An airline needs extra aircraft for the summer season. A charter company wants to launch a new route. A business needs a plane but has no pilots. All three face the same question: should they wet lease or dry lease the aircraft?
Wet leases and dry leases are the two fundamental ways to lease an aircraft, and they allocate responsibility very differently. One hands you a complete flying operation. The other hands you the keys. Choosing the right one depends on what you can operate, what you want to control, and how much risk you are willing to carry.
What a Wet Lease Covers
In a wet lease, the lessor provides the aircraft along with the complete crew, maintenance, and insurance. The industry shorthand is ACMI: aircraft, crew, maintenance, insurance. You get a plane that is ready to fly, staffed by the lessor’s pilots and cabin crew, maintained by the lessor’s engineers, and covered by the lessor’s insurance policies.
The lessee, in turn, handles the commercial side: fuel, airport fees, catering, ground handling, and ticket sales. You decide where the plane flies and when, within the terms of the agreement. The lessor keeps operational control, meaning their crew follows their procedures and their airline operating certificate covers the flights.
Wet leases are popular for seasonal capacity, new route trials, and covering for aircraft in maintenance. An airline facing a summer surge can wet lease two aircraft for four months without hiring a single pilot. Charter operators and tour companies use wet leases to test demand before committing to their own fleet. The flexibility is the point: you scale up and down without long-term crew commitments.
What a Dry Lease Covers
A dry lease is simpler in concept: the lessor provides the aircraft and nothing else. No crew, no maintenance, no insurance. You operate the plane under your own airline operating certificate, with your own pilots, your own maintenance program, and your own insurance coverage.
This is how most long-term aircraft leasing works. Major leasing companies own thousands of aircraft and dry lease them to airlines for terms of five to twelve years. The airline treats the plane as part of its own fleet, paints it in its livery, schedules its own crews, and handles everything the lessor would have provided under a wet lease.
Dry leases require serious operational capability. You need certified pilots, maintenance staff or contracts, insurance, and regulatory approvals. For established airlines, that is business as usual. For a company without aviation infrastructure, a dry lease is not realistic, which is exactly why wet leases exist.
Key Differences Side by Side
The core difference is operational control. Under a wet lease, the lessor operates the aircraft and holds regulatory responsibility for the flights. Under a dry lease, the lessee operates the aircraft and holds that responsibility. Everything else flows from this split.
Cost structure differs sharply. Wet leases cost more per month because you are paying for crew, maintenance, and insurance on top of the aircraft. But the price is predictable: the ACMI rate covers the flying operation, and you add fuel and commercial costs. Dry leases have lower monthly rates, but you carry all the operational costs yourself, which can be substantial and variable.
Duration also differs. Wet leases are typically short term, from a few weeks to a year or two. They are built for flexibility. Dry leases are typically long term, often five years or more, reflecting the investment the lessee makes in integrating the aircraft into its fleet. Breaking a dry lease early is expensive, much like exiting a car lease early but on a far larger scale.
Regulatory treatment is another split. Wet leased aircraft usually operate under the lessor’s operating certificate, which simplifies things for the lessee but requires the lessor to be properly certified. Dry leased aircraft operate under the lessee’s certificate, which means the lessee must meet all regulatory requirements for that aircraft type.
Which Option Fits Your Needs
Choose a wet lease when you need capacity fast and lack the crew or infrastructure to operate the aircraft yourself. Airlines handling seasonal peaks, covering maintenance gaps, or testing new markets are classic wet lease customers. Wet leases also work for ad hoc charter needs, where you need a plane and crew for a specific program or season.
Choose a dry lease when you have the operational capability and want long-term control at a lower monthly cost. Established airlines expanding their fleets almost always dry lease. The economics favor dry leasing once you can staff and maintain the aircraft yourself, because you stop paying the lessor’s margin on crew and maintenance.
There is also a hybrid option called a damp lease, where the lessor provides the aircraft and some of the crew, typically the pilots, while the lessee provides cabin crew. Damp leases sit between the two models and are less common but worth knowing about when negotiating.
Costs, Contracts, and What to Watch
Wet lease pricing is usually quoted as a monthly ACMI rate plus an hourly rate for flight hours above a guaranteed minimum. Watch the minimum guaranteed hours: if you fly less than the minimum, you still pay for it. Fuel price adjustments, positioning flights to get the aircraft to your base, and crew accommodation costs can add up, so model the total cost, not just the headline rate.
Dry lease contracts focus on the aircraft’s condition and return terms. Maintenance reserves, which are monthly payments set aside for future heavy maintenance, are a major cost component. Return conditions are strict: the aircraft must come back with specific maintenance status, component life remaining, and documentation complete. Failing return conditions triggers expensive compensation, a dynamic familiar to anyone who has faced end-of-lease wear and tear charges on a smaller scale.
Insurance deserves attention in both structures. Under a wet lease, confirm exactly what the lessor’s insurance covers and where your liability begins. Under a dry lease, you arrange hull and liability insurance yourself, and the lessor will be named on the policies. Either way, have an aviation insurance specialist review the arrangement before you sign.
Regulatory Basics to Know
Aviation is heavily regulated, and lease structures interact with those rules. In the United States, the FAA has specific rules distinguishing wet leases from dry leases, and mischaracterizing one as the other can create compliance problems. Wet leases between airlines often require regulatory approval or notification, especially for longer terms.
International operations add another layer. Wet leasing an aircraft registered in one country for operations in another involves both aviation authorities. Cabotage rules, which restrict foreign operators from carrying domestic passengers, can limit what a wet leased aircraft may do. If your plans cross borders, get regulatory advice early, not after the contract is signed.
Final Thoughts
Wet lease versus dry lease comes down to one question: do you want an operation or an airplane? A wet lease gives you a complete flying operation with crew, maintenance, and insurance included, ideal for short-term capacity and fast scaling. A dry lease gives you the aircraft alone at a lower monthly cost, ideal for established operators with their own infrastructure.
Define your needs honestly, model the total cost of each option including the extras, and get specialist legal and regulatory advice before signing. Aircraft leases are long documents with expensive consequences, and the right structure at the start saves far more than it costs.
