Aircraft Leasing
Aircraft Leasing is the agreement between two parties whereby an aircraft is provided by the lessor to the lessee for a fixed period of time in lieu of paying the lessor a fixed monthly rate. This gives lessee, the exclusive rights for utilization of an aircraft. There are two options available for leasing namely short term leasing and long term leasing. Wet-lease is used for short term leasing and Dry-lease is used for long term lease. Other Aircraft leasing options include ACMI and Damp lease. It should be noted here that now-a-days ACMI, Wet lease and Damp lease are considered interchangeable.
Let us discuss leasing types in detail:
ACMI - Aircraft, Crew, Maintenance & Insurance
Here, lessor provides aircraft along with one or more crew members with their salaries but not their daily allowance, maintenance charges for the aircraft and insurance which includes third party liabilities. Lessor sets minimum guaranteed block hour limit per month depending upon the aircraft type and charge for the block hour (choc off to choc on).
Lessee has to pay all fuel, landing, handling, parking, storage fees, crew expenses including meals and transportation as well as visa fees, import duties where applicable, as well as local taxes. Moreover lessee also has to pay the over flight/navigation charges.
Wet Lease
A Wet lease is an Aircraft Leasing agreement between two parties whereby lessor provides an aircraft, complete crew, maintenance and insurance to the lessee, who pays by the hours operated. Lessee cannot use the flight number of the flight provided by lessor instead he uses his own flight number because Wet leases are occasionally used for political reasons. A Wet leased aircraft can be used to operate in the countries where lessee is banned from operating. In UK Wet lease used to mean "including fuel".
Damp Lease
It is similar to ACMI and Wet Lease, the only difference is that term usually meant "without cabin crew". In some countries it is described as wet lease without fuel. Lessee provides the cabin crew. This can only be done if the lessor provides SEP(safety and emergency procedures) training to the cabin crew in order to be familiar with the differences of the aeroplane.
Dry Lease
It is a lease without insurances, crew, maintenance etc. often dry lease is utilized by leasing companies and banks requiring the lessee to provide aircraft registration and to put the aircraft for its own Air Operator Certificate(AOC).