advisory

CHANCE FAVOURS
THE PREPARED

2018 Aviation Finance Market Forecast

Inform your investment strategy and make critical decisions with confidence

Ishka Vista: 2018 Aviation Finance Market Forecast delivers a trusted and independent assessment of the aviation finance landscape to help identify markets, products and assets that offer the greatest return on investment and the best potential for growth

As the market enters the next phase of the aviation cycle, I’m delighted to introduce Ishka Vista: 2018 Aviation Finance Market Forecast.

The requirement for new aircraft funding is expected to reach US$140+ billion in 2018. With record deliveries, an active secondary market and bank liquidity at an all time high, the aviation finance market appears buoyant. However, the sands are shifting below our feet.

Markets are evolving, leading to potential changes in demand for different types of aircraft; some market sectors are becoming riskier, both politically and socio-economically, and the competition to both acquire and place aircraft is driving aggressive transaction terms. When airlines also start showing signs of over extending, it becomes increasingly critical to be doing the right deals, with the right assets and airlines, at the right price.

Eddy Pieniazek

Eddy Pieniazek
Head of Advisory

Section One

The End of 2017: Industry signals and current trends

2017 has seen some major airline failures and increasing pressure on airline yields, despite oil price remaining relatively low. 2018 will prove you can still lose money in this game.

Section Two

External factors impacting the aviation finance industry

50% of new deliveries in 2018 could be financed via sale and leaseback arrangements but given the new accounting regulations, will airlines look to alternative funding options?

Section Three

The demand for aircraft finance in 2018

Is aircraft production a ‘runaway train’? $140 billion is required to cover 2018 new aircraft deliveries. However, with 1 in 4 scheduled for China, can their infrastructure handle such an increase in capacity?

Section Four

The supply of aircraft finance in 2018

The ‘Wall of Cash’ from China and investors around the world are revisiting their criteria. Lessors face continued consolidation pressures in order to better manage future risk and exposure. This is not a static play! Expect some turbulence.

Section Five

The impact on aircraft values and lease rates

The Consensus view suggests market values for widebody types such as 777-300ERs and A330-300s are coming under more pressure than lease rates. When there’s more confidence in renting the utility than in owning it, be alert to the market signals. Click here for more information on Ishka Consensus Values

Section Six

The Ishka View

The good years are not necessarily behind us, but we are ticking more and more boxes that point to some difficult times ahead. While profitability doesn’t go away altogether, it does get harder to locate. this report will help you find it.

expert analysis and assessment of

Global aviation finance markets

Which markets are primed for growth and which are in decline? Where should you plan to focus your resources and make key strategic investments?

25 key international airline groups

These 25 specially identified carriers are responsible for 50% of new aircraft deliveries by volume and value in 2018. Ishka's new Airline Credit Score determines which of these airlines are performing well and which ones are exposed to a bumpier ride. Click here for more information about Ishka Airline Credit Score

Attractive classes of aircraft types and assets

It’s a complex world of choices. Financiers can opt for lower-risk, lower-yield new-build aircraft types, or focus on older assets with their lower capital costs and higher margins, but with higher levels of risk in terms of demand, marketability and maintenance burden. In between the two, are a myriad of other investment options. Which sectors are facing change in 2018?

Deal structures and deal volumes

The proliferation of SLB (Sale & Leaseback), ABS and EETC transactions covering billions of dollars of investment each year indicates confidence in the market as a whole. However all are reliant on the quality and performance of the lessors, asset managers and airlines that are managing the aircraft. Which deal types are providing the better returns and where are the pressure points?

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Ishka Vista: 2018 Aviation Finance Market Forecast identifies and addresses the critical issues impacting the investment landscape over the next 12-18 months, enabling investors, lessors and financiers to effectively compete in tomorrow’s markets

Contact Chris Keene: [email protected] +44 (0)20 3176 6392

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