Airbus and Boeing plan loans for buyers
03 / 07 / 2012
AIRBUS and Boeing are to issue billions of dollars of loans to airlines to help shore up their order lists, according to the International Air Transport Association (IATA).
Giovanni Bisignani (right), the head of IATA, said the move is a result of what is predicted to be a “very, very tough” 2009.
However, a spokesperson for Airbus said that Mr Bisignani did not speak for the company.
“Backstop financing is standard industry practice and is agreed at the time of contract,” he said. “This happens years in advance of aircraft delivery and is not the same thing as providing billions of dollars of loans.”
Backstop financing is a temporary loan issued to airlines until they can secure their primary loan from a bank or investor.
Both aircraft manufacturers claim that their delivery streams and long waiting lists mean that they will not have any problems with creation of ‘white tails’ – aircraft built but with no owners and therefore no livery painted onto their tails
Bob Saling, international and sales communications at Boeing, told Air Cargo News that he wasn’t concerned. “White tails just don’t happen for Boeing.”
Chris Tarry, a leading aviation consultant, claims otherwise: “The manufacturers have been in denial. They have hoped that if they tell everyone it’s OK out there, then everyone will think it is and keep buying, but realisation is looming.
“Both Airbus and Boeing each have between 800 and 900 planes on their order books, many of which the carriers are not going to be able to take. Because of the lead and lag times for deliveries, there is far too much equipment about to be delivered as we enter the.”