Boeing, the world's largest airplane manufacturer, said it was stopping parts, maintenance, and technical support for Russian airlines as the impact of sanctions imposed in the aftermath of Russia's invasion of Ukraine echoes around the world.
The news came Tuesday, as aircraft and engine makers, lessors, and maintenance, repair, and overhaul (MRO) providers with Russian customers face a slew of EU and US restrictions, including restrictions on leasing planes, exporting new planes, and providing components.
There may also be payment delays as a result of the suspension of several Russian banks from the SWIFT international payments system.
The new sanctions isolate Russia's aviation sector in the same manner they isolate Iran and North Korea, but they will have far more serious implications due to the Russian market's larger size and previous strong reliance on Western supplies.
According to aviation consulting firm IBA, Russia accounted for roughly 6% of global air traffic capacity in 2021, up from around 4% in 2019 due to the strong relative performance of its domestic market during the pandemic.
Domestic capacity was higher than pre-pandemic levels last year, and Russian airlines were considered as more dependable performers on jet lease agreements at a time when several Southeast Asian airlines were delaying payments or returning jets owing to financial difficulties.
According to Cirium, around 515 Russian jets with a market worth of almost $10 billion are rented from foreign companies.
Lessors have until March 28 to terminate contracts imposed by the EU, but industry executives have raised concern about Russian airlines' compliance with orders to return the airplanes.
The embargo on spare parts delivery, according to Peter Walter, director of technical and asset management at IBA, is expected to have a significant impact on the Russian sector, as it has in the past in Iran.
"Because components are limited, we anticipate to see aircraft on the ground in Russia being looted in order to maintain the rest of the fleet running," Walter stated on a Tuesday webinar.
Although Russia has local MRO facilities, carriers have also entered into agreements with foreign companies. Aeroflot inked a long-term component repair and overhaul deal with Hong Kong Aircraft Engineering Company (HAECO) last year.
On Wednesday, HAECO did not immediately respond to a request for comment on whether the sanctions would damage the deal.
Meanwhile, Russian soldiers have intensified their bombardment of Ukraine's main towns, officials claimed, dropping missiles on residential areas and killing at least 21 people in the eastern city of Kharkiv and four in the western city of Zhytomyr, reports said Wednesday.
