So we can’t just sit on these airplanes until the last minute but we do have the ability to hold back on placing some of the longer lead time aircraft to capture the best possible lease economics.
Unidentified Analyst: Got it. For the new aircraft but how about the rollover aircraft that are not being extended?
Steve Hazy: Well, right now, about 90% plus of our leases that have their normal contractual lease expirations are being extended by airlines. So we have very little coming off lease. And where they do come off, we have plenty of lead time to find the best possible follow-on transition less.
Unidentified Analyst: Okay, got it. And then just shifting to delays, I guess just weighing the two between engine and aircraft, how much is engine driven? And — I mean, I guess, from your prepared remarks, I would guess it’s more aircraft. But in terms of the resolution to the engine situation, what — how fast is that clearing up?
Steve Hazy: Well, the dilemma we have is that both Boeing and Airbus are increasing production rates on both their single and wide-body aircraft. But at the same time, the existing fleet that’s out there and flying is requiring more spare engines because the longevity of these new technology engines has not been what we all expected. So the engine manufacturers are sort of caught between having to deliver more engines to Boeing and Airbus and yet they have their airline customers screaming at them to give them more spare support. So I would say of the delays as much as maybe 70%, 75% is engine related and the rest are either self-induced problems at the manufacturers not having enough staffing, not having enough resources, not having enough infrastructure suppliers that cannot keep pace with these increased delivery targets.
So it’s kind of a combination of self-inflicted wounds at Airbus and Boeing of ramping up too quickly after they cut back so much during the pandemic. We’ve got engine delivery delays. And we certainly have some aviation suppliers that are not able to keep up with demand and therefore, can’t deliver the goods to Boeing and Airbus. It’s a combination of all of those. And it’s really different aircraft types.
John Plueger: Yes. Let me add as an overall comment that I have to say, from the highest view possible, the bottom line is the airframe OEMs oversold compared to what they can deliver. And they knew full well going into selling all these aircraft, what kinds of reduction rate increases would be required. Yet at the same time, they booked those sales and they put a production rate program in the face of known, well-known supplier challenges. So the bottom line is we don’t accept supply chain as a delivery excuse. We expect to be compensated for our late deliveries and we’re working through our airframe OEMs just to get that and to continue to get that.
Operator: There are no further questions at this time. Mr. Arnold, I turn the call back over to you.
Jason Arnold: Okay. Thank you, everyone, for your time participating in our first quarter call today. We look forward to speaking with you again when we report next quarter’s results. Regina, thank you very much and please disconnect the line.
Operator: This concludes today’s conference call. You may now disconnect.
