Wet leasing is a contract in which one airline provides another with an aircraft along with the crew, maintenance, and insurance needed to fly it, all billed by the hour. The industry shorthand is ACMI, for Aircraft, Crew, Maintenance, and Insurance. The airline receiving the plane (the lessee) puts its own flight number and tickets on the operation while the airline supplying it (the lessor) keeps its people on the payroll, keeps the aircraft airworthy, and carries the insurance. It’s the fastest way for a carrier to add capacity, and it sits inside a specific set of FAA and DOT rules that decide who is legally responsible for each flight.
What ACMI Actually Covers
Each letter is a cost category the lessor absorbs into the hourly rate.
Aircraft and crew. The lessor supplies a specific aircraft with trained pilots and cabin crew. Those employees stay on the lessor’s payroll, follow the lessor’s procedures, and hold qualifications from the lessor’s training programs. The lessee doesn’t hire, train, or manage any of them. That is the point of the model: a working airplane with people who already know how to fly it, often within days of signing.
Maintenance. The lessor keeps the aircraft airworthy, covering routine line checks and heavier scheduled overhauls. Parts, labor, and the downtime that comes with a heavy maintenance visit all sit with the lessor. If something fails mid-contract, the lessor sources the replacement.
Insurance. The lessor carries hull coverage on the aircraft and liability coverage for injuries or property damage. Federal minimums are $300,000 per person and $20 million per aircraft for carriers operating planes with more than 60 seats, with lower thresholds for smaller aircraft.1eCFR. 14 CFR 205.5 Minimum Coverage Major operators typically carry well above that floor. The lessee doesn’t procure separate coverage on the hull or crew.
Wet Lease vs. Dry Lease
A dry lease delivers only the bare aircraft. The lessee brings its own pilots, its own maintenance program, its own insurance, and takes full operational control, essentially running the plane as if it owned it. A wet lease bundles the flying operation together and leaves operational control with the lessor.
The trade-off is speed versus cost. A wet lease adds a plane to the schedule in days because the lessee doesn’t need to hire, train, or certify anyone new. A dry lease is cheaper per hour over the long run but only works if the lessee already has the infrastructure to operate that aircraft type. The choice usually turns on how long the capacity is needed.
Who Has Operational Control
The central regulatory question in any wet lease is which party has operational control, because that party bears legal responsibility for every flight. Under 14 CFR 121.533, the certificate holder conducting domestic operations is responsible for operational control, and the pilot in command shares responsibility with the dispatcher for preflight planning and flight release.2eCFR. 14 CFR 121.533 Responsibility for Operational Control Domestic Operations In a standard wet lease that party is the lessor.
Before any wet-leased flights can operate, the certificate holder must submit a copy of the lease agreement to the FAA. The agency then decides which party actually holds operational control by looking at who selects and trains the crew, who performs maintenance, who dispatches and schedules the flights, and who services the aircraft.3eCFR. 14 CFR 119.53 Wet Leasing of Aircraft and Other Arrangements for Transportation by Air The FAA then amends the operations specifications of both parties. Contract language alone doesn’t settle the question; the FAA looks at who exercises real-world authority.
One boundary matters here. No U.S. certificate holder may wet lease an aircraft from a foreign person or from any entity not authorized to engage in common carriage.3eCFR. 14 CFR 119.53 Wet Leasing of Aircraft and Other Arrangements for Transportation by Air The FAA has said only entities holding proper FAA certification may maintain operational control of commercial flights, and it investigates arrangements where uncertificated operators appear to be flying under another carrier’s certificate.4Federal Register. Wet Lease Policy Guidance
Penalties
Under 49 U.S.C. ยง 46301, a person can face a civil penalty of up to $75,000 per violation. The FAA Reauthorization Act of 2024 raised the ceiling for administratively imposed penalties to $1.2 million per violation for companies and $100,000 for individuals.5Office of the Law Revision Counsel. 49 USC 46301 Civil Penalties Willful violations or unauthorized commercial operations can also draw criminal prosecution. These penalties reach any party exercising operational control without proper certification, which is the exact situation the FAA’s review process is built to catch.
DOT Filing Timelines
Beyond FAA safety oversight, the Department of Transportation has its own economic authority requirements. Wet leases involving a foreign air carrier need DOT authorization before flights begin,6U.S. Department of Transportation. 14 CFR Part 212 Charter Trips and Special Services and the filing timing depends on how long the lease runs.
- Short-term wet leases of 60 days or fewer: file a notice with the DOT’s Office of International Aviation at least 10 days before the first flight, identifying the parties, the aircraft, and the lease dates.
- Long-term wet leases longer than 60 days: file an application at least 45 days before the first proposed flight, including a copy of the actual lease agreement.7eCFR. 14 CFR 212.10 Application for Statement of Authorization
For long-term leases, the carrier must also serve the application on the FAA’s Director of Flight Standards Service and on each certificated air carrier authorized to serve the general area of the proposed flights.7eCFR. 14 CFR 212.10 Application for Statement of Authorization Late applications can be considered on a showing of good cause, but the DOT has no obligation to accept them. U.S. certificated carriers wet leasing to other U.S. carriers must also obtain a statement of authorization for long-term arrangements.8eCFR. 14 CFR 212.9 Prior Authorization Requirements The DOT’s concern is that the receiving carrier holds the economic authority to fly the routes involved.
What Wet Leasing Costs
Payment runs on block hours, measured from the moment the aircraft first moves under its own power for takeoff until it comes to rest at the destination gate. Contracts almost always include a guaranteed monthly minimum, commonly 200 to 300 block hours, that the lessee pays whether the aircraft flies that much or not. Crew salaries, insurance premiums, and maintenance reserves keep accruing on the ground, and the minimum protects the lessor’s economics.
Hourly rates vary by aircraft size and age:
- Regional jets in the 70- to 100-seat range run in the low thousands per block hour.
- Narrow-body aircraft like the Boeing 737 or Airbus A320 family typically fall in the $4,000 to $6,000 range.
- Wide-body aircraft used on long-haul routes command $8,000 to $10,000 or more per hour.
Newer aircraft and premium cabin configurations push toward the top of each bracket. These figures cover only the ACMI components.
Variable Costs the Lessee Pays
Everything outside the ACMI envelope falls to the lessee. Jet fuel is the largest variable, routinely accounting for roughly a quarter to a third of total flight operating costs depending on market prices. On top of that, the lessee covers:
- Airport landing fees, charged per landing by aircraft weight, with rates at major hubs several times what regional airports charge.
- Ground handling: baggage loading, pushback, de-icing, and ramp services.
- Navigation and overflight charges paid to air traffic control authorities.
- Catering for passengers.
- Crew hotels, ground transportation, and meals during layovers away from base.
The split is deliberate. The lessor locks in a predictable hourly rate covering its fixed costs and margin. The lessee manages the expenses that swing with route, season, and fuel prices.
Who Collects Federal Excise Tax
Wet leases raise a specific question about federal excise taxes on air transportation. The IRS looks at which party has “possession, command, and control” of the aircraft. Under a wet lease that is typically the lessor, because the lessor supplies the crew, performs maintenance, and retains operational authority. The lessor is therefore treated as the entity selling the transportation and must collect and remit the applicable excise taxes.9Internal Revenue Service. Excise Tax Air Transportation Audit Techniques Guide
For 2026, passenger-flight taxes include a 7.5% tax on the amount paid for domestic air transportation plus $5.30 per domestic flight segment. International departures and arrivals carry a flat $23.40 per person, with a reduced rate of $11.70 for segments beginning or ending in Alaska or Hawaii.10Internal Revenue Service. Instructions for Form 720 (Rev. March 2026) Getting the allocation wrong in the lease can trigger back-tax liability and penalties, so the excise-tax question should be settled explicitly in the contract rather than assumed.
When Airlines Use Wet Leases
The most common trigger is an unplanned fleet shortage. When a safety directive grounds a specific aircraft model, carriers with tickets already sold need replacement capacity fast. A wet lease can put a substitute airplane on the route within days while the airline’s own aircraft undergo mandatory inspections or modifications.
Seasonal demand is the second driver. Airlines serving leisure destinations ramp up sharply in summer and holiday periods, and owning enough aircraft to cover peak weeks means flying half-empty planes the rest of the year. A short-term wet lease matches capacity to demand without the year-round overhead.
New route testing is where the model earns its reputation as a strategic tool. Launching an unproven market with a purchased or dry-leased plane commits the airline to years of crew training, maintenance infrastructure, and financing before it knows whether passengers will show up. A wet lease lets the carrier test a route for a few months and walk away cleanly if the numbers don’t work. No aircraft to sell, no crew to reassign.
Manufacturing delays have made wet leasing more common recently. When deliveries slip by months or quarters, airlines that built growth plans around those deliveries face a gap between their published schedules and their available fleet. Wet leasing bridges that gap.