Summary
- Russia quickly seized foreign-leased aircraft to prevent the major impact of sanctions on its aviation industry.
- Over 170 foreign-owned aircraft have been re-registered by Russian airlines in response to sanctions.
- Despite challenges with maintenance and foreign parts, Russia is working to replace domestic aircraft that have been delayed by the sanctions.
In February 2022, Russia launched its full-scale invasion of Ukraine. In horror, the West reacted by not only supporting Ukraine but also by sanctioning the country. The sanctions had immediate and consequential impacts on Russian aviation. Most commercial aircraft are leased and not owned by the airline operating them – this meant the bulk of the commercial airliners in Russia were Western-owned.
Russia seized around 400 foreign-leased aircraft before the country could be essentially bereft of commercial airliners. Over the last two years, that saga has continued to unfold as Russia has purchased many of these seized aircraft. Recent reporting suggests many more aircraft will be bought and re-registered in Russia (a minority of aircraft are also being repossessed).
The 2022 sanctions
The sanctions imposed on Russia required leasing companies to repossess all the planes they had leased to Russian airlines. Had this happened, it would have been devastating for Russia. Russia moved quickly and seized hundreds of commercial airliners owned by US and European leasing companies to keep them in the country. According to CNN’s reporting, 85% of foreign-made planes in Russia were owned by leasing companies (valued at $12.4 billion). Russian airlines at the time of the sanctions operated 305 Airbus jets, 332 Boeing jets, and 83 regional jets built by Bombardier, Embraer, and others. Only 144 of the planes active in Russia at the time were built by Russia.
Photo: Tupungato | Shutterstock.com
In July 2022, The Washington Post reported an incident in Sri Lanka where the country almost seized an Irish-owned airliner operated by Aeroflot. An employee of Sri Lanka’s court system entered the airport with a judicial order grounding an Aeroflot flight set to take off for Moscow. The aircraft’s almost 200 passengers were deplaned and sent to local hotels. A diplomatic row ensued and Aeroflot halted all flights to the island.
According to the Washington Post, Russia threatened to cut off energy deliveries to Sri Lanka (the country was already in a severe economic crisis). After a request from the government, Sri Lankan courts issued a new ruling allowing the aircraft to fly back to Russia. Aeroflot may have been able to retrieve its jet this time, but this is not a threat environment airlines are fond of operating in.
Related
Sanctions: What Happened To Russian Aviation During 2022?
Let’s take a look at how the year started and how it has unfolded since the fateful events of February 24.
The purchase of seized Western jets
Over the last two years, the saga has continued to unfold. Cut off from Western parts and being extremely restricted to where planes can fly internationally, Russia has continued to operate the seized aircraft. It’s also questionable how much the leasing companies even want the aircraft back (they don’t have acceptable valid airworthiness certificates and have no access to Western parts). This was not a status quo that suited anyone.
Photo: Vladimir Zhupanenko | Shutterstock
Consequently, Russia has been purchasing the seized aircraft. In December 2023, Reuters reported Russia had bought out another 92 aircraft from foreign leasing companies using 190 billion rubles ($2.06 billion) from Russia’s National Welfare Fund. At the time, Aeroflot said they had purchased 28 of their aircraft, while 19 had been purchased for Ural Airlines and 45 for S7 Airlines. Another Russian company, Charter iFly, requested these early funds but received none.
Bought-out seized aircraft:
- Aeroflot: 93 aircraft
- S7 Airlines: 45 aircraft
- Ural Airlines: 19 aircraft
- Aurora Airlines: 8+ aircraft
- Charter iFly: 0 aircraft
In late January 2024, Reuters again reported that aircraft leasing firms had secured settlements for around a quarter of the approximately 400 seized aircraft (totaling over $2.5 billion). Reuters also stated that the National Welfare Fund had been allocated 296.8 billion rubles ($3.31 billion) by then to buy out the aircraft.
Related
How Russia’s Private Jet Owners Are Getting Around Sanctions To Fly To Europe
Only one plane a week chartered by a wealthy Russian enters the EU.
More purchases are set to follow
The Russian newspaper Kommersant (one of Russia’s main business dailies) reported that the Ministry of Transport in Russia requested another 295 billion to buy out more leased aircraft. The Kommersant noted that some 162 aircraft had already been purchased by mid-March 2024. This amounts to over a third of the foreign-owned fleet in Russia, as a request. In total, adding individual transactions where companies have used their own funds, Russian airlines have re-registered over 170 aircraft of the 400-ish foreign-leased aircraft. In return, the foreign lessors have dropped any claims to the aircraft, and Russia can feel safer flying the aircraft out of the country and not having them counter-seized after touching down.
Photo: Media Works | Shutterstock
Russia would like to legalize the entire fleet if it can – but this process takes time to work out. The newspaper stated that most funds were requested for the national carrier Aeroflot to acquire around 90 aircraft. Aeroflot Group alone has re-registered 93 aircraft since the beginning of the debacle in February 2022. The airline operates a fleet of 349 aircraft.
The last couple of years haven’t been easy for Russian aviation. The sanctions have made it difficult to maintain foreign aircraft (due to a lack of parts) and fly them abroad (due to the lack of airworthy certificates and the risk of being counter-seized). The sanctions have also crippled Russia’s own domestic aviation industry. Since the beginning of the war, Russia’s once-touted Sukhoi 100 Superjet has been in limbo, and none have been produced. The Kommersant reported in March 2024 that many domestically built Russian aircraft (MS-21, SJ-100, Tu-214, Il-114, and Baikal) are being delayed. The delays in domestic Russian replacements have made buying out the foreign aircraft all the more important Kommersant noted.
Photo: Fasttailwind | Shutterstock
A tale of repossessions
Not all foreign aircraft are being re-registered in Russia – a few are being repossessed. It has recently been reported that the Singapore-based aircraft lessor, BOC Aviation, has repossessed three Boeing 747 freighter aircraft. These had been on lease to AirBridgeCargo in Russia. While the first of the three was able to be repossessed immediately (it was in Hong Kong for maintenance), the last of the freighters – a Boeing 747-8F (registration VQ-BFU) has just arrived at Shanghai’s Pudong International Airport, ending its 2-year internment in Russia.
