You are a senior airline captain finally making good money and decide to buy a new...

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You are a senior airline captain finally making good money anddecide to buy a new airplane for your personal flying. An FBO thatis an aircraft dealer seeking to sell you an airplane offers tolease it back from you for use in their charter, rental, and flighttraining operations. A different flight school operation that isnot in the business of selling aircraft advises you that they'd beinterested in leasing the aircraft from you. Having some incomefrom the airplane would be financially helpful, and both companiesare financially sound and have good reputations for paying theirbills on time and taking good care of aircraft entrusted tothem.
You have two options:
Buy the airplane from the dealer and lease it back to them,or
Buy the airplane from the dealer and lease it forward to theflight school.
Carefully analyze which of these options is the most likely toresult in the lowest purchase price and the most reliable leaseincome. Explaining your reasoning clearly.

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4.1 Ratings (832 Votes)

I would be taking alternative number 2 based on my decision Purchasing the aircraft from the manufacturer and selling it to the flight school That is since typically a lease forward contributes to a stronger partnership between the lessor and the lessee The lessors primary motive in the ordinary aircraft lease a lease forward is to earn income from the aircraft and the primary motive for the lessee is to obtain the use of an aircraft without having to make the capital investment necessary to purchase one When the interests of the participants in a lease deal have been harmonized neither the lessor nor the lessee typically has the motive to turn See Answer

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