Understand what we can learn from lessor collection rates and RPK for the year so far. What is an optimistic and cautious timeline for the industry recovery as of June 2021?
Are more lessor consolidations on the horizon? What does the market look like for non-investment grade lessors? How does the size of the lessor affect their appeal to airlines? Could mega lessors hoover up all the business? Is there scope for fragmentation rather than consolidation with new players? Ultimately, will market shifts lead to more or less investors in the space? What is the impact of that?
What do delivery profiles look like over the next 3 to 4 years? How much money is needed and how much will it cost? Assessing the general availability of non-recourse bank debt and other financing options for leasing platforms Will there be a resurgence of OEM financing? How much will ECAs and private supported finance be involved? Do lessors expect to do any financing? What return do investors expect? Is there enough long term visibility to start lending further down the credit spectrum?
How are new SLB transactions pricing over the last 12 months? Has this changed much over the pandemic? Has there been an uplift in yield? What is the deal pipeline looking like? How comp etitive is the market and are all lessors competing? Have terms for new SLB deals changed at all?
What types of portfolios are being presented to investors? How deep is the list of potential buyers? Are sellers willing to discount book value and accept market price? Are we seeing the predicted surge of discounted assets hit the market?
Ishka asks a selection of the industry’s best remarketers about the current market.
Since launch has the platform been successful? Do airlines have enough incentive to participate? How are people getting comfortable with the platform? How much trading activity has there been to date and what has happened throughout the pandemic? Have there been unseen benefits/downfalls in the system? What is the strategy going forward?
Examining Ishka’s Q2 Pricing Benchmarking report What are key near-term trading prospects? Is there any update within the young narrowbody space? Which aircraft will remain in storage indefinitely? Are any asset type values recovering faster than expected?
An all star panel of aviation experts will be presented with a range of aircraft portfolios. They will then decide what to do with them. Will they Take It or Leave It?
Can engine shops handle a surge in demand as airlines start flying again? Will this affect pricing? Where does the engine leasing business sit at the start of an up-turn? Are we seeing tighter bids for engines from with investors and MRO shops? If so, for which types? Which engine assets are not seeing any form of recovery yet?
Where is the value for the part out market currently? Which aircraft types are being parted out? Are there any surprises? Is the age of teardown candidates noticeably younger than pre-pandemic? When should part out companies start stocking up for a rise in demand?
Tackling the widebody conundrum: When will airline demand for twin-aisle pick up? Will narrowbodies like the Airbus A321 XLR be a suitable replacement for many longer distance routes? Is it better to diversify your fleet for different passenger loads or does the LCC single aircraft type model prove most advantageous? How does the industry view the competition between A321 and 737 MAX-10?
How healthy are carriers now? Are more airlines restructurings likely? How can /should lessors prepare for the rest of 2021 and 2022? How aggressive have airlines been in cutting costs and reducing leases? Have restructurings been successful in creating more viable airlines?
1. Technical stipulations – A look at critical technical elements, including inter-relationships between qualifying events, MTBR adjustments and agility/flexibility around LLP stack replacement. 2. Contractual stipulations – Discussing structure to support nuances that exist within these contracts. 3. Commercial aspects – While the contract may place certain obligations on the Lessee, the model needs to cater for the commercial realities that often take place.
A forward look at the freighter market At what price point does it make sense to convert narrowbodies? What do returns look like? How long is the queue now for conversion slots? The outlook for cargo demand. Are too many lessors chasing freighter conversions?
What would a worldwide tax minimum hike mean for aviation hubs? Will that end the ‘race to the bottom’? What does the EU Anti-Tax Avoidance Directive mean for restrictions on tax deductibility of interest? An update on the latest ongoing consultations
Will banks demand a premium for financing older aircraft or seek to impose restrictions on warehouse facilities? Could environmental concerns alone erode residual values for older assets? Are mid-life assets likely to be “phased out” of investor portfolios? How will emissions calculators and new industry standards impact older aircraft values?
Given the cost advantages that Ultra Low Cost Carriers have over Full Service Carriers, what are investors expecting in terms of Cost of Available Seat-Kilometer reduction when exiting Chapter 11? What are airlines’ own expectations? From the initial cost cutting plan, what cost targets have been achieved and which have not? Why haven’t they been reached? What were the key takeaways from the negotiation process with lessors?