Boeing Co. forecast “fewer risks and greater liquidity for all” in aircraft financing this year as investors, private equity and hedge funds return to a market they abandoned in the 2008 global credit freeze.
“The industry overall will have adequate availability of reasonably priced capital,” Kostya Zolotusky, a managing director at Boeing Capital Corp., said in an e-mail reply to Bloomberg questions. The funding unit of the world’s biggest aerospace company predicts aircraft delivery financing will jump to $77 billion in 2011 from $62 billion last year.
Boeing said the increased flow of money into planes is driven by “sustained real product demand” as a global economic rebound spurs travel. The International Air Transport Association estimates 2010 airline profit jumped to a record $15 billion after the industry lost $50 billion in the past 10 years, including $9.9 billion in 2009 alone.
“Waves” of aircraft financing funds have been returning since early last year, said Bertrand Grabowski, a board member at DVB Bank SE, a German lender that aims to make $2.3 billion in aircraft loans this year.
“Liquidity is going to the best names,” Grabowski said yesterday in an interview. “For those, rates are at the level where most banks cannot get financing themselves.”
Borrowing costs for “top-tier” airlines such as Air France-KLM and Deutsche Lufthansa AG are falling to as low as 150 basis points above the London Interbank Offer Rate, compared with between 350 and 400 basis points above the benchmark two years ago, Grabowski said.
Fleet Expansion
Companies including American International Group Inc.’s aircraft leasing unit, the world’s biggest, are ordering new jets to expand and replace less fuel-efficient models. International Lease Finance Corp. plans to buy about 100 narrow- body jets, its first order since 2007, as it seeks to grow after its parent’s U.S. bailout, two people with knowledge of the matter said this week.
Air Lease Corp., the company formed by the former ILFC head Steven Udvar-Hazy, is seeking $100 million in an initial public offering to help pay for new jets as it aims to more than double its fleet.
Air Lease predicts planes on lease will increase by more than 25 percent in the next five years. Boeing and Airbus SAS are boosting production to record rates to work off a seven-year backlog of orders amid demand for newer, more fuel-efficient planes.
-------------------------------
Read more Aviation News http://www.bloomberg.com/news
View Model Aircraft
No comments:
Post a Comment