Economic Sanctions on Russia Put Business Aviation in a Tough Spot

Monday, February 28, 2022 at 05:52 PM ET

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As Canada announced sanctions against Russia on Thursday, Bombardier said it would cancel aircraft deals with Russia, as necessary. [File Photo: Shutterstock]

Key Takeaways:

U.S. and allied sanctions on Russia are significantly impacting the business aviation community, compelling companies to halt dealings with Russian clients and forgo revenue for compliance.
Key players like Bombardier are canceling aircraft sales, and AerCap, the world's largest leasing company, is terminating over 150 aircraft leases with Russian airlines.
Despite the immediate revenue loss, the current high global demand for business jets allows manufacturers to reassign aircraft to other customers, mitigating some financial impact.
The sanctions are expected to force Russian individuals and businesses to sell their private jets due to maintenance and financing restrictions, potentially creating a boom in the aftermarket sales sector.

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The economic sanctions imposed last week on Russia by the U.S. and its allies can put some members of the business aviation community in a tough spot.

In its statement announcing the sanctions, the White House said they include “sweeping financial sanctions and stringent export controls that will have a profound impact on Russia’s economy, financial system, and access to cutting-edge technology.”