Iranian Airlines and Sanctions; When Leased Aircraft Become 'Parts Warehouses'

International sanctions over the past decades have created numerous challenges for Iran's aviation industry; challenges that have disrupted the financial balance of Iranian airlines and jeopardized the safety of air travelers. While in other countries aircraft older than twenty years are retired, the average age of Iran's fleet has reached 28 years, forcing airlines to use parts from other aircraft to refurbish their fleets. Recently, a former Iranian representative at ICAO stated that airlines are using second-hand aircraft purchased as 'parts warehouses'. Alireza Manzari added that at least 10 aircraft have entered the country in the past year solely for parts supply and do not enter the flight cycle. He noted that in some cases, 'part theft' from hangars has also been reported. Iranian airlines are grappling with issues such as blocked flight paths to Europe, losses, fuel prices, and fleet aging, while Donald Trump's return to the White House and the potential for increased economic pressures will make continued operations in this industry even harder. Accordingly, aviation industry experts warn that the increasing challenges of aircraft maintenance and unconventional trends for the survival of airlines have become concerning. The website 'Eco Iran' reported on January 7, comparing the status of 'operational aircraft' with 'the annual exit of high-age and worn-out aircraft', warning that if the current situation continues, the few remaining active aircraft in Iran's aviation fleet will be completely grounded in less than ten years. The Iranian Minister of Tourism stated that tourism development is not possible with 130 old aircraft. Aviation managers believe that Iranian airlines need 550 aircraft, while currently, there are only 140 active aircraft in Iran. This number was about 170 two years ago, and it is now reported that more than half of Iran's aviation fleet is grounded due to parts supply issues. According to some experts, among the 140 active aircraft in Iran, only seven or eight are 'reliable passenger aircraft'. Other reports suggest that about twenty Iranian passenger aircraft are operational, with thirteen of them grounded due to lack of parts, while the remaining fleet is used for domestic and international flights. The number of grounded aircraft at airports has increased so much in recent months that Saeed Chalendari, CEO of Imam Airport, warned airlines on January 1 to collect scrap aircraft from this airport. Apart from 'reliable aircraft', the maintenance of other aircraft in the fleet, which includes older Boeing and Airbus models, is done with difficulty and through intermediaries due to sanctions. Additionally, some types of parts for Iran's old aircraft are no longer produced, leading companies to rent other aircraft to supply parts. A member of parliament stated that some airlines operate 'with only two active aircraft'. Although the main reason for the aging of Iran's aviation fleet is international sanctions, part of the problems stems from 'financial shortages' and airlines' difficulties in covering parts costs. Maqsoud Asadi Samani, Secretary of the Airlines Association, stated last August that the shortage of airline tickets was due to 'issues related to parts supply', adding that 'airlines must wait about 45 days to two months in line for currency allocation, which will further ground the aviation fleet'. The financial problems of airlines are so severe that some are even unable to secure 'adequate capital' for continued operations. In 2016, while the minimum asset value for airlines to continue operations was reported to be up to 350 billion tomans, only three companies, 'Iran Air', 'Mahan', and 'Aseman', reached the capital adequacy threshold. Hussein Zahi, a former Iranian representative at ICAO, stated that some airlines have rented aircraft and during the time they use the rented aircraft, they have the opportunity to install quality parts from this aircraft onto their own fleet. He noted that this action does not mean 'part theft' but leads to 'debt' for the airlines. He did not explain how Iranian airlines would settle this debt. Iran's air transport fleet has resorted to replacing parts of rented aircraft while Iran, following the 2015 nuclear agreement known as 'JCPOA', ordered a total of two hundred passenger aircraft from Boeing, Airbus, and ATR, but only three Airbus and thirteen ATR aircraft entered Iran, with the delivery of the remaining aircraft halted due to the United States' exit from the JCPOA. According to managers of the Islamic Republic of Iran Air (Iran Air), out of the new aircraft known as 'JCPOA aircraft', only seven or eight are active, while the rest are grounded due to lack of parts. Jafar Yazarlu, spokesperson for the Civil Aviation Organization, also stated last May that Iran Air cannot pay the installment for the JCPOA aircraft, which amounts to 330 billion tomans, and this issue has hindered timely technical inspections of the aircraft and parts replacement. The crisis in Iran's aviation industry intensified in 2017, coinciding with Donald Trump's first term in the White House. At that time, sanctions and financial problems led to the beginning of the cycle of grounded aircraft exiting Iran's aviation fleet. Mehrdad Taghizadeh, then Deputy Minister of Roads and Urban Development, announced in 2018 that airlines were 'shutting down' due to the non-payment of state currency by the Central Bank. Subsequently, the government attempted to sign an agreement with two airlines, Aseman and Iran Air Tour, to purchase forty Sukhoi passenger aircraft from Russia, but it was later announced that the purchase of Russian Sukhoi aircraft was also not possible because it required an OFAC license from the U.S. Treasury. Now, with Trump's return to the White House, the status of Iran's aviation fleet has worsened significantly since 2017, creating a concerning outlook for flight safety in Iran and the continued survival of the aviation industry. Perhaps the only glimmer of hope in this regard is the resumption of negotiations between Iran and the U.S. to resolve their disputes and reach a comprehensive agreement that would result in the lifting of sanctions, allowing the country to simultaneously revitalize its aging aviation fleet with economic opening.