Which arrangement allows one company to lease its airplane to another company in exchange for equal time use, with no charge beyond the difference in ownership or operating costs?

Which arrangement allows one company to lease its airplane to another company in exchange for equal time use, with no charge beyond the difference in ownership or operating costs?

• A. Interchange agreement
• B. Wet lease agreement
• C. Dry lease agreement
• D. Repatriation agreement

Answer: (A)

Interchange agreements are about two operators swapping aircraft or the use of aircraft for equal time periods, with no cash rental involved beyond settling the difference in ownership costs (like depreciation and insurance) and operating costs (such as fuel and maintenance). This setup fits the idea of one company leasing its airplane to another in exchange for equal time use, without paying a separate lease rate—only the cost differential is settled. This differs from a wet lease, which includes the aircraft plus crew, maintenance, and insurance for a fee; a dry lease, which is just an aircraft lease with the lessee supplying its own crew and operations; and a repatriation agreement, which isn’t relevant to aircraft time-sharing.

Interchange agreements are about two operators swapping aircraft or the use of aircraft for equal time periods, with no cash rental involved beyond settling the difference in ownership costs (like depreciation and insurance) and operating costs (such as fuel and maintenance). This setup fits the idea of one company leasing its airplane to another in exchange for equal time use, without paying a separate lease rate—only the cost differential is settled.

This differs from a wet lease, which includes the aircraft plus crew, maintenance, and insurance for a fee; a dry lease, which is just an aircraft lease with the lessee supplying its own crew and operations; and a repatriation agreement, which isn’t relevant to aircraft time-sharing.