Wednesday, February 25, 2009

Future of Aircraft Leasing Market

This is an interesting article on the predicted growth of the aircraft leasing market. I would be interested to hear any ones comments on where they believe the market will go.

Global Aircraft Leasing Market to Reach $279 Billion by 2015, According to New Report by Global Industry Analysts, Inc.

Fuel prices remained high during the first half of 2008, prompting many carriers worldwide to replace their older fleet with fuel-efficient new aircraft models. As a result, leasing companies with new models in their fleet witnessed increased activity. Prevailing credit crunch in the airlines industry and a general shift in preference towards aircraft leasing are projected to push the global leased aircraft portfolio size to $279 billion by 2015.

San Jose, CA (PRWEB) February 19, 2009 -- Losses to the airlines industry can sometimes mean gains to the aircraft leasing industry, as airlines seek to hold up their balance sheets by resorting to leasing an aircraft. This is particularly reflected in the current scenario, where aircraft leasing companies are continuing to make profits, despite a slowdown in the global airlines. The market is witnessing continued leasing deals being signed between the leasing companies and airlines worldwide. Dearth in financial resources to fund internal purchases of aircraft may force many airlines to increasingly rely on aircraft leasing companies.

Lease rates began declining even for most favored aircraft, affecting revenues for leasing companies. Further, airline closures and capacity rationalization among airlines may force leasing firms to postpone or cancel orders and focus on re-placing existing fleet. However, the market is expected to witness a surge in airlines' reliance on sale-and-lease-back agreements for financing aircraft purchases, keeping the prospects of leasing companies buoyant.

Europe and US represent the largest markets for aircraft leasing, in terms of leased aircraft portfolio value. Despite maturing Western European airline market, the overall European aviation industry is booming, owing primarily to growth in Eastern Europe. Asia-Pacific represents the fastest growing market worldwide, with a projected compounded annual growth rate of more than 10% during the next few years.

Commercial Jets represents the largest category in the global aircraft leasing industry, while Business Jets represent the fastest growing segment.

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