and Asia, over the next decade or more." He told media here that no customers have been secured so far, and that efforts to lease the airplanes will start closer to the delivery date. He expects approximately 25% of the leases to be to operators in the Gulf region with 35% coming from the Asia/Pacific, 15% from the USA, and the balance from Europe.
(DAZ) Capital is one of (DAZ)'s 6 segments that eventually will be based at the new Dubai World Central airport, being constructed at Jebel Ali. The other divisions are (DAZ) Airports, (DAZ) Engineering, (DAZ) Manufacturing, (DAZ) Services, and (DAZ) University, the combination of which is designed to "allow customers to benefit from a world class shared knowledge and service pool," (DAZ) said.
Photo above shows (left to right) Bob Genise (CEO) (DAZ) Capital; Managing Director Omar bin Suleiman; Boeing Commercial Airplanes (TBC) President, Scott Carson; (DAZ) Group (CEO) Bob Johnson; & (GE) Aviation (GEF) (CEO) Scott Donnelly at the signing ceremony.
Only a day after announcing its massive 200-airplane order from both (EDS) and (TBC), (DAZ) Capital unveiled two deals that continue to kick-start its leasing venture. The 1st involves buying 8 Emirates Airlines (EAD) A330-200s and leasing them back to the airline. The 2nd, worth $1 billion, covers the purchase of 10 737 and 10 A320 leases from (GECAS) (GEF) and incorporates 11 customers from 10 countries. Dubai Air Show organizers said the (EAD) buy is valued at $500 million. (DAZ) Group (CEO) Bob Johnson told media here, "(DAZ) Capital has become an airplane leasing and finance provider, that has made the world sit up and take note. We are tangibly fulfilling our aim of rapidly building a world class global aerospace, manufacturing and services enterprise." (GECAS) (GEF) (CEO) Henry Hubschman added, "(DAZ) continues to evolve and transform the aviation sector in Dubai and we are pleased to contribute to this ambitious plan. As 1 of 6 divisions, (DAZ) Capital can offer something, few others can match, and we're delighted to support their aims to become one of the largest airplane leasing companies in the Middle East."
Mubadala Development, Abu Dhabi's government investment firm, became sole shareholder of Gulf Aircraft Maintenance (GAMCO) following its acquisition of Gulf Air (GUL)'s 40% stake in the company. It consequently renamed the Maintenance Repair & Overhaul (MRO) company as "Abu Dhabi Aircraft Technologies (ADAT)." SR Technics (SWS) and Abu Dhabi Aircraft Technologies (ADAT) (formerly GAMCO) announced a collaboration at the 10th Dubai Air Show, under which the companies will work to "complement and maximize" their areas of expertise and provide customers in the Middle East, India and Europe "with a wider range of service offerings." (SWS) will subcontract component repair work in the Middle East to (ADAT) and will provide support to its technical fleet management operations. (ADAT) expects revenue to increase from $300 million currently to $800 million by 2012. Mubadala Development owns 100% of (ADAT) and, along with Dubai Aerospace Enterprise (DAZ), and Istithmar, holds 90% of (SWS).
January 2008: Boeing (TBC) finalized Dubai Aerospace Enterprise (DAZ)'s 100-airplane order valued at $10.9 billion, pushing its total 2007 commercial airplane orders to well >1,300, a single-year record. (TBC) and (DAZ) signed a letter of intent (LOI) for the order, which includes 70 737NGs, at the Dubai Air Show.
July 2008: At the Farnborough Air Show, Dubai Aerospace Capital (DAZ) firmed a Memo of Understanding (MOU) signed at the Dubai Air Show in November for 30 A350-900s and 70 A320s worth $12.6 billion.
(DAZ) is acquiring through what it says is a "split purchase and leaseback deal" 10 747Fs and 8 777-200Fs previously ordered by Emirates (EAD). (DAZ) said the agreement will increase its leasing portfolio to 49 airplanes, with a further 200 on order for delivery between 2010 and 2013.
Bob Johnson stepped down as head of Dubai Aerospace Enterprise (DAZ), announcing his retirement at age 60, just 2 years after he was appointed (CEO) of the high-flying aerospace company ahead of the 2006 Farnborough Airshow. George Mushahwar was named acting (CEO). He previously was (COO) of Dubai-based (TECOM) Investments. In a statement, Johnson said (DAZ) has made significant strides over the past two years, "but now is the right time for me to retire. (DAZ) already has in place a team of exceptionally talented people who will continue to take the company forward and develop its businesses on a global stage." Johnson served as President & (CEO) of Honeywell (SGC) between 1999 and 2005, and subsequently was named Chairman. Prior to becoming (CEO), he headed AlliedSignal Aerospace. AlliedSignal acquired Honeywell (SGC) in 1999, and took the Honeywell (SGC) name. Johnson began his career at (GE) Aircraft Engines (GEC) in 1969.
September 2008: (DAE) Capital (DAZ) said it signed a deal with Aviation Partners Boeing (APB) to purchase 50 blended winglet shipsets for 737-700s/-800s. Delivery will begin in 2010.
January 2009: (DAE) Capital (DAZ) signed a sale and leaseback contract with Air New Zealand (ANZ) covering 2 777-300ERs. The lease terms are for 12 years and the airplanes are due to be delivered in January and March 2011.
SEE ATTACHED - - "DAZ-NEWS-2009-01."
March 2009: (DAE) Capital, the airplane leasing arm of Dubai Aerospace Enterprise (DAZ) signed an operating lease agreement with Garuda Indonesia (GIA) for 8 737-800s. The deal is a sale-and-leaseback transaction covering airplanes scheduled to begin delivery in June. The 8 737-800s covered in the contract are the 1st of 50 737NGs (25 firm plus 25 options) that (GIA) ordered at last year's Singapore Air Show.
Delivers 1st 777-F1H (35606, A6-EFD) freighter to Emirates (EAD) (to be operated by Emirates Sky Cargo (EMC).
November 2009: Dubai Aerospace Enterprise (DAZ) announced at the Dubai Air Show that (DAE) Capital, its airplane leasing and financial business arm, selected (IAE) (V2500) engines to power 20 of its new A320s for delivery from 2011. The order is valued at $340 million. The 20 airplanes are part of a 70-airplane order the leasing company announced in July 2008.
Bob Genise (CEO) of (DAE) Capital (DAZ) said that (DAZ) has been following the sharklet program for the A320 and will be talking with Airbus (EDS). He also told media that leasing rates had dropped about -25% but bottomed out in May and are showing signs of recovery.
August 2010: Dubai Aerospace Enterprise (DAZ)’s leasing arm (DAE) Capital has cancelled orders for 7 A350-900s and 18 A320s. The latest Airbus (EDS) orders and deliveries summary for July lists only 23 A350s and 52 A320s as being on firm order by (DAZ). The original order was for 30 A350s and 70 A320s. (DAE) has been hard hit by the financial crisis that has been particularly severe in Dubai, making access to capital much more difficult. Unlike other leasing firms, (DAE) failed to recover quickly enough to be able to sustain the original orders. (DAE) also cancelled commitments for 15 787s and 10 777-300ERs.
February 2011: Dubai Aerospace (DAZ) has canceled an order for 32 of Boeing (TBC)’s 737s, which could cost (TBC) some $2.3 billion. FlyDubai (FDB) still has 35 of the planes on order.
March 2011: Airbus (EDS) revealed that Dubai Aerospace Enterprise (DAZ)'s (DAE) Capital aircraft leasing unit has canceled another 30 firm orders comprising 18 A320s and 12 A350s.
DAE (DAZ)'s order book, now comprises 34 A320s and 11 A350-900s, or fewer than half of the 100 airplanes (DAZ) originally ordered from Airbus (EDS) in 2007.
(DAE) leapt into the aircraft leasing business at the 2007 Dubai Air Show with orders for 200 aircraft, divided evenly between Boeing and Airbus, with a combined list price value of >$27 billion (ATW Daily News, November 13, 2007). The original commitment with Airbus was for 70 A320s and 30 A350s, but (DAE) has now canceled 36 A320s and 19 A350s.
Last month Boeing confirmed that (DAE) had canceled 32 737NGs out of the 70 it had on order.
July 2011: Dubai Aerospace Enterprise (DAZ)'s (DAE) Capital aircraft leasing unit canceled the remaining 45 airplanes it had on order with Airbus (EDS).
(DAE) leapt into the airplane leasing business at the 2007 Dubai Air Show with orders for 200 airplanes, divided evenly between Boeing (TBC) and Airbus (EDS), with a combined list price value of >$27 billion.
The original commitment with (EDS) was for 70 A320s and 30 A350s, but it had already axed 55 of those airplanes. The latest orders to get cut were for -34 A320s and -11 A350-900s.
(DAZ) followed its recent Airbus (EDS) order cancellations by axing orders for 35 Boeing (TBC) 737NGs valued at $2.8 billion at list prices. (TBC) still lists orders for 6 777s and 15 747-8Fs from (DAZ).
September 2013: Dubai Aerospace Enterprise (DAZ), which owns StandardAero, confirmed it is in preliminary discussions with the UK’s (BBA) Aviation about a potential combination of certain parts of its business with (BBA).
May 2017: News Item A-1: In another instance of aircraft leasing firm consolidation, Dubai Aerospace is buying (AWAS) (AWW), which tended to specialize in renting planes to airlines with lower credit ratings (taking more risk, in other words, but charging higher rates). Based in Dublin like many lessors, (AWAS) isn’t small, sporting a portfolio of >250 jets.
News Item A-2: Dubai Aerospace Enterprise (DAZ) signed long-term lease agreements May 1 for 10 ATR72-600 regional turboprops with Air India (AIN)/(IND) regional subsidiary, Alliance Air. The aircraft are scheduled to deliver throughout 2017 and will be used to grow Alliance Air’s network.
The carrier is particularly focused on serving under-served or un-served airports in India as part of the Indian Government’s Regional Connectivity Scheme (RCS).
Alliance Air is 1 of 5 airlines selected to serve routes under this scheme and will be the 1st to start services under its auspices. “(DAZ) commends India’s government for introducing the (RCS), which should further promote regional growth and make flying affordable for the masses,” (DAZ) (CEO) Firoz Tarapore said.
The deal comes just weeks after (DAZ) acquired a large portfolio of ATRs from (GE) Capital Aviation Services (GEC). (DAZ) has said it plans to own up to 100 of the Franco-Italian turboprops.
At present it has 57 owned and committed ATR72-600s in its fleet.
Alliance Air began as a low-cost arm of Indian Airlines (AIN)/(IND). As part of the merger with (AIN)/(IND), it was renamed "Air India Regional."
Alliance Air operates air services to 36 destinations with an existing fleet of 8 ATR72-600s in a 70-seat layout as well as 2 older ATR42-320s in 48-seat configuration.
Flights are operated mostly to what it describes as Tier-2 and Tier-3 Cities, or those which link these cities to hubs at Delhi, Kolkata, Mumbai, Bengaluru and Hyderabad. Air travel in India is growing rapidly as the middle class expands.
November 2017: "Gulf Air Names New (CEO), Leases 787-9s" by (ATW) Alan Dron email@example.com November 17, 2017.
Gulf Air (GUL) has appointed the former head of Croatia Airlines (CRH) Krešimir Kucko, as (CEO), effective immediately. He replaced Maher Salman Al Musallam, who retired earlier this year.
(GUL)’s Chairman Zayed Bin Rashid Alzayani, said Kucko “brings with him exceptional industry knowledge that I am confident will add considerable value to our business.” (GUL) has been loss-making for several years; it has been clawing its way back toward breakeven, although no financial figures for 2016 have been released. The last available figures, for 2015, recorded a net loss of -$63.6 million, a considerable improvement on a few years earlier, when losses of several hundred million dollars were recorded.
Kucko served as Croatia Airlines (CRH)’s President & (CEO) from 2012 and had been with the central European carrier for 25 years. While in the top position, he was responsible for restructuring (CRH), which has recorded a profit for the past 4 years.
He joined (GUL)’s recently appointed Deputy (CEO) Captain Waleed Abdul Hameed Al Alawi as (GUL) prepared to receive a new fleet of 39 new Boeing and Airbus airplanes, with deliveries scheduled from early 2018.
As part of that fleet renewal, (GUL) has signed a lease agreement with lessor Dubai Aerospace Enterprise (DAE) for 5 787-9s. “The incoming airplanes represent an important step in our strategic direction towards furthering (GUL)’s fleet modernization process, enhancing passenger comfort and broadening our network as we look to strengthen our presence across the globe,” Al Alawi said.
June 2018: Aircraft lessor Dubai Aerospace Enterprise (DAZ) Capital has signed agreements to sell 16 aircraft, valued at approximately $900 million. “This divestment activity will help us optimize our portfolio composition and monetize some of our recent larger-scale investments. This transaction does not impact our total number of customers. Proceeds will be used to pay down debt and reinvested to support our ambitious growth plans.
August 2018: (DAE) Hits Record Interim Profit After (AWAS) Acquisition" by Victoria Moores (firstname.lastname@example.org), August 10, 2018.
Dubai Aerospace Enterprise (DAE) has posted a +$224 million pre-tax profit for the 2018 1st half, up from +$42.5 million for the comparable period, driven by the “smooth and successful integration” of leasing company (AWAS).
“These results would simply not have been achievable without a smooth transition to a combined platform. Today, (DAE) is an exceptionally strong company created by marrying stable and strong ownership with the platform capabilities we acquired last year. Our expectation is for continued improvement in our financial metrics and liquidity profile that will eventually lead to higher credit ratings,” (DAE) (CEO) Firoz Tarapore said.
Since (DAE) closed the (AWAS) merger in August 2017, the combined platform has completed 108 aircraft transactions and built up a portfolio of 375 owned, managed and committed aircraft, valued at $15.5 billion.
During the 1st half, (DAE) generated $711.4 million in revenue, up from $228.7 million for the comparable period in 2017. (DAE) purchased 15 aircraft, disposed of 8 and closed $774.5 million in borrowings.
(DAE) has also announced the sale of 16 aircraft, valued at $900 million, seizing on “a period of strong investor demand for aircraft assets.”
October 2018: Dubai Aerospace Enterprise’s (DAZ) leasing arm, (DAE) Capital, completed 8 leasing transactions in (3Q) 2018 and closed an $800 million revolving loan facility during the quarter, the parent company said in a review of the period on October 11.
The (UAE)-based lessor is expanding rapidly, having acquired Ireland-based (AWAS) in 2017, and now has an owned, managed and committed fleet approaching 400 Airbus, ATR and Boeing airplans with a fleet value of $14 billion.
(DAZ) has told local media in the (UAE) that it plans roughly to double its fleet over the coming decade. In its quarterly review, (DAE) noted that 2 global ratings agencies had marked up its prospects; (S&P) Global Ratings upgraded (DAE)’s corporate credit rating to BB+ while Moody’s Investors Service revised the organization’s rating outlook to “positive.”
The period under review also saw the (DAZ) board approving a $300 million bond repurchase program and closing the $800 million revolving loan facility that it had launched in May.
On the operational side, (DAZ) took delivery of its 1st 2 Boeing 737 MAX 8 airplanes. Over the quarter, it purchased 3 new aircraft and sold 13. The average age of its owned fleet is 6.3 years, while the average lease term remaining on its owned fleet is 6.2 years. It now has 109 customers in 56 countries.