Commercial jet orders could hit 3,500 units in 2013

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DVB Bank anticipates another record year in terms of firm orders for commercial jets.

In a presentation at the 2020 Ascend Finance Forum in London, DVB Bank's managing director global head aviation research Bert Van Leeuwen said "orders are accelerating in 2013."

Citing Flightglobal's Ascend database, Van Leeuwen said 1,882 firm orders were placed during the first half of this year compared with 1,163 for the first six months of 2012.

"This year's firm orders figure is a lot higher than any figure before. If we apply the average conversion rate into the firm orders, the manufacturers could look at 3,500 firm orders in 2013."

Van Leeuwen says the 3,500 figure is a mechanical calculation but there could be a correction. "These are orders signed on paper but this is tangible. If we have an economic downturn, there will be a correction."

In 2012, commercial jet orders reached 2,574 units, while in 2011 a total of 2,838 firm aircraft orders were placed.

Van Leeuwen believes continuing high fuel prices will drive demand for new generation aircraft but he also notes that 31% of this year's narrowbody orders are current Airbus A320 and Boeing 737 aircraft.

As such, he sees a high probability of steep value loss for late production aircraft.

"Last off the line aircraft are still being ordered as interim lift for new generation aircraft, but will be more impacted in terms of residual values," he says.

He notes that Airbus and Boeing's current and next generation orders and options currently exceed the in-service fleets.

"It is clearly the intention of the industry to continue ordering aircraft," he says, adding that not many of this year's orders will be delivered during the next two to three years, but acknowledges that the backlogs from the manufacturers are being stretched.

"What is also interesting in this year's figures so far is that 12% of orders come from operating lessors with the remaining 88% being airline orders," he says.

Van Leeuwen points out that North America and Europe, two slow growth areas in terms of gross domestic products, are the lead region in terms of orders.