By Robert Wall
LONDON-- Boeing Co. projects demand for $124 billion in jetliner
financing next year as airlines need to fund more than 1,300
aircraft deliveries planned for 2015.
Airlines and lessors "will continue to have access to highly
efficient financing," said Tim Myers, vice president for aircraft
financial services at Boeing Capital Corp., the financing arm of
the world's biggest plane maker. Demand for financing is expected
to continue to grow through the decade and reach $156 billion in
2019.
Strong demand for more fuel-efficient jets has driven output at
Boeing and rival Airbus Group NV to record levels. The two have
combined to build more than 1,200 planes already this year.
"We are seeing a lot of diversity in the markets," Mr. Myers
said. Financing sources for plane deliveries is more global than
historically, he added. China remains the largest source for global
aircraft debt, ahead of Germany and Japan. U.S. lenders next year
are poised to represent 9% of the market, Boeing projects.
Capital markets will finance 32% of deliveries, overtaking bank
debt as the primary source of funding. That includes carriers
issuing asset backed bonds as well as a surge in private
placements, Mr. Myers said.
Even so, some areas of difficulty exist. Boeing is scheduled to
deliver around $2 billion worth of aircraft to Russia next year at
a time when sanctions over the country's actions in Ukraine have
limited capital access for local banks. Mr. Myers said Boeing is
working with Chinese and Middle East institutions to help secure
delivery financing.
An issue for the U.S. plane maker is that the U.S. Export-Impact
Bank has ceased new dealings with Russia, Mr. Myer said. European
export credit agencies are still open to backing Airbus Group NV
deliveries to Russia.
Another concern for the Chicago-based plane maker is continued
uncertainty over the fate of ExIm in the U.S.
Congress has battled over the future of the agency amid
accusations by detractors it represents a market-distorting subsidy
to industry.
The political uncertainty has caused some airlines to ask Boeing
to backstop borrowing in case ExIm doesn't get reauthorized by
Congress, Mr. Myers said. "We think it is going to get
reauthorized," he added. Eliminating ExIm would put Boeing at a
competitive disadvantage over rivals that can still get national
export credit backing, Mr. Myers said.
The agency is projected to be involved in delivery financing for
around 13% of Boeing jets next year. The backing was much higher
around 2009 when other funding sources had dried up amid the global
financial crisis. Export credit agencies around the world are
expected to back 15% of total plane deliveries next year, Boeing
projects.
The recent drop in oil prices so far has had little impact on
funding availability, Mr. Myers said, adding demand for replacement
jets hasn't slowed. Even if oil remained at current low levels and
pressure to field more fuel-efficient planes eases, it should not
have a significant impact on delivery plans, he said.
Write to Robert Wall at robert.wall@wsj.com
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