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HONG KONG • The aircraft finance industry is experiencing an unprecedented $ 280 billion (US $ 385 billion) boom, as rising interest rates, falling competition and soaring oil prices are shaking up the industry
Last week in Hong Kong, more than 1,000 financiers, lawyers, and airline managers spoke of the fundamentals of a sector that is still in business. is imposed as a thriving badet clbad in the world. The atmosphere foreshadowed a moderate optimism even as the plugs blocked new agreements.
Concerns about the tightening of the central bank, trade disputes and currency fluctuations could blow a little, he warned.
interest rate, "said Robert Martin, chairman and chief executive officer of BOC Aviation, the largest Asian-listed aircraft maker.
The 30-year veteran of the industry has noted that smaller players who had not equaled their funding should Unlike large corporations like his company, it would be difficult to resist any volatility.
This failure has caused large-scale collapses, such as Guinness Peat Aviation ( GPA) in the 1990s.
Former GPA executives, who now dominate the sector, said the sector had matured and was supported by diversified sources of funding, with aviation funding proudly standing alongside real estate and infrastructure as an alternative to traditional bets on the market.
It's like driving a car on the highway. world is on the accelerator pedal right now. Nobody goes to the gas station or takes a break. Everyone is thoroughly, but something must give.
M. BRIAN CHENG, executive director of NWS, who bought this year Dublin-based Sky Aviation Leasing, on the withdrawal of small players.
Danger signs have emerged, such as a strong dollar hitting the coffers of many airlines just as they must adapt to soaring oil prices.
This could cause undesirable planes to return to landlords who have to find new tenants.
International airlines have already reduced their profit forecasts because of high oil prices.
Some leasing companies are also quietly "renting" airlines to improve their cash flow, sources said.
million. Rob Morris, chief consultant for Flight Ascend, said Rob Morris, Senior Legal Counsel for Flight Ascend.
According to Mr. Stuart Hatcher, Managing Director of Asset Management Companies (IBA), "the market is ready for the beginning of a correction, there are too many signals."
The Sector Remains however, in better shape than in previous cycles, under the effect of consolidation in the United States.
Airlines have begun to recover their capital costs over the last four years. Decades of value destruction, according to the International Air Transport Association.
The demand for funding for new commercial aircraft deliveries is expected to increase by nearly 7% this year, to reach 139 billion US dollars, Boeing said.
Last week, financiers They were busy negotiating agreements with views of the port of Hong Kong, in the port of Hong Kong, at conferences organized by Airline Economics and the journal Airfinance Journal of Euromoney.
Chinese capital accounts for about 30% of the financing deployed by leasing companies worldwide, compared with 5% nine years ago.
But as long as the carousel continues,
Goshawk Aviation, a Hong Kong conglomerate company NWS Holdings and Chow Tai Fook Enterprises, argues that the low yields of this sector are not achievable for long.
million. Brian Cheng, executive director of NWS, who bought Dublin-based Sky Aviation Leasing this year, said he has seen offers of financing from companies willing to accept a return on investment of 3 to 5% on their investments in planes. "Insurance companies or banks can reach (these rates) because their borrowing costs are so low … but for us, there is no way to compete with that. "
In this context, opportunistic mergers and acquisitions are also developing.
The Japanese company Orix Corp. signed a US $ 2.2 billion contract this year for a 30% stake in leasing company Avolon Holdings. SMBC Aviation Capital, the leasing arm of Sumitomo Mitsui Banking, expects to receive an additional $ 1 billion from its shareholders in the next few months, said Peter Barrett, CEO of the world's No. 5 lessor. .
But with air pockets in sight, the leaders of the industry evoke an upheaval expected among small donors.
Mr. Cheng said, "It's like driving a car on the highway, everyone is on the gas pedal right now, no one goes to the gas station or takes a break. the world is at full speed but something has to give in. Some cars will just go to the exit. "
REUTERS
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