The business-jet market has never been in better shape, according to two leading aviation finance providers here at the show. And while some softening is inevitable under present global economic conditions, it is the used-aircraft sector rather than manufacturing that will bear the brunt in the short term.
Mary Schwartz is managing director of US institution Citi Private Bank’s aircraft finance arm, which she set up in 2001. “A year later the market hit its last trough, only to recover faster than expected,” she says. “Now conditions are far more favourable – it’s a global market rather than a US-centric one, and the leading manufacturers all have healthy backlogs.”
Last year 52% of Citi Private Bank’s new aviation business was international in origin, compared with next to none three years earlier. “Demand is coming from Russia, the Middle East, Latin America, Australia, and Hong Kong, Singapore and India in Asia,” says Schwartz.
New takers for the Bombardier Global Express must now wait until 2012, while the queues for the Dassault Falcon 7X and new Gulfstream 650 extend to 2014. “And the manufacturers have the luxury of knowing that if a customer drops out there are people willing to pay a $10 million premium for the slot.” says Schwartz.
She is echoed by Veronique Leroy, European marketing segment leader at GE Capital Solutions. “We’re completely in line with that analysis,” she says, “except that we think the softening has already started in the used sector. And even that has a regional dimension – though second-hand sales are slowing in the USA and Western Europe, they’re still booming in eastern Europe, the CIS and the Middle East.”
Mary Schwartz is managing director of US institution Citi Private Bank’s aircraft finance arm, which she set up in 2001. “A year later the market hit its last trough, only to recover faster than expected,” she says. “Now conditions are far more favourable – it’s a global market rather than a US-centric one, and the leading manufacturers all have healthy backlogs.”
Last year 52% of Citi Private Bank’s new aviation business was international in origin, compared with next to none three years earlier. “Demand is coming from Russia, the Middle East, Latin America, Australia, and Hong Kong, Singapore and India in Asia,” says Schwartz.
New takers for the Bombardier Global Express must now wait until 2012, while the queues for the Dassault Falcon 7X and new Gulfstream 650 extend to 2014. “And the manufacturers have the luxury of knowing that if a customer drops out there are people willing to pay a $10 million premium for the slot.” says Schwartz.
She is echoed by Veronique Leroy, European marketing segment leader at GE Capital Solutions. “We’re completely in line with that analysis,” she says, “except that we think the softening has already started in the used sector. And even that has a regional dimension – though second-hand sales are slowing in the USA and Western Europe, they’re still booming in eastern Europe, the CIS and the Middle East.”
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Source: Flight Daily News
