How I Built This with Guy Raz – Air Lease Corporation: Steven Udvar-Hazy

Intro

In this episode of “How I Built This with Guy Raz,” Guy interviews Steven Udvar-Hazy, the founder of Air Lease Corporation. Steven Udvar-Hazy is considered the most influential person in aviation and owns more planes than Air France and British Airways combined. His obsession with airplanes started at a young age and was fueled by a desire to escape communist Hungary. In this episode, he shares his incredible journey from escaping Hungary to building a successful aviation leasing company.

Main Takeaways

Steven Udvar-Hazy’s Escape from Hungary

• Udvar-Hazy’s family fled Hungary due to the Russian army taking control.
• Austria was the only non-communist country bordering Hungary, so they hired a guide to take them close to the border.
• The guide became increasingly worried due to minefields, and they had to turn back.
• Eventually, the family got exit visas to Sweden but had to use separate names and act like strangers at the airport.
• The Hungarian authorities were incompetent and more interested in a soccer game, allowing the family to escape.

Steven Udvar-Hazy’s Passion for Aviation

• As a child, Udvar-Hazy escaped Hungary and settled in Manhattan, which was a culture shock for him.
• He had a fascination with planes and would go to LaGuardia airport to watch them take off and land, sometimes even getting into the control tower.
• His passion for aviation filled a void in his life as he was not interested in other American sports.
• He dreamed of being a pilot, even dreaming of flying a DC7 to meet his girlfriend.
• His fascination with aviation continued into his adult life, leading him to become a successful pilot and aviation journalist.

Building a Successful Aviation Leasing Company

• Udvar-Hazy’s business success came from leasing planes to airlines rather than owning them.
• He started his own leasing company, Air Lease Corporation, with the help of two Hungarian co-investors.
• His initial ambition was to have 8-10 planes and make a nice living off of it.
• Buying aircraft in bulk allowed for better leverage in discounts and more weight, leading to a landmark decision to order 130 brand new planes speculatively, including the largest plane in the airline industry.
• AIG made a huge offer of $1.3 billion to buy the company, resulting in a 50 times greater return for investors.

Philanthropy and Legacy

• Udvar-Hazy’s massive donation helped finance the Stephen Udvar-Hazy Center, one of the most amazing aviation museums in the world.
• The museum opened in 2003, the 100th anniversary of the Wright Brothers’ first flight.
• Udvar-Hazy wanted to give back to America and inspire young people to be interested in aviation and space.

Summary

Steven Udvar-Hazy’s Journey: Escaping Hungary and Pursuing Aviation

Steven Udvar-Hazy’s obsession with airplanes started at a young age and was fueled by a desire to escape communist Hungary. His family’s escape from Hungary was filled with challenges and close calls. Settling in Manhattan, Udvar-Hazy’s passion for aviation grew as he spent hours watching planes at LaGuardia airport. He pursued a career in aviation, becoming a successful pilot and aviation journalist. His fascination with planes and his remarkable memory for details about airplanes set the foundation for his future success.

Building Air Lease Corporation: The Power of Leasing

Udvar-Hazy’s business success came from leasing planes to airlines rather than owning them. He started Air Lease Corporation with the goal of having 8-10 planes and making a nice living. However, he underestimated the potential of the market. Buying aircraft in bulk allowed for better leverage in discounts and more weight, leading to significant growth for his company. Eventually, AIG made a massive offer to buy Air Lease Corporation, resulting in a 50 times greater return for investors.

Philanthropy and Legacy: Inspiring the Next Generation

Udvar-Hazy’s massive donation helped finance the Stephen Udvar-Hazy Center, an aviation museum that opened in 2003. His goal was to give back to America and inspire young people to be interested in aviation and space. The museum showcases the history of aviation and serves as a reminder of Udvar-Hazy’s passion and impact on the industry.

Conclusion

Steven Udvar-Hazy’s journey from escaping Hungary to building Air Lease Corporation showcases his passion for aviation and his ability to identify opportunities in the industry. His success in leasing planes to airlines revolutionized the aviation industry and made him one of the most influential figures in aviation. Through his philanthropy, he continues to inspire the next generation of aviation enthusiasts. Steven Udvar-Hazy’s story is a testament to the power of determination, passion, and innovation.