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Boeing told Asian bankers and financiers here that Asia continues to play a pivotal role in global aviation, including aircraft financing.
“Asia was clearly the engine that pulled the global aviation sector out of its doldrums in terms of the bulk of the growth, speed of recovery and continued strength,” said Kostya Zolotusky, managing director for capital markets development for the company’s customer financing unit, Boeing Capital Corporation.
Zolotusky was among presenters November 3 at Boeing’s Financiers and Investors Conference for Asia and Greater China. The annual event presents the company’s view of aircraft financing market conditions and provides updates on its new airplanes including the 787 Dreamliner and 747-8.
Asian financiers on hand this year numbered about 175, representing the company’s largest Asia conference to date. Boeing positively updated its view that Asia has weathered the economic storm better than most economies.
“Today, there’s an even greater sense of confidence in the strength of the Asian engine,” Zolotusky said.
The company credits Asia’s banks as playing an important role in aviation finance, led by China, and including those in Australia, as well as major sector players such as HSBC and Standard Charter Bank.
“Asia’s demand was the key. And that includes demand for markets for aircraft, passenger travel and aircraft finance,” Zolotusky said.
China’s burgeoning aircraft financial markets shines most bright, according to Foster Arata, Boeing Capital V.P. for Asia and Greater China and the conference host.
“The Chinese continue to do a lot of aircraft financing inside China, both for operating leases and finance leases, and China’s continued to expand globally in both the financing and leasing arenas,” said Arata.
As examples, he cited recent financing by ICBC to Qatar Airways for four Boeing 777-300LRs and the acquisition by CDB Leasing and ICBC of aircraft portfolios now resident in Ireland, the world’s leading aircraft leasing base, thus expanding the Chinese franchises.
The financing market update came as Boeing also reaffirmed Asia Pacific’s leading role in aviation growth.
The region’s economy is predicted to increase at a rate of 4.6 percent per year for the next 20 years. Boeing’s latest market outlook says the region over that time will need more than U.S. $1.3 trillion in new commercial airplanes, and the commercial fleet will nearly triple, from 4,110 airplanes in 2009 to 12,200 airplanes in 2029.
The region’s recent double-digit freight recovery lends credence to predictions that its air-cargo market will lead all global air traffic routes, with domestic Chinese and intra-Asian markets growing at 9.2 percent and 7.9 percent per year, respectively.
As Boeing’s investment bankers, Boeing Capital works closely with third-party financing sources that provide nearly all of financing support required by Boeing customers. BCC also managed the company’s $5 billion portfolio of approximately 300 aircraft, many of them newer, fuel efficient jetliners.
Vicky is the co-founder of TravelDailyNews Media Network where she is the Editor-in Chief. She is also responsible for the daily operation and the financial policy. She holds a Bachelor's degree in Tourism Business Administration from the Technical University of Athens and a Master in Business Administration (MBA) from the University of Wales. She has many years of both academic and industrial experience within the travel industry. She has written/edited numerous articles in various tourism magazines.
