Aviation Finance

Developments

Latest edition (February 2nd): Investment and innovation remain alive and well in commercial aviation
February 2nd 2023: In the latest issue, Aircastle continues to scale up its borrowings while SKY Leasing reveals the breadth of investor types attracted to its highly successful Sky Fund V; Icelandair has employed Castlelake’s new Bermudan reinsurer, Itasca Re, while Pegasus Air has closed what is said to be ‘the first ever sustainability-linked aircraft-secured term loan’, guaranteed by UK Export Finance.

January 19th edition: Industry consolidation a recurring theme
January 19th 2023: Industry consolidation, fresh investment and continued disappointment with the inability of the OEMs to deliver were three themes constantly repeated during this week’s aviation finance conferences in Dublin. Overall, however, the mood music coming from industry’s executives is anticipating further strong improvements in the marketplace this year.

 

Perspectives

Lessors place big orders with Boeing and Airbus


The latest batch lessors look to a peace to come includes one of the largest orders this year, for 80 A320 family aircraft by BOC Aviation, and the firming up of an order with Boeing for 32 MAXs from ALC.
Sanctions present varied legal issues for lessors
Insurers ponder true extent of their claims exposure
Delta, easyJet and Wizz see blue skies ahead
Assets trapped in Russia are an operational nightmare for financiers and lessors

Developments

January 5th edition: Post-COVID tailwind trumps socioeconomic uncertainties
January 5th 2023: The commercial aviation industry anticipates a return to strong growth in demand for its services despite real concerns over a range of challenges – from the continuing impact of Russia’s attack on the Ukraine, a possible global recession, rising inflation, fuel costs and interest rates. United’s record breaking order for up to 200 Dreamliners plus 100 737MAX aircraft underscores that confidence.

December 8th edition: IATA expects airline profits in 2023
December 8th 2022: IATA’s upgraded forecast for the global airline industry reflects a balanced view of the competing pressures that it faces in the short to medium term. There are many positives but there is also a fragility, not least in a predicted profit margin for the industry as a whole as thin as about a half a per cent. However, there are also good grounds for hoping that this will improve significantly over time.; Between them, Air Lease Corp and Aircastle have raised over $1 billion in fresh funding.

November 24th edition: Resilience of commercial aviation still strongly evident
November 24th 2022: The sheer resilience of aviation in the face of geopolitical and economic uncertainty is once again evident in this issue of Aviation Finance. IATA DG Willie Walsh is encouraged not just by the airline profit recovery in Q3, but particularly by positive trends in load factors. And SMBC Aviation Capital, which saw its HI profits rise 43 per cent, anticipates a continued improvement in line with the ongoing recovery in the global airline sector.

 
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Latest edition (November 10th): International air traffic recovery now proving strong
November 10th 2022: With the notable exception of China, the recovery in air traffic across the world continues to prove robust. International RPKs are now running at 70 per cent of 2019 levels, with all markets, led by Asia-Pacific, recording strong growth. This is being reflected in airline profitability and the financial performance of leading providers of aviation finance. Boeing targets return to 800 deliveries a year; Airbus still on for 700 deliveries this year; IAG confirms Boeing and Airbus orders; Emirates orders five 777Fs; Chinese lessors order 300 C919s; ATR cuts losses; STARLUX takes delivery of first of 18 A350-900 aircraft; BOC Aviation delivers B787-9s to Norse Atlantic ; GA Telesis delivers three A320 to SmartLynx; ACG delivers 737-9 MAX to Copa; SAEL in four engine sale & leaseback; NAC enters narrowbody market; Natixis provides PDP financing for Azorra Aviation; Segor joins ACG as CFO.

October 27th edition: Despite concerns about pace of recovery, robust demand is seen 'at attractive lease rates' for young fuel-efficient aircraft
October 27th 2022: Q3 was Avolon's best quarter since the pandemic began; Although EUROCONTROL has expressed concerns about the pace of the recovery in air traffic, many carriers are already back to the levels of traffic seen in 2019; The appetite for new, fuel efficient aircraft remains strong against the backdrop of supply constraints and labour shortages, as the world’s carriers anticipate future growth prospects.

October 13th edition : SKY Leasing sells 36 plane portfolio to DAE as new deliveries rise again
October 13th 2022: SKY disposes of portfolio to DAE; Also in this issue: CO2 challenge facing the aviation industry and how 2 airlines are approaching their lessors in very different ways; Airbus deliveries up again in September; ALC places aircraft, issues Q3 update; Senior appointments at Avolon.

 

Developments - 2021

September 29th edition: Aviation continues to create opportunities for investors and financiers
September 29th 2022: Geopolitical uncertainties notwithstanding, commercial aviation continues to create new opportunities for investors and financiers. In this issue we look at the difficulties being faced by Boeing in China as authorities there drag their heels on the return of the MAX. But we also report on the continued appetite for aviation exposure by the likes of Apollo Global Management, with its $1.5 billion support for Embraer sales, a $1.725 billion syndicated bank facility for SMBC Aviation Capital and $400 million bank finance for TrueNoord.

September 15th edition: Recovery in air travel strengthens as airlines, OEMs and lessors re-position for growth
September 15th 2022: The recovery in air travel and the semblance of a return to a kind of normality is gaining traction throughout the industry. Despite the many challenges facing world economies and industries aviation is making realistic plans for a brighter future ahead. In this issue, a recovery in deliveries by Boeing, and continued strong demand for Airbus added to the positive activity on the leasing side - including in sale/leasebacks and financing, show this.

September 1st edition: Carriers worldwide are still expecting a strong upsurge in demand
September 1st 2022: Against a backdrop of inflation fears, high fuel costs, environmental concerns and labour difficulties, a pattern of continuing fleet adjustments is increasingly evident. Despite these immediate concerns, carriers worldwide are anticipating a strong upsurge in demand and seeking to competitively position themselves to avail of it. Many of the stories in this issue reflect these trends.

August 18th edition: Leasing finds new opportunities
August 18th 2022: Commercial aviation has made a remarkable recovery since the world’s airlines were plunged into losses of some $35 billion last year. The evidence of optimism is now widespread. In this issue, for example, we report on Moody’s predictions that global airline operating profits could exceed $20 billion next year, while leading aircraft leasing executives such as Aengus Kelly, John Pleuger and Robert Martin all comment enthusiastically on the healthy outlook across all segments, including widebodies, cargo and rotorcraft.

August 4th edition: A return to airline profitability
August 4th 2022: As more airlines report their performance in the three months to end June, it is increasingly apparent that some have already managed to return to profit while others anticipate that they will do so for their full year. An upturn in yield has helped to offset the impact of rising costs, as have cargo revenues for many, but it is notable that the recovery includes low cost as well as traditional carriers. Those back in the black in Q2 include United, IAG, Lufthansa, Ryanair and Singapore.

July 21st edition: Successful Farnborough Air Show marks return to 'normality'
July 21st 2022: Even if orders were on the light side, the show demonstrated that the aviation industry is coping well at a time of ongoing stress. There continues to be interest in, for example, and funds available for, the sale and leaseback market while the aircraft manufacturer’ latest commercial market outlooks remain optimistic for the next two decades. Also: a resilient aviation sector is reflected in the latest Market Outlook presentations from three of the four main commercial aircraft manufacturers. In its Commercial Market Outlook 2022–2041 Boeing says the global market is recovering just as it had projected in 2020 and it forecasts a market value of $7.2 trillion for new airplane deliveries over the next two decades