Business

AerCap-GECAS deal may hurt aircraft market competition

Aircraft leasing giant AerCap’s acquisition of rival GECAS will reduce competition in the aircraft market, the head of global airline industry body IATA warned on Wednesday.

“We understand that the situation of the leasing companies is difficult,” IATA Director General Alexandre de Juniac told Reuters. “But combining the two to have a big player (in) a very dominant situation is not good news for us.”

The world’s two largest aircraft lessors announced plans last week to combine, with Ireland’s AerCap agreeing to pay more than $30 billion for GECAS, the air finance business of General Electric.

Analysts have said the deal could attract scrutiny from antitrust regulators.

AerCap Chief Executive Aengus Kelly last week dismissed any concerns over concentration, telling Reuters there would be “plenty of competition” in leasing because of the market’s overall size.

AerCap declined to comment on the remarks by de Juniac, who is stepping down from IATA at the end of the month.

“It’s never good news to have a supply chain dominated by a single player,” the former Air France-KLM executive said in the interview. “We hope that it will not mean any increase in leases, which are a very big cost for (airlines).”