Boeing reports increased stability, growth for aircraft finance sector

SAN FRANCISCO, May 2 (Xinhua) -- Boeing Capital Corporation, a wholly-owned subsidiary of the Boeing Company, on Monday released the 2022 Commercial Aircraft Financing Market Outlook (CAFMO), showing improving financing stability as the industry recovers from the impacts of the global pandemic.

"Financiers and investors remain committed to the long-term fundamentals that continue to make aircraft a valuable asset class," said Tim Myers, president of Boeing Capital Corporation. "Despite the changing landscape since the emergence of the COVID-19 pandemic, the industry remains resilient and there continues to be sufficient liquidity in the market for our customers with increasing opportunities as traffic recovers."

The 2022 CAFMO reflects Boeing's near-term view of market dynamics and assesses financing sources for new commercial airplane deliveries.

"Industry fundamentals continue to show varying degrees of strength in different markets that reflect the regional trends of the global pandemic," Myers said.

For the second consecutive year, 100 percent of Boeing deliveries were financed by third parties with the top sources of delivery funding in cash, capital markets and sale leasebacks, according to the report.

The capital markets continued to play a key role in shoring up liquidity for the sector, with the market close to pre-pandemic levels for most issuers as spreads tightened throughout the year.

Secured debt for lessors also made a return to pre-pandemic levels with the ABS market making a comeback with volumes at around 8.7 billion U.S. dollars, as lessors took advantage of the favorable rate environment, the report said.

According to the company, export credit supported financing for Boeing aircraft contributed about 5 percent of total funding last year, primarily by the Export-Import Bank of the United States and with one deal supported by UK Export Finance.

The Boeing 2021 Commercial Market Outlook, a separate annual 20-year forecast addressing the market for commercial airplanes and services, projects that through 2040 there will be demand of more than 43,500 new airplanes valued at 7.2 trillion dollars.

Boeing Capital Corporation is a global provider of financing solutions, and offers asset-backed lending and leasing, concentrating on assets that are critical to the core operations of Boeing customers, according to the company.