Asia picks up plane funding slack

In 2011, Asian lenders participated in "almost 20 percent" of the funding involved in Airbus deliveries, Thomas Enders, chief executive of the European planemaker, said Wednesday.

Enders told a news conference at the Singapore Airshow that the figure showed an "increasing appetite" from Asian financial institutions to fund aircraft purchases.

"What is important is that all these institutions in Asia are not just working with the airlines from this region but on a global scale," Enders said.

The Airbus chief welcomed this as "good news for the airlines," and added that the world's biggest planemaker in numbers was actually "helping customers reorient their financing needs."

Scarce European funds

The shift in aircraft financing comes as European financial institutions - suffering from the eurozone debt crisis - are finding that they lack the means to fund large aircraft orders.

In 2011, Airbus received orders for 1,600 planes worth $85 billion (64.5 billion euros) from the Asia-Pacific region, the company said. Within the next 20 years the region would take delivery of 9,370 new aircraft valued at $1.3 trillion.

That would account for 34 percent of new planes with more than 100 seats, said Airbus CEO Tom Enders, propelling the region to "overtake North America and Europe as the world's biggest aviation market."

"Our business is not moving East, it has moved to the East," Enders said, adding that he was confident that "lower financing capacities in Europe, can be substituted by Asia."

Earlier this week, Airbus rival Boeing said that leasing companies and capital markets would take on a bigger role in funding aircraft purchases.

Author: Uwe Hessler (AP, AFP)
Editor: Michael Lawton