Soaring airliner demand predicted to power $4.3 trillion finance market

The predictions come in a new World Fleet Forecast, published by Avolon, the international aircraft leasing company.

The analysis includes forecasts of aircraft deliveries, retirements, funding requirements and passenger-to-freighter conversions.

Dick Forsberg, Avolon’s head of strategy and author of the report, said: “The growth fundamentals of the airline industry remain strong for the next two decades, and we expect that the cycles for aircraft orders and deliveries will continue to move in line with the broader economic cycle.

“To fund these new deliveries, we expect that a total of $4.3 trillion in additional financing will be required, with $700 billion needed over the next five years and an average of $170 billion annually over the next decade.

“In order to meet these significant needs, the roles of the various liquidity providers will continue to evolve, with operating lessors’ market share increasing from 40% to 50%, over time, supported by increased participation by capital markets and new investor classes.”

Avolon’s World Fleet Forecast covers all Western-built passenger and cargo jets in airline service, plus the main Russian and Chinese types.

Aircraft deliveries, retirements and passenger-to-freighter (“P2F”) conversions are projected over a 20-year period. The resulting annual forecast of the in-service fleet is modified by an estimate of the number of aircraft expected to be in storage.

Avolon is the world’s third largest aircraft leasing business, with an owned, managed and committed fleet of 915 aircraft.

It provides aircraft leasing and lease management services and is a wholly-owned, indirect subsidiary of Bohai Capital Holding Co, a Chinese public company listed on the Shenzhen Stock Exchange.

Jet airliner 20-year fleet forecast

Source: Avolon