Portuguese wet lease airline Hi Fly is well known around the world for its badass all-white A340s, its shiny new A330neo and, of course, its eye catching A380. But being based in Portugal does come with some drawbacks, particularly when it comes to doing business in the USA. We caught up with CEO of Hi Fly, Dr. Paulo Mirpuri, to discuss the future plans of the airline.
USA or bust!
In our recent interview with the CEO of Hi Fly, Dr. Paulo Mirpuri, we covered a lot of ground. From the demand for the A380 to Hi Fly’s future fleet plans, it was a great opportunity to hat with the boss about his strategies and priorities. Inevitably, the conversation turned to the future, and where he sees Hi Fly going next. Dr. Mirpuri didn’t hesitate to tell us,
“Hi Fly want to expand to the US.”
Clearly that’s a great goal to have, but what does it actually mean? Dr. Mirpuri elaborated, telling us,
“In Hi Fly itself, our next move is to expand into the U.S. The U.S is a huge market for us and on certain days we have five or six daily flights to the U.S for different customers. So, the U.S market itself, domestically, it is important for Hi Fly.
“We believe we need to expand into the U.S and to work on a partnership with a U.S company for sure, because of the various regulations.”
Currently, the US is heavily restricted to European airlines looking to do business. For Hi Fly, there are some serious caveats on wet leasing to US airlines, something which the Portuguese company will need to work hard to navigate. As such, Dr. Mirpuri confirmed that Hi Fly would look to open a base in the US, although he did not specify where. In terms of when this could happen, he told us,
“We hope to see in the next two years Hi Fly U.S flying.”
Dr. Mirpuri also discussed the potential for moving into other markets, perhaps in Asia or Australia. He noted that while he is keen to also work in these markets, he doesn’t require a local operators’ certificate to do so, therefore would not require a base in the region in order to operate there.
Why does Hi Fly need a base in the US?
The global wet lease market is currently estimated to be world around $7.35bn. However, it is anticipated to grow to $10.9bn by 2029. While Hi Fly freely wet leases aircraft to airlines all over the world, it is faced with some restrictions in terms of what it can do in the United States.
In February last year, the US DoT announced plans to make it harder for European airlines to wet lease to other EU carriers flying to the US. This was a reaction to restrictions in place in the EU since 2008, which time-limited the leasing period for non-EU airlines to wet lease to EU carriers. The DoT rules effectively mirrored those of the EU.
As a result, in August last year, the EU agreed to drop restrictions on leasing of US crewed planes. The DoT applauded this and were reported by Reuters to comment,
“U.S. carriers will now be able to compete fairly in the marketplace, more broadly offering their services in worldwide markets, and gaining a valuable chance to benefit from the new commercial opportunities.”
However, despite this, there has been no relaxing of the regulations in terms of leasing to US carriers themselves. Although Hi Fly is able to fly to the US under existing certification on behalf of any EU airline, it is not allowed to directly wet lease aircraft to US registered airlines. As such, in order to break into the US market adequately, it will need to set up a base there.
What do you think about Hi Fly’s USA dream? Let us know in the comments!