Commercial Aviation
AIP Capital and Monroe Capital Launch $1B Aircraft Leasing Venture
$1 billion joint venture targets mid-life aircraft leasing amid supply chain disruptions, backed by Deutsche Bank and Fifth Third Bank.
The aviation finance world has just witnessed a significant development with the announcement of a joint venture between AIP Capital and Monroe Capital. This strategic partnership aims to acquire a diversified portfolio of mid-life aircraft on long-term leases to global Airlines, with an initial investment target of $1 billion. Backed by a $500 million senior secured warehouse facility from Deutsche Bank and Fifth Third Bank, the venture is poised to capitalize on the growing demand for mid-life aircraft amid global supply chain disruptions and rising air travel demand.
This collaboration merges AIP Capital’s deep expertise in aviation asset management with Monroe Capital’s strength in private credit and asset-based finance. As the aircraft leasing market continues to expand, projected to reach $401.67 billion by 2032, this venture represents a timely and calculated move to address airline needs for flexible, cost-efficient fleet solutions. The deal reflects broader trends in private credit’s increasing role in aviation finance and the revaluation of mid-life aircraft as valuable, income-generating assets.
Monroe Capital, a $20.7 billion asset manager with a strong track record in private credit, brings institutional capital and structuring capabilities to the table. Its Alternative Credit Solutions (ACS) group has been active across sectors, including infrastructure and industrials, and now sees aviation as a “natural extension” of its platform. By partnering with AIP Capital, Monroe expands into a sector with long-term demand visibility and tangible collateral.
AIP Capital, founded in 2023, has quickly built a reputation for aviation finance innovation. With $4 billion in assets under management and operations spanning Dublin, New York, Stamford, and Singapore, the firm operates across three verticals: aviation asset management, direct aircraft investing, and private credit. Its wholly owned lessor, Phoenix Aviation Capital, has already acquired 30 Boeing 737-8 aircraft for long-term leases to airlines like LOT Polish Airlines and Flair Airlines.
The partnership structure designates AIP as the servicer of the aircraft assets, handling lease administration, technical oversight, and trading. Monroe, meanwhile, provides capital through its institutional investor network. This division of labor allows each firm to play to its strengths while jointly navigating the complexities of aircraft acquisition and leasing.
“This venture provides scalable and stable capital; critically, it enhances value to our global airline customers and lessor trading partners even as capital markets have increased volatility.”, Jared Ailstock, Managing Partner at AIP Capital
The timing of this venture is particularly strategic. Aircraft manufacturers like Airbus and Boeing are facing production delays due to supply chain issues, resulting in a shortage of new aircraft. This has elevated the value and demand for mid-life aircraft, typically those aged 12 years or older, that are now being rebranded as “mature, proven assets.”
Lease rates for mid-life aircraft such as the Airbus A320ceo have risen by more than 20% annually, with some models nearing parity with newer aircraft like the Boeing 737-800. Airlines are extending leases on these aircraft to maintain capacity, especially as new deliveries are delayed until at least 2030. The AIP-Monroe venture targets this segment to benefit from elevated lease rates and strong residual values.
Moreover, mid-life aircraft offer financial advantages. Having already undergone significant depreciation, these assets present lower capital costs while maintaining operational efficiency. Their maintenance schedules are also well understood, making them attractive to lessors and investors seeking predictable returns. The venture’s initial $500 million warehouse facility, secured from Deutsche Bank and Fifth Third Bank, allows for scalable capital deployment without immediate equity dilution. This facility supports the acquisition of aviation assets under long-term leases, focusing on portfolio diversification and lease stability.
Legal and tax advisors ensured the structure’s compliance and tax efficiency. Gibson Dunn served as transaction counsel and PwC acted as tax advisor to AIP Capital, while Milbank LLP and KPMG advised Monroe. This meticulous structuring reflects the venture’s ambition to scale while maintaining robust operational and legal governance.
By targeting multiple aircraft types and lessees, the venture aims to mitigate concentration risk and optimize residual values. AIP’s technical expertise will be instrumental in managing asset performance and maximizing lease income through potential secondary market trading, a segment that grew by 35% in 2024.
The global aircraft leasing market is experiencing a period of rapid expansion. Valued at $172.88 billion in 2023, it is projected to grow to $401.67 billion by 2032, driven by increasing air travel and airlines’ preference for leasing over ownership. Leasing allows airlines to optimize capital allocation and maintain fleet flexibility.
Europe remains the largest market, holding over 50% share in 2023, thanks to Ireland’s favorable tax and regulatory environment. However, Asia-Pacific is the fastest-growing region, fueled by the rise of low-cost carriers and expanding route networks. Narrowbody aircraft, especially the Boeing 737 MAX and Airbus A320neo families, are in highest demand, with lease rates for new models exceeding $400,000 per month.
Due to production delays, an estimated 3,000-aircraft deficit has emerged, extending the economic life of current-generation models. This has created a window of opportunity for lessors focusing on mid-life assets, which are increasingly seen as essential to maintaining airline capacity in the near term.
Mid-life aircraft are being re-evaluated in the context of ongoing supply chain disruptions and evolving airline strategies. The term “mature, proven assets” reflects their reliability, cost-effectiveness, and operational readiness. These aircraft are now central to airline fleet strategies, particularly for low-cost carriers operating in volatile demand environments.
Three main factors are driving the value appreciation of mid-life assets: IBA forecasts suggest that lease rates for mid-life aircraft will remain elevated through at least 2025, with models like the Airbus A330 and Boeing 777-300ER surpassing pre-pandemic values. This sets the stage for sustained profitability in the mid-life leasing segment.
AIP and Monroe enter a competitive but expanding field that includes established lessors like AerCap and SMBC Aviation Capital. However, their unique combination of private credit and integrated servicing offers a differentiated model. Monroe’s non-bank financing capabilities and AIP’s asset management expertise create operational agility and capital efficiency.
The venture’s initial $500 million facility provides room for rapid scaling, with additional capital infusions possible as the portfolio matures. Success will be measured by portfolio diversification, residual value retention, and secondary market activity. Analysts project the venture could capture 2–3% of the global mid-life segment by 2027, generating up to $180 million in annual lease income.
Looking ahead, the venture may expand into adjacent asset classes such as engine leasing, where similar supply-demand imbalances exist. This would further diversify revenue streams and enhance portfolio resilience.
The joint venture between AIP Capital and Monroe Capital marks a strategic evolution in aviation finance. By targeting mid-life aircraft, assets that are increasingly vital in a constrained supply environment, the partnership offers airlines access to reliable capacity and investors exposure to resilient, income-generating assets. With a scalable capital base and deep operational expertise, the venture is well-positioned to navigate market volatility and capitalize on long-term trends.
As the global aircraft leasing market continues to grow and mature, this collaboration could serve as a model for future private credit-led investments in aviation. Stakeholders should monitor the venture’s asset acquisition strategy, lease performance metrics, and potential expansion into related sectors to gauge its broader impact on the industry.
What is the goal of the AIP-Monroe joint venture? Why focus on mid-life aircraft? Who is financing the venture? What role does AIP Capital play? What are the risks involved? Sources: AIP Capital, Fortune Business Insights, IBA
AIP Capital and Monroe Capital Launch $1 Billion Aircraft Leasing Venture
The Strategic Rationale Behind the AIP-Monroe Venture
Combining Capital and Aviation Expertise
Market Timing and Asset Strategy
Financing Structure and Legal Framework
Aircraft Leasing Market Trends and Implications
Global Market Growth and Regional Dynamics
Mid-Life Aircraft as Strategic Assets
Competitive Landscape and Future Expansion
Conclusion
FAQ
The venture aims to acquire a diversified portfolio of up to $1 billion in mid-life aircraft on long-term leases to global airlines.
Mid-life aircraft offer operational reliability, lower capital costs, and strong lease rate performance due to supply chain-induced shortages of new aircraft.
Monroe Capital is providing the investment capital, supported by a $500 million warehouse facility from Deutsche Bank and Fifth Third Bank.
AIP Capital will act as the servicer of the assets, managing lease administration, technical operations, and asset trading.
Key risks include interest rate volatility, lessee credit defaults, and market shifts in aircraft values. However, the asset-backed nature of the venture provides mitigation.
Photo Credit: AIP Capital
Route Development
United Airlines CEO Defends Gate Control at Chicago O’Hare in 2026
United Airlines commits to defending gate allocation at Chicago O’Hare amid competition with American Airlines using flight volume strategies in 2026.
This article summarizes reporting by Reuters and Rajesh Singh.
The ongoing struggle for control over Chicago O’Hare International Airport (ORD) intensified sharply on Wednesday, January 21, 2026. During United Airlines’ fourth-quarter earnings call, CEO Scott Kirby issued a stark warning to rival American Airlines, signaling that United is prepared to aggressively defend its market share and gate allocation at one of the world’s busiest aviation hubs.
According to reporting by Reuters, Kirby explicitly stated that United is “drawing a line in the sand” regarding gate competition in 2026. The conflict centers on the airport’s “use-it-or-lose-it” leasing agreement, which reallocates gates based on flight departure volumes. With American Airlines attempting to regain ground lost in 2025, United has pledged to match any capacity increases necessary to prevent its rival from acquiring additional infrastructure.
The core of this dispute is not just about rhetoric; it is a structural battle over real estate governed by the 2018 Airline Use and Lease Agreement (AULA). As reported by Reuters, Kirby emphasized that United would add “as many flights as are required” to maintain its current gate count.
During the earnings call, United leadership highlighted a significant financial divergence between the two carriers at their shared hub. Kirby claimed that while United’s O’Hare operations generated approximately $500 million in profit in 2025, American Airlines suffered a loss of roughly the same amount at the hub. United argues that this disparity makes American’s aggressive expansion unsustainable.
The tension follows a decisive shift in airport real estate that occurred in late 2025. Due to United’s faster post-pandemic recovery and higher schedule density, the carrier triggered a lease clause allowing it to acquire five additional gates in October 2025. Conversely, American Airlines was forced to surrender four gates due to lower utilization metrics.
Current airport data indicates the following gate distribution:
“We’re not going to allow them to win a single gate at our expense.”
, Scott Kirby, United Airlines CEO (via Reuters)
Despite the financial figures presented by United, American Airlines has launched a “scorched earth” scheduling strategy to reclaim its footing. Industry reports indicate that American has added approximately 100 daily departures to its Spring 2026 schedule. The goal of this volume increase is to improve utilization metrics enough to trigger a “claw back” of gates in the next annual allocation cycle.
In addition to schedule padding, American Airlines executed a strategic real estate acquisition in late 2025. Following Spirit Airlines’ bankruptcy proceedings, American purchased two gates for $30 million, securing access outside of the city’s standard allocation formula.
The competition has spilled over into regional route networks, creating a “tit-for-tat” scenario. When American announced new service to regional markets such as Erie, Pennsylvania, and the Tri-Cities in Tennessee in early January, United responded within 24 hours by announcing identical routes. This strategy effectively floods smaller markets with capacity, preventing either carrier from establishing a monopoly.
While passengers may benefit temporarily from the lower fares resulting from this capacity dumping, the long-term implications for O’Hare are complex. The aggressive “use-it-or-lose-it” rules were designed to ensure efficient use of public infrastructure, but they currently appear to be incentivizing airlines to fly potentially unprofitable schedules solely to hoard real estate.
Furthermore, this squabble is the prelude to the massive “O’Hare 21” expansion. The carrier that commands the most market share today will likely wield the most influence over the design and allocation of the upcoming Satellite 1 and Global Terminal projects. United’s “line in the sand” suggests they view 2026 not just as a battle for current gates, but as the deciding year for the airport’s future configuration.
Sources: Reuters
United Airlines CEO Draws “Line in the Sand” in Battle for O’Hare Dominance
The “Line in the Sand”: Financials and Gate Control
The 2025 Reallocation
American Airlines’ Counter-Offensive
The Route War
AirPro News Analysis
Frequently Asked Questions
Photo Credit: Hyoung Chang – The Denver Post
Commercial Aviation
Air India Launches New Boeing 787-9 on Mumbai-Frankfurt Route in 2026
Air India upgrades Mumbai-Frankfurt flights with a new Boeing 787-9 featuring private Business Class suites and Premium Economy from February 2026.
This article is based on an official press release from Air India.
Air India has announced a major enhancement to its long-haul operations, confirming the deployment of its newest Boeing 787-9 Dreamliner on the Mumbai (BOM) to Frankfurt (FRA) route. Effective February 1, 2026, the airline will replace the currently deployed Boeing 777-200LR aircraft with a factory-fresh 787-9, marking a significant step in its “Vihaan.AI” transformation program.
According to the airline’s official statement, this upgrade introduces a modernized three-class cabin configuration, including private suites in Business Class and a dedicated Premium Economy cabin. The move is designed to address customer demand for updated interiors and consistent service standards on key European routes.
The new aircraft will operate five times weekly, excluding Tuesdays and Fridays. Data from the airline’s schedule indicates the following operational timings:
This schedule is optimized to facilitate connections through Frankfurt. Through its partnership with Lufthansa, Air India passengers can access over 29 destinations across Europe and the Americas, leveraging Frankfurt’s status as a major Star Alliance hub.
Unlike previous Boeing 787-9 aircraft in the Air India fleet, many of which were leased or transferred from Vistara, this specific airframe (registration VT-AWA) features the airline’s bespoke, “line-fit” interior specifications delivered directly from Boeing.
The aircraft accommodates a total of 296 passengers across three distinct classes:
The Business Class cabin comprises 30 suites in a 1-2-1 configuration. These seats, identified in industry reports as the Adient Ascent model, feature privacy doors, direct aisle access for every passenger, and fully lie-flat beds. This represents a substantial upgrade over the older 2-3-2 layouts found on legacy Dreamliners.
Recognizing the growing demand for mid-market luxury, Air India has installed a dedicated Premium Economy cabin with 21 seats arranged in a 2-3-2 layout. Passengers in this cabin will benefit from wider seats, greater recline, and increased legroom compared to the standard Economy offering. The Economy cabin includes 245 seats in a standard 3-3-3 configuration. The airline highlights that these seats are equipped with modern ergonomic features and the latest generation of In-Flight Entertainment (IFE) screens.
This deployment is part of a broader strategy to standardize the passenger experience on routes to Germany. With this change, all Air India flights to Germany, including the Delhi-Frankfurt sector, will be operated by new or significantly upgraded aircraft.
In a press statement regarding the upgrade, the airline emphasized the importance of the European market:
“The deployment of our brand-new B787-9 on the Mumbai-Frankfurt route is a testament to our commitment to offering a world-class experience to our guests.”
The introduction of the “line-fit” Boeing 787-9 on the Mumbai-Frankfurt sector is a critical move for Air India as it seeks to reclaim market share from European carriers. Historically, the airline has faced criticism for aging cabin interiors on its widebody fleet. By deploying a hard product that features private doors in Business Class, Air India is positioning itself to compete directly with Lufthansa, which operates a mix of Boeing 787-9 and 747 aircraft on similar routes.
Furthermore, the inclusion of Premium Economy is strategically vital. As corporate travel policies tighten and leisure travelers seek more comfort without the Business Class price tag, Premium Economy has become the most profitable real estate on modern widebodies. Air India’s ability to offer a consistent three-class product across its German network strengthens its value proposition for both corporate contracts and high-yield leisure travelers.
When does the new aircraft start flying? Does the new aircraft have Wi-Fi? How is this different from other Air India Dreamliners?
Air India Upgrades Mumbai-Frankfurt Route with New Boeing 787-9 Dreamliner
Operational Schedule and Frequency
Cabin Configuration and Passenger Experience
Business Class
Premium Economy
Economy Class
Strategic Significance of the Deployment
AirPro News Analysis
Frequently Asked Questions
The new Boeing 787-9 Dreamliner begins operations on the Mumbai-Frankfurt route on February 1, 2026.
While the press release highlights updated In-Flight Entertainment systems, specific details regarding inflight Wi-Fi availability on this specific airframe have not been explicitly confirmed in the initial announcement.
Most of Air India’s existing 787-8 fleet features an older 2-2-2 Business Class layout without privacy doors. This new 787-9 features a modern 1-2-1 suite configuration and a dedicated Premium Economy cabin, which the older 787-8s lack.Sources
Photo Credit: Air India
Commercial Aviation
Embraer Showcases E195-E2 and E175 Jets at Wings India 2026
Embraer presents E195-E2 and E175 aircraft at Wings India 2026, supporting India’s regional connectivity growth and UDAN scheme.
This article is based on an official press release from Embraer.
Embraer has announced it will feature its commercial aircraft portfolio prominently at Wings India 2026, Asia’s largest civil aviation event, scheduled to take place from January 28 to January 31, 2026, at Begumpet Airport in Hyderabad. According to the company’s official statement, the Brazilian aerospace manufacturers will display both the E195-E2 and the E175 aircraft, positioning them as critical solutions for India’s rapidly expanding regional connectivity network.
The showcase comes as the manufacturer forecasts significant demand within the Indian market. Embraer projects that India will require at least 500 aircraft in the 80 to 146-seat capacity range over the next two decades. This forecast aligns with the country’s UDAN (Ude Desh ka Aam Nagrik) regional connectivity scheme, which seeks to make air travel accessible to Tier-2 and Tier-3 cities.
At the event, Embraer will highlight the specific capabilities of its two displayed jets, targeting airlines that require “right-sized” capacity for routes where larger narrowbody aircraft may prove economically inefficient.
The E195-E2 is the largest member of the E-Jet E2 family. Embraer markets this aircraft as the world’s most fuel-efficient and quietest single-aisle jet. Key specifications highlighted by the manufacturer include:
Alongside the E2, Embraer will display the E175, a model that currently holds an 80% market share in the United States regional jet sector. In India, the aircraft is already in service with Star Air, which utilizes the jet to connect smaller regional hubs. The E175 is presented as a proven workhorse capable of seating up to 88 passengers, bridging the gap between turboprops and larger jets.
“The E-Jets family can transform and grow regional connectivity from tier two and tier three cities in India, tapping on ‘blue ocean’ opportunities.”
, Adity Shekhar, Regional Vice President, Sales, Embraer
Embraer’s participation in Wings India 2026 follows a series of strategic moves intended to deepen its footprint in the region. In October 2025, the company inaugurated a wholly-owned subsidiary in New Delhi. This local entity was established to oversee operations across commercial aviation, defense, and urban air mobility, signaling a long-term commitment to the Indian aerospace ecosystem.
Currently, approximately 50 Embraer aircraft are in operation across India. These include commercial units flown by Star Air, as well as aircraft utilized by the Indian Air Force (IAF) and government bodies for VIP transport and surveillance (Netra AEW&C). We observe that Embraer’s strategy at Wings India 2026 is heavily focused on the concept of “right-sizing.” While Airbus and Boeing dominate the trunk routes with 180+ seat aircraft, Embraer is aggressively targeting the “blue ocean” routes, sectors that are too long for turboprops but lack the passenger volume to fill an A320 or 737 profitably.
Furthermore, the timing of this commercial push appears to synergize with Embraer’s defense ambitions. With the company actively pitching the C-390 Millennium for the Indian Air Force’s Medium Transport Aircraft (MTA) program in partnership with Mahindra, the high-profile display of commercial jets likely serves a dual purpose: demonstrating technological prowess to commercial carriers while reinforcing brand reliability to government stakeholders.
Where is Wings India 2026 being held? What are the dates for the event? Which Embraer aircraft will be on display?
Embraer Targets Regional Growth with E195-E2 and E175 Display at Wings India 2026
Showcasing Efficiency and Reliability
The E195-E2
The E175
Strategic Context and Market Expansion
AirPro News Analysis
Frequently Asked Questions
The event will take place at Begumpet Airport in Hyderabad, India.
Wings India 2026 runs from January 28 to January 31, 2026.
Embraer will display the E195-E2 (commercial jet) and the E175 (regional jet).
Sources
Photo Credit: Embraer
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