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Fly Lately? This Guy Probably Owns The Plane.

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I read an interesting article today from The New York Times (via Freakonomics blog) about Steven Udvar-Hazy, a Hungarian immigrant and UCLA grad who is the largest force in the airline industry. Many people, including myself, may be surprised to learn that most commercial airplanes are not owned by the carriers, but instead are leased.

As founder and chief executive of the Los Angeles-based International Lease Finance Corporation, Mr. Hazy has a fleet of 824 Boeings and Airbuses, with 254 more on order, that dwarfs any airline’s in the world. He owns more planes than the industry leader, American Airlines, which has 679, and more than the combined holdings of Air France (265), Lufthansa (245) and British Airways (239).

Who does own these massive vehicles, each priced in the tens of millions? Udvar-Hazy does, or more specifically his company International Lease Finance Company. This guy lives and breathes airplanes and has been doing it since his twenties, starting off with a used DC-8 and two partners.

He raised cash from a small group of fellow Hungarian émigrés and started making deals while an economics student at U.C.L.A. As a junior in 1966, he advised Aer Lingus on how to save money by reducing the aircraft types in its fleet, and, as a senior, he brokered the sale of a turboprop from Air New Zealand to Reeve Aleutian Airlines.

He is now a billionaire three times over and brokers so many deals that he is often called by Boeing, Airbus, and other leading manufacturers to consult. He owns nearly half the planes in service so it’s very likely that the plane you were on recently was his. Not surprisingly, most of his business comes from international companies, rather than domestic airlines.

“Big U.S. carriers, since the dawn of the jet age, act almost like superior beings,” said Mr. Hazy, who said that half his customers sought to re-negotiate leases after 9/11. “They want all the benefits when times are good, but if they are bad, they want you to sacrifice.”

Still, with I.L.F.C. making money at a time when American carriers are having financial problems, Mr. Hazy feels that he may have the last laugh: “Our company is stronger than any major U.S. carrier. The day will come when they need I.L.F.C.”

| Read more at The New York Times |

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