As we passed the half-year mark, questions remains on this year's funding issue and where the liquidity comes from, but as the Euro does not seem to lose any ground on the US dollar, calls are emerging again to purchase aircraft in non-US dollar denominated currencies.
At the Aviation Finance Europe conference in London, Head of Global Aviation & Rail Finance, Credit Agricole-Corporate Investment Bank (CA-CIB) Jose Abramovici raised the issue of the currency used in the aircraft acquisitions.
"I see no reason why the US dollar should remain the 'king' currency for selling aircraft when some OEMs and subcontractors are located outside the United States," comments Abramovici.
"I tried to raise this issue 10 years ago but I did not get any reaction from my counterparts," he adds.
"The Euro is not a negligible currency and part of aircraft acquisitions should be indexed in Euros. In the end an asset represents the value of cash flows it generates throughout its entire life."
BOC's deputy managing director and CCO Steven Townend says that currencies have strengthened against the dollar over the past few years, and when airlines try to sell aircraft they struggle to achieve the returns. "Lots of airlines are taking losses when selling aircraft from their balance sheet," he says.
However DVB Bank managing director head of aviation financial consultancy Michel Dembinski is sceptical on aircraft being priced in a currency other than the US dollar. "I don't see this happening in a foreseeable future. In the end changing a currency will only be a transfer of the risk," he comments.
Abramovici says the focus should not be about a single currency as an alternative to the US dollar. "Most of the times, aircraft gets built by a consortium of companies and as such we should focus on a basket of currencies," he says.
"A single currency is not the solution, but we should inject non-US dollar currencies in pricing aircraft," he adds.