Boeing’s recent assertion that the appetite of capital markets to fund airliner orders has increased comes as especially welcome news to manufacturers and their customers at a time when other sources of funding seem under pressure. Export credit, in particular, now comes generally at higher interest rates and with tougher equity requirements. At the same time, such government-backed capital has become a hostage to global politics, according to Kostya Zolotusky, managing director for capital markets development and leasing at Boeing Capital.
AIN Air Transport Perspective
A pair of major new suppliers for Embraer’s next-generation E-Jets identified themselves last week in a sign that program advancement continues apace despite the airframer’s reservations about communicating any details about its plans for an industrial launch or even performance specifications.
U.S. airlines have managed to stay profitable during a period of recession and spiking fuel prices, but small- and medium-sized airports have paid the price in reduced domestic air service, according to a Massachusetts Institute of Technology (MIT) study.
UK-based low-cost carrier EasyJet, Airbus and Nicarnica Aviation plan a final test in August of the Nicarnica-developed airborne-volcanic-object imaging detector in a bid to prevent major air traffic disruption like the one the eruption of Iceland’s Eyjafjallajökull caused in 2010.
A major restructuring at Air India has cut loss-making routes to 25 percent of its network in the fiscal year ending March 2013, down from 69 percent in the previous year. The airline attributes the improvement to a series of steps taken to cut costs, restructure loans, strengthen management and liquidate assets, including the spin-off of engineering and ground handling as independent profit centers.
Airlines are benefitting from growing capital market support for new aircraft financing, with this source of funding expected to account for as much as 15 percent of all transactions this year, according to Boeing Capital. A few years ago, capital markets accounted for barely 2 to 3 percent of aircraft financing.
Sita is supporting the launch of datalink ATC service in Indonesian airspace. The Geneva-based company has an agreement with Indonesia’s air navigation service provider to provide an air-to-ground datalink infrastructure that will enable pilots and controllers to communicate in the Jakarta flight information region.
Struggling Scandinavian flag carrier SAS has signed an agreement to sell its regional subsidiary Widerøe as part of an ongoing restructuring program to achieve financial stability. SAS will sell 80 percent of Widerøe to Norwegian companies Torghatten ASA, Fjord1 AS and Nordland Fylkeskommune. The sales will include seven Bombardier Q400 turboprops that SAS currently leases to the regional carrier. The transaction must be approved by Norwegian authorities, and is expected to close in September.
Last month US Airways became the first airline to receive FAA certification approval of the SafeRoute suite of NextGen avionics applications in the Airbus A330. The airline claims SafeRoute will “enhance operational safety and efficiency during various phases of flight.”
As the Regional Airline Association gathered its membership in Montreal from May 6 to 9 for its first-ever annual convention held outside the U.S., few among the RAA braintrust could set aside thoughts of events back home in Washington, D.C. In fact, what many consider the FAA’s bungled effort to advance the Next Generation Air Traffic Control system, or NextGen, took top billing among the various panel discussions held at the Palais des Congres de Montreal, where the RAA saw some 1,400 visitors pass through the turnstiles.