Aviation Finance

Developments

The March 21st edition of Aviation Finance is published
In the latest issue: The implications of the Boeing MAX8 tragedy and what can and must be done; In the meantime, trends across the aviation finance universe show that life goes on, even as participants reflect on the crisis that has beset Boeing’s new aircraft programme. Avolon’s inaugural term-loan facility, launched at $300 million was increased to $500 million; Orix Aviation has revealed big plans for its own fleet growth to 320 aircraft by 2021; and Boeing and Airbus have received confirmed orders from Lufthansa Group for 20 787-9 Dreamliners and from Taiwanese start-up StarLux for 17 Airbus A350 XWBs.


The March 7th edition of Aviation Finance
In the March 7th issue: The latest results from leasing companies, and the totality of indicators reported in this and recent issues of Aviation Finance continue to point to a buoyant outlook for aircraft and aircraft financing in the medium term, and several articles, not least the move by MUFG to acquire the banking assets of DZ Bank in the aircraft space is indicative of both the particular health of the commercial aircraft sector and the new models of financing that we in this publication always seek to profile.

 

Perspectives

Is there scope for improvement in the relationships between aircraft manufacturers and lessors?

Peter Chang on the relationship, reflecting the role that the latter now play.

IBA's Stuart Hatcher on values and lease rates
Willis LF's Brian Hole: 'Time to Uberize spare engines'
Marsh's Bob Morin on AFIC's first year
ELFC's Jon Sharp on the engine leasing market

Analysis

The February 21st edition of Aviation Finance
In the February 21st issue: Buoyant results from manufacturers, and record stock prices with Boeing at over $400 this month, positive results from lessors, successful business being written by AFIC, as Bob Morin reports in our Perspectives column, and evidence of balanced passenger growth from all regions of the world; Our features, on the start of the ABS year, and the ending of an iconic production line in the form of the A380.


In the February 7th edition of Aviation Finance
In the February 7th edition: New Leasing IFRs in place since Jan 1st and their relevance to the impairment issue and hedge accounting; ABS prospects for 2019 - $26bn issued and more to go; Freight - IATA data not good; A380: Emirates next move could be decisive; Blockchain to revolutionise novation in lease documentation; A tough week in the European LCC space, and much more in the latest issue of Aviation Finance.

IBA's Phil Seymour: kicking the impairment can down the road
In the January 24th 2019 issue of Aviation Finance: Phil Seymour, the CEO and President of IBA in an exclusive interview expresses his concerns that delays in new aircraft deliveries and low oil prices have allowed airlines and lessors kick the impairment can down the road.

 

From Our Latest Issues:

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Financing & Risk Strategies

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Exclusive interview with the CEO of CDB Aviation Leasing, Peter Chang
January 10th 2019: in the first issue of Aviation Financein 2019:Exclusive interview with the CEO of CDB Aviation Leasing, Peter Chang; Boeing and Airbus hit their 2018 delivery targets; Joe Gill uses a 'Wall of Worry' analysis to assess market prospects for aircraft leasing stocks; KKR to invest $1 billion in Altavair AirFinance as part of a long-term partnership to create a global portfolio of leased commercial aircraft; Falko's Avolon deal, which, ‘puts us squarely in the upper echelons of the regional aircraft market’.

Leasing to gain further market share as airline business models shift away from ownership
The future is bright for global aircraft leasing and it looks set to grow its share of the global aircraft fleet further as airlines increasingly follow a business model prevalent in another asset-heavy industry, the international hotel industry, according to Avolon CEO Domhnal Slattery.

AerCap CEO: leasing sector better prepared for a downturn now than it was 10 years ago
Aercap, the world's largest owner of commercial aircraft, released financial results for the quarter ending September 2018. Net income was relatively flat year on year at $263.4m while earnings per share grew 10%, boosted by a share repurchase programme that commenced in July 2017.

 

Analysis

Lessor paradox: Rising interest rates could moderate intense competition
The highly competitive landscape in the aircraft leasing industry is likely to remain a theme for the near-term and drive further consolidation. However, rising interest rates, while not good for funding, could help slow the inflow of capital into the industry and moderate some of the negative effects of intense competition stemming from the abundant liquidity, particularly for established players who have maintained underwriting discipline, according to a new report from KBRA.

European airline CEOs talk up further market consolidation
A number of key European airline leaders are flagging further consolidation in the airline industry as the sector grapples with fragmentation, high oil prices and excess capacity. These features are especially pronounced in Europe where demand growth rates lag those of markets such as Asia.

Singapore sovereign fund GIC takes stake in NAC
In an announcement made jointly by Nordic Aviation Capital, its founder Martin Moller and investor EQT VI, it has been disclosed that GIC, Singapore’s sovereign wealth fund, is to become a significant minority investor in the world’s largest lessor of regional aircraft. The transaction will involve a partial sale by the existing shareholders and the introduction of new capital to further strengthen NAC’s balance sheet, the parties said.

Performance of Delta's A220 roll out significant for plane's commercial success
The US carrier Delta has revealed plans for the operational deployment of its new Airbus A220 aircraft. In so doing it is providing a platform within a large established mainstream carrier in which the A220 can be assessed from an economic and customer experience perspective. Delta is the most significant US customer for the former C Series aircraft, having ordered a minimum of 75 units.

Carlyle Group's purchase of Apollo Aviation reflects sector's growth prospects
The Carlyle Group is the latest big name institutional asset manager to make a substantive, long-term commitment to the aircraft leasing and finance sector. In a move which reflects confidence in the underlying prospects of the sector's future growth, and in the strength of an existing well-established platform, the global alternative asset manager is acquiring Bill Hoffman and Robert Korn's Apollo Aviation Group and its affiliates for an undisclosed sum.

Optimum ownership structure for leasing platforms
The question of ownership models emerged at the Aviation Finance Conference 2018 as an interesting side theme to which executives from a number of the leading aircraft lessors contributed their thoughts writes Aviation Finance's John Stanley.