BOC Aviation is carefully watching what chief executive Robert Martin calls extremely "uncertain" market conditions this year before embarking on the next phase of the Chinese-owned lessors growth.
"Last year was an easy year to read because it was so bad," says Martin, whereas "mixed signals" from the various regions in terms of the shape of the recovery, the volatility of fuel prices, new entrants into the leasing market and the availability of financing make predicting market conditions tough.
BOC Aviation, however, does have undrawn cash lines of $1.2 billion meaning that it can move quickly if it needs to, says Martin. "Although we will always be cautious in terms of the number of planes we order I don't rule out a top-up order if the right deal comes along." These could be new aircraft from the manufacturers or sale and leaseback deals with airlines.
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Robert Martin: steering BOC through uncertain market conditions |
Today BOC Aviation has 154 aircraft on its books after boosting its fleet by acquiring 45 aircraft in late 2008 and early 2009 in a $2.3 billion spending spree. "That was a once in a lifetime opportunity and we took it," says Martin. It conducted deals with top-tier carriers like Air France, Cathay Pacific and Southwest Airlines. "A lot of carriers see us as a safety net," says Martin.
BOC Aviation now only has to place four aircraft out of its 90-strong backlog of new types that it ordered in 2005/06. It is taking 31 aircraft this year and has leases arranged for all deliveries up to September 2011, says Martin. "Now we are preparing for the next phase of the cycle," he adds.
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Source: Flight Daily News
