In 2023, the sector of commercial aircraft financing will return to a level close to the pre-pandemic of Covid-19 according to Boeingwhich has just presented its market forecasts.
On March 16, 2023, the American aircraft manufacturer presented the latest edition of its annual study devoted to the aircraft financing market (CAFMO — Current Aircraft Finance Market Outlook), which forecasts another year of recovery, as well as an increase in the request from financial players and investors of the aviation sector. The 2023 edition of the study covering in parallel the evolution of the commercial aviation and air services market over a period of 20 years, “reflects the short-term vision of the market dynamics according to Boeing, and is evaluating sources of financing for the delivery of new commercial aircraft,” said a press release. Which highlights the main lessons of this CAFMO:
- In 2022, Boeing aircraft were mostly cash financed thanks to strong operational performance and customer deleveraging initiatives.
- Although cash financing will continue to play an important role in financing deliveries, the use of capital markets, bank debt and export credits should increase.
- In 2022, capital market activity was less than in 2021, a year marked by very strong activity.
- Last year, export credit agencies financed nearly 5% of Boeing deliveries.
- Deliveries handled by aircraft leasing companies will remain stable, but might face competition from other sources of financing.
« Given the increase in production and deliveries, as well as the reopening of certain regional markets, we expect aircraft financing needs to reach levels in 2023 close to those we experienced before the pandemic. said Rich Hammond, Boeing vice president of customer financing. “This positive trend confirms that the fundamentals of our industry are solid and that aerospace financiers and investors are well positioned, while air transport continues its recovery».
According to the CMO 2022 report (Boeing 2022 Commercial Market Outlook), the global market is recovering, in line with forecasts published by Boeing in 2020. Regarding domestic flights, demand has recovered strongly in several regions, while international traffic continues to recover as health restrictions ease; it is expected to recover to pre-pandemic levels between 2023 and 2024, as also predicted by IATA.
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